One-glance verdict
Overvalued
$-41.01 our estimate vs market $35.53
Wall Street consensus: $50.64 (-223.5% lower than our fair-value estimate)
187% below our estimate, beyond the bull case
Fundamentals snapshot
Hilton Grand Vacations Inc.
HGV · NYQ · Consumer Cyclical · Resorts & Casinos
Current price
$35.53
52-week range
$33.98 - $55.40
Market cap
$2.76B
Balance sheet
Distressed
2.10x Stretched
Net debt $7.56B. Interest coverage shows how many times profit covers the interest bill.
What stands out
2 Rewards
3 Risks
2 rewards · 3 risks
- Reward Revenue grew 4.5% last year.
- Reward Free cash flow was positive in 9/10 years.
- Risk Net debt grew 96.2% over 3 years.
- Risk Insider ownership is only 2.1% (peer median: 27.7%).
What this company does
Hilton Grand Vacations Inc.
Hilton Grand Vacations (HGV) sells vacation ownership interests, essentially giving people a share in a vacation property for a set time, and also manages those properties. Their main income comes from selling these vacation shares and from fees charged for managing the resorts and the clubs that offer travel services. This matters because it shows how they make money by both selling a product (vacation ownership) and providing ongoing services, impacting their profit margins (the percentage of sales revenue left after paying for business operations).
How the company got here
Hilton Grand Vacations (HGV) started in 1992 as part of Hilton Hotels, focusing on the timeshare vacation ownership model. Over the years, it grew its portfolio of properties and customer base. A significant turning point was its spin-off from Hilton Worldwide in 2017, becoming an independent, publicly traded company. This allowed HGV to focus solely on its vacation ownership business, expanding its reach and offerings in popular travel destinations across the U.S., Japan, and Europe.
What it actually does
HGV sells vacation ownership interests (VOIs), which are essentially a way for people to buy a share of a vacation property for a specific period each year. Think of it like owning a piece of a vacation home that you can use, but without the hassle of managing it yourself. They also manage these properties and offer club memberships that provide flexibility in choosing vacation destinations and dates. Essentially, HGV sells and manages dream vacations for its owners.
Real Estate Sales and Financing
This is where HGV makes money by selling those vacation ownership interests (VOIs) we talked about. They market and sell these VOIs directly to customers, often at or near their resort properties. They also provide financing to buyers who want to pay for their timeshare over time, acting like a lender. This segment is a major driver of HGV's revenue, as it's the initial sale of the core product.
Resort Operations and Club Management
Once people own a timeshare, HGV manages the resorts where those timeshares are located. This segment also runs the club programs, which allow owners to exchange their week for a different one or at a different location, offering flexibility. They also generate revenue from renting out unsold inventory or units that owners have exchanged. Think of this as the ongoing service and operational side of the business, keeping the properties running smoothly and providing value to club members.
What management is betting on now
HGV is focused on growing its existing resort portfolio and expanding into new, desirable locations. They are also investing in technology and digital tools to enhance the customer experience, from the initial sales process to managing their vacations. A key strategy is to leverage the strength of the Hilton Grand Vacations brand to attract new owners and provide them with memorable vacation experiences. This focus aims to drive both sales of new vacation ownership interests and repeat business from existing members.
Price history
How the share price has moved
—
Loading price history…
Earnings history
Last 8 quarters — what happened
Click any quarter to read the call summary and what the numbers say.
FY2024 Q3
$81.00M
FY2024 Q4
$90.00M
FY2025 Q1
$24.00M
FY2025 Q2
$46.00M
FY2025 Q3
$13.00M
FY2025 Q4
$147.00M
FY2026 Q1
$122.00M
FY2026 Q2
$131.00M
Revenue
$1.36B
Net income
$12.00M
Diluted EPS
0.15
Operating cash flow
$134.00M
Free cash flow
$131.00M
Fetching…
Sources
Revenue
$1.28B
Net income
$66.00M
Diluted EPS
0.79
Operating cash flow
$128.00M
Free cash flow
$122.00M
Fetching…
Sources
Revenue
$1.33B
Net income
$48.00M
Diluted EPS
0.53
Operating cash flow
$167.00M
Free cash flow
$147.00M
Fetching…
Sources
Revenue
$1.30B
Net income
$25.00M
Diluted EPS
0.28
Operating cash flow
$34.00M
Free cash flow
$13.00M
Fetching…
Sources
Revenue
$1.27B
Net income
$25.00M
Diluted EPS
0.25
Operating cash flow
$61.00M
Free cash flow
$46.00M
Fetching…
Sources
Revenue
$1.15B
Net income
$-17.00M
Diluted EPS
-0.17
Operating cash flow
$38.00M
Free cash flow
$24.00M
Fetching…
Sources
Revenue
$1.28B
Net income
$20.00M
Diluted EPS
0.19
Operating cash flow
$105.00M
Free cash flow
$90.00M
Fetching…
Sources
Revenue
$1.31B
Net income
$29.00M
Diluted EPS
0.28
Operating cash flow
$91.00M
Free cash flow
$81.00M
Fetching…
Sources
Is it cheap or expensive?
Fair value $-41.01 vs current price $35.53
Wall Street consensus is the average analyst price target: $50.64 (-223.5% lower than our fair-value estimate).
Our most-likely fair value is $-41.01 a share — about 215.4% below today's price of $35.53, so the stock currently looks expensive (overvalued).
Is it drowning in debt?
Distressed
Net debt $7.6B. Interest coverage 2.1x.
Net debt
$7.56B
Interest coverage
2.10x
Hilton Grand Vacations Inc.'s profit covers its interest bill about 2.1 times over.
Distressed
Worse cushion
Baseline
Better cushion
HGV
BASELINE
Hilton Grand Vacations Inc.
Total debt $7.85B Interest coverage 2.10x This is the baseline the peer rows are being compared against.
Total debt $12.34B Interest coverage 1.93x -8% vs HGV Has roughly the same debt cushion as HGV.
Total debt $30.16B Interest coverage 3.19x +52% vs HGV Carries about 1.5x more debt cushion than HGV.
Total debt $15.46B Interest coverage 4.14x +97% vs HGV Carries about 2.0x more debt cushion than HGV.
Total debt $17.77B Interest coverage 5.12x +144% vs HGV Carries about 2.4x more debt cushion than HGV.
What you should know
The case for and against HGV
2 Rewards
3 Risks
Rewards
-
Revenue grew 4.5% last year.
-
Free cash flow was positive in 9/10 years.
Risks
-
Net debt grew 96.2% over 3 years.
-
Insider ownership is only 2.1% (peer median: 27.7%).
-
Operating margin compressed from 18.1% to 12.7% over 3 years.
The numbers
All the key metrics, grouped by purpose
Tap any ? icon to learn what it means.
Valuation
How expensive the stock looks
P/E (TTM)
20.19x
Forward P/E
6.92x
P/B
2.52x
P/S
0.59x
EV/EBITDA
11.27x
PEG ratio
—
Profitability
How much profit each dollar creates
Gross margin
24.6%
Operating margin
12.7%
Net margin
3.2%
ROE
11.5%
ROA
3.3%
Health
Liquidity and balance-sheet strength
Debt / equity
6.24x
Current ratio
4.81x
Quick ratio
2.88x
Total debt
$7.85B
Total cash
$290.00M
Growth
How the business has been compounding
Revenue TTM
$5.28B
Revenue 5Y CAGR
21.3%
EPS TTM
1.76
EPS 5Y CAGR
-32.8%
Cash flow
How much cash the business throws off
Operating CF TTM
$463.00M
Free CF TTM
$230.00M
FCF margin
4.4%
Dividend
Shareholder payout
Yield
0.0%
Payout ratio
0.0%
Last ex-div date
—