• Wondering if Park Hotels & Resorts is a bargain at its current US$10.87 share price, or if the easy value has already been taken? This article breaks down what the numbers are really saying about the stock.
• The share price has moved 4.7% over the last 7 days, 1.5% over the past month, 0.9% year to date, with a 1 year return of 18.5% and a 3 year return of 29.9%, while the 5 year return sits at a 25.9% decline.
• Recent coverage around Park Hotels & Resorts has focused on how investors are reassessing hotel and resort REITs, with attention on balance sheet resilience, property portfolios and broader travel trends. This context helps explain why the stock's recent returns differ across short, medium and longer time frames.
• On Simply Wall St's 6 point valuation checklist, Park Hotels & Resorts currently scores 5 out of 6. The sections that follow look at what traditional valuation tools say about that score, before finishing with a broader way to think about what the market might be pricing in.

Find out why Park Hotels & Resorts's 18.5% return over the last year is lagging behind its peers.

Approach 1: Park Hotels & Resorts Discounted Cash Flow (DCF) Analysis

A Discounted Cash Flow model takes Park Hotels & Resorts’ adjusted funds from operations, projects them into the future, then discounts those cash flows back to today to estimate what the business could be worth right now.

For Park Hotels & Resorts, the latest twelve month free cash flow is about $394 million. Analysts provide forecasts for several years, and Simply Wall St then extrapolates further, using a 2 stage Free Cash Flow to Equity model based on adjusted funds from operations. Under this framework, projected free cash flow for 2035 is $413.3 million, still in the same general range as today in dollar terms.

When all those projected cash flows are discounted back to the present, the estimated intrinsic value comes out at about $22.63 per share. Compared with the recent share price of US$10.87, the model implies the stock is around 52.0% undervalued.

Result: UNDERVALUED

Our Discounted Cash Flow (DCF) analysis suggests Park Hotels & Resorts is undervalued by 52.0%. Track this in your watchlist or portfolio, or discover 64 more high quality undervalued stocks.

Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for Park Hotels & Resorts.

Approach 2: Park Hotels & Resorts Price vs Sales

For companies where earnings can be volatile or influenced by accounting adjustments, the P/S multiple is often a useful yardstick because it compares what you pay for each dollar of revenue. It still reflects what the market thinks about growth prospects and risk, since faster growth or lower risk usually supports a higher “normal” or “fair” P/S ratio compared with slower growth or higher risk.

Park Hotels & Resorts currently trades on a P/S of 0.86x. This sits below the Hotel and Resort REITs industry average P/S of 4.09x and below the peer group average of 1.66x. Simply Wall St’s Fair Ratio for Park Hotels & Resorts is 1.84x, which is an estimate of what the P/S could be given factors such as its earnings profile, industry, profit margins, market cap and specific risks.

The Fair Ratio is more tailored than a simple comparison with peers or the broad industry because it adjusts for company specific characteristics, instead of assuming all hotel and resort REITs deserve the same multiple. With the current P/S at 0.86x versus a Fair Ratio of 1.84x, the shares screen as undervalued on this measure.

Result: UNDERVALUED

P/S ratios tell one story, but what if the real opportunity lies elsewhere? Start investing in legacies, not executives. Discover our 19 top founder-led companies.

Upgrade Your Decision Making: Choose your Park Hotels & Resorts Narrative

Earlier it was mentioned that there is an even better way to understand valuation, so Narratives are introduced. They let you attach a clear story about Park Hotels & Resorts to the numbers by linking your view on its future revenue, earnings and margins to a financial forecast, and then to a Fair Value that can be compared with the current share price.

On Simply Wall St’s Community page, Narratives are an easy tool that millions of investors use to set out their assumptions and instantly see what those imply for Fair Value. Because the platform updates Narratives when fresh information such as news or earnings arrives, your view stays aligned with the latest data instead of being locked into a one off model.

For Park Hotels & Resorts, one investor might build a more optimistic Narrative around a Fair Value near US$17.62 that leans on higher revenue growth, improving margins and a future P/E of about 33x. Another might build a more cautious Narrative closer to US$10.00 with slower revenue growth, more modest margin gains and a future P/E nearer 20x. Seeing both side by side helps you judge where your own expectations sit and whether the current US$10.87 price fits your story.

For Park Hotels & Resorts, we will make it really easy for you with previews of two leading Park Hotels & Resorts Narratives:

🐂 Park Hotels & Resorts Bull Case

Fair Value in this bullish narrative: US$17.62 per share

Implied discount to this Fair Value at the recent US$10.87 price: about 38% undervalued

Assumed revenue growth: 2.34% a year

• Focus on asset sales, capital recycling and a tighter portfolio as potential drivers of stronger earnings, revenue and asset value.
• Assumes earnings reach US$147.0m by about April 2029 with profit margins rising to 5.4%, supported by projects such as Bonnet Creek, Casa Marina and Royal Palm South Beach.
• Relies on a higher future P/E of around 33x and a Fair Value of US$17.62, with analysts highlighting both opportunities from travel demand and risks from costs, competition and asset intensity.

🐻 Park Hotels & Resorts Bear Case

Fair Value in this bearish narrative: US$10.00 per share

Implied premium to this Fair Value at the recent US$10.87 price: about 9% overvalued

Assumed revenue growth: 1.20% a year

• Emphasises softer demand for traditional business and group travel, competition from alternative accommodation and changing consumer preferences.
• Highlights ongoing cost pressure from older, unionised urban hotels, capital spending needs and climate related expenses that could weigh on margins and free cash flow.
• Anchors on a Fair Value of US$10.00 using lower assumed revenue growth, a 19.8x future P/E and a higher discount rate of 12.0%, with analysts seeing current expectations as too optimistic.

To see how these views, assumptions and risks are built out in full, you can review the complete Narratives and decide which version of Park Hotels & Resorts comes closest to your own expectations for the business. See what the community is saying about Park Hotels & Resorts

Do you think there's more to the story for Park Hotels & Resorts? Head over to our Community to see what others are saying!

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com

Disclaimer:This article represents the opinion of the author only. It does not represent the opinion of Webull, nor should it be viewed as an indication that Webull either agrees with or confirms the truthfulness or accuracy of the information. It should not be considered as investment advice from Webull or anyone else, nor should it be used as the basis of any investment decision.