Price to FCFE (P/FCFE)
Free Cash Flow to Equity (FCFE)
Hilton Worldwide Holdings Inc., FCFE calculation
US$ in millions
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
The cash flow profile from 2019 to 2023 is characterized by a period of severe contraction followed by a robust recovery in both operational cash generation and the cash available to equity holders.
- Operating Cash Flow Performance
- Net cash provided by operating activities experienced a significant decline from US$ 1,384 million in 2019 to a low of US$ 109 million in 2021. This downward trajectory was reversed starting in 2022, with cash flow increasing to US$ 1,681 million and further rising to US$ 1,946 million by 2023, indicating a full recovery and expansion of operational liquidity.
- Free Cash Flow to Equity (FCFE) Volatility
- FCFE demonstrated substantial volatility over the five-year period. A notable peak occurred in 2020 at US$ 3,014 million, which stood in contrast to the declining operating cash flow of that year, suggesting that financing activities or asset divestitures significantly augmented cash available to equity. This was followed by a sharp reversal in 2021, where FCFE fell to a deficit of US$ 1,766 million, reflecting a period of substantial capital expenditure or debt repayment.
- Comparative Recovery and Trend Analysis
- The trajectory from 2021 to 2023 shows a consistent and strong upward trend. By 2023, FCFE reached US$ 2,105 million, surpassing 2019 levels. The simultaneous growth of both operating cash flows and FCFE in the final two years of the period indicates a restored capacity for capital distribution and improved financial flexibility.
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Price to FCFE Ratio, Current
Hilton Worldwide Holdings Inc., current P/FCFE calculation, comparison to benchmarks
| No. shares of common stock outstanding | 246,427,097 |
| Selected Financial Data (US$) | |
| Free cash flow to equity (FCFE) (in millions) | 2,105) |
| FCFE per share | 8.54 |
| Current share price (P) | 203.52 |
| Valuation Ratio | |
| P/FCFE | 23.83 |
| Benchmarks | |
| P/FCFE, Competitors1 | |
| Airbnb Inc. | 22.08 |
| Booking Holdings Inc. | 16.09 |
| Chipotle Mexican Grill Inc. | 30.93 |
| DoorDash, Inc. | 20.29 |
| McDonald’s Corp. | 27.66 |
| Starbucks Corp. | 41.23 |
| P/FCFE, Sector | |
| Consumer Services | 22.98 |
| P/FCFE, Industry | |
| Consumer Discretionary | 45.20 |
Based on: 10-K (reporting date: 2023-12-31).
1 Click competitor name to see calculations.
If the company P/FCFE is lower then the P/FCFE of benchmark then company is relatively undervalued.
Otherwise, if the company P/FCFE is higher then the P/FCFE of benchmark then company is relatively overvalued.
Price to FCFE Ratio, Historical
Hilton Worldwide Holdings Inc., historical P/FCFE calculation, comparison to benchmarks
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | 252,160,518 | 266,450,664 | 279,139,082 | 277,607,799 | 277,447,716 | |
| Selected Financial Data (US$) | ||||||
| Free cash flow to equity (FCFE) (in millions)2 | 2,105) | 1,554) | (1,766) | 3,014) | 1,803) | |
| FCFE per share3 | 8.35 | 5.83 | -6.33 | 10.86 | 6.50 | |
| Share price1, 4 | 196.03 | 150.80 | 156.34 | 111.43 | 112.94 | |
| Valuation Ratio | ||||||
| P/FCFE5 | 23.48 | 25.86 | — | 10.26 | 17.38 | |
| Benchmarks | ||||||
| P/FCFE, Competitors6 | ||||||
| Airbnb Inc. | 25.72 | 24.76 | 54.32 | — | — | |
| Booking Holdings Inc. | 15.89 | 11.52 | 69.02 | — | — | |
| Chipotle Mexican Grill Inc. | 58.77 | 52.59 | 51.88 | — | — | |
| DoorDash, Inc. | 34.58 | 1,011.74 | 292.52 | — | — | |
| McDonald’s Corp. | 20.85 | 28.85 | 30.21 | — | — | |
| Starbucks Corp. | 29.75 | 34.82 | 45.80 | 20.79 | — | |
| P/FCFE, Sector | ||||||
| Consumer Services | 23.53 | 24.72 | 45.10 | — | — | |
| P/FCFE, Industry | ||||||
| Consumer Discretionary | 30.88 | 36.45 | 83.41 | — | — | |
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
1 Data adjusted for splits and stock dividends.
3 2023 Calculation
FCFE per share = FCFE ÷ No. shares of common stock outstanding
= 2,105,000,000 ÷ 252,160,518 = 8.35
4 Closing price as at the filing date of Hilton Worldwide Holdings Inc. Annual Report.
5 2023 Calculation
P/FCFE = Share price ÷ FCFE per share
= 196.03 ÷ 8.35 = 23.48
6 Click competitor name to see calculations.
The analysis of the relationship between share price and free cash flow to equity (FCFE) reveals a period of significant volatility followed by a valuation expansion. While the share price demonstrated a long-term upward trajectory, the FCFE per share exhibited instability, which directly impacted the resulting P/FCFE multiples.
- Share Price Movement
- The share price remained relatively stable between 2019 and 2020, followed by a robust increase starting in 2021. A consistent growth pattern emerged, with the price rising from 112.94 US$ in 2019 to 196.03 US$ by the end of 2023, representing a substantial appreciation in market valuation over the five-year period.
- FCFE per Share Volatility
- Free cash flow to equity per share demonstrated high variance. After an increase to 10.86 US$ in 2020, FCFE collapsed to a negative value of -6.33 US$ in 2021. A recovery phase followed, with FCFE returning to positive territory in 2022 at 5.83 US$ and strengthening further to 8.35 US$ in 2023.
- P/FCFE Ratio Interpretation
- The P/FCFE ratio fluctuated in response to the divergence between share price and cash flow generation. The ratio compressed to 10.26 in 2020 and became unavailable in 2021 due to the negative FCFE. In the subsequent recovery period of 2022 and 2023, the ratio surged to 25.86 and 23.48, respectively. This indicates that the market has attributed a significantly higher premium to each dollar of FCFE in recent years compared to the 2019-2020 period.
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