Start here if you're new
what it is
Wyndham licenses hotel brands to 9,280 franchisees, so other people own the buildings while Wyndham collects royalties and fees.
how it gets paid
Last year Wyndham Hotels made $1.4B in revenue. Royalties was the main engine at $0.58B, or 41% of sales.
why it's growing
Revenue grew 1.8% last year. A 34.5% earnings miss matters more than the revenue print because this stock is being sold on margin discipline and EPS growth.
what just happened
The last report missed estimates by 34.5%, which is the number you cannot ignore.
At a glance
B+ balance sheet — decent shape, but not bulletproof
55/100 earnings predictability — expect surprises
17.3x trailing p/e — the market's not buying it — or you found a deal
2.3% dividend yield — cash in your pocket every quarter
10.5% return on capital — nothing to write home about
xvary composite: 58/100 — below average
What they do
Wyndham licenses hotel brands to 9,280 franchisees, so other people own the buildings while Wyndham collects royalties and fees.
Wyndham wins because it sells hotel brands, not hotel buildings. It has about 9,200 hotels and roughly 872,000 rooms across 95 countries, which gives owners a giant reservation and brand network before they even hang the sign. Asset-light (earns fees without paying for the real estate) → other people fund the buildings → so you still got a 28.1% operating margin and 24% return on equity.
How they make money
$1.4B
annual revenue · their business grew +1.8% last year
Royalties
$0.58B
Franchise and license fees
$0.29B
Marketing, reservation, and loyalty fees
$0.25B
Management fees
$0.14B
Other hotel services
$0.14B
The products that matter
licenses brands to hotel owners
Hotel franchising
$1.4B · +1.8% growth
This is effectively the whole business. Roughly 9,200 hotels and 872,000 rooms feed a fee stream that is high-margin by design and only modest-growth by recent results.
asset-light core
Key numbers
17.3x
trailing p/e
You are paying 17.3 times trailing earnings for a stock with a $103 18-month target, which is 31% above $78.58.
28.1%
operating margin
Operating margin → profit left after running the business → so Wyndham keeps about $0.28 of every revenue dollar before interest and taxes.
$2.6B
long-term debt
Debt equals 30% of capital, which is fine until travel weakens or rates stay high longer than management wants.
19.5%
eps growth
Projected earnings growth is 19.5% while projected sales growth is -3.0%, so this story is about efficiency, not booming demand.
Financial health
B+
strength
- balance sheet grade B+ — solid but not elite
- risk rank 3 — safer than 50% of stocks
- price stability 70 / 100
- long-term debt $2.6B (30% of capital)
- net profit margin 28.3% — keeps 28 cents of every dollar in revenue
- return on equity 24% — $0.24 profit for every $1 investors have put in
B+ — functional but not a standout on the balance sheet.
Total return vs. market
You invested $10,000 in WH 3 years ago → it's now worth $11,470.
The index would have given you $14,770.
source: institutional data · total return
What just happened
missed estimates
The last report missed estimates by 34.5%, which is the number you cannot ignore.
Consensus shows last earnings at $0.93 versus a $1.42 estimate. That miss landed even as quarterly data in the source set shows revenue of $1.1B, which tells you the issue was not simple top-line collapse.
$1.1B
revenue
$0.93
eps
28.1%
gross margin
the number that mattered
A 34.5% earnings miss matters more than the revenue print because this stock is being sold on margin discipline and EPS growth.
-
if this turns out to be the case (the company is slated to report results shortly after we went to press with this issue), it would mark the second consecutive year of this trend.economic headwinds, namely tariff-related challenges and uneven consumer spending patterns, have brought about some concerns in the travel market. looking closer, the company’s results through the first nine months of the year were driven by solid global system growth, particularly in the midscale and above u.s. market, along with emea (europe, the middle east, and africa). these positive factors helped to offset sluggish revpar (revenue per available room) growth on the domestic front.
-
we believe that the positive momentum will continue as we shift our attention to 2026.
-
although there are some concerns on the economic front, we look for gdp growth of 2% or so next year, which is on par with its historical average.this would be good news for hotel operators such as wyndham, as it should help boost revpar. the company’s international presence is also a plus, as it provides diversification if the domestic market slumps. earnings per share are poised to advance at a low-double-digit annual clip, on average, over the 3to 5-years ahead. our forecast is based on healthy economic conditions over that time frame, which is essential due to the cyclical nature of the hotel industry. also, the company is highly leveraged, though this is commonplace, due to the capital intensive nature of the industry.
-
these shares are best suited for investors with intermediate to longer-term horizons.indeed, they are only ranked to match the broader market averages in the year ahead based on our timeliness ranking system.
-
however, they are a more alluring option over the 18-month and 3 to 5-year intervals.
source: company earnings report, 2026
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What could go wrong
The main risk here is not that Wyndham suddenly forgets how franchising works. It is that a $1.4B fee business growing just 1.8% stops getting treated like a compounder and starts getting priced like a mature stream with $2.6B in debt attached.
med
slow growth becomes the whole story
Revenue rose 1.8% from last year. That is acceptable for stability. It is thin for a company investors want to see compound through scale.
Revenue rose 1.8% from last year. That is acceptable for stability. It is thin for a company investors want to see compound through scale.
med
debt and refinancing stay in the foreground
There is $2.6B in long-term debt, or 30% of capital, and Fitch rated proposed notes BB+. That is manageable today. It also means credit conditions can pressure sentiment fast.
There is $2.6B in long-term debt, or 30% of capital, and Fitch rated proposed notes BB+. That is manageable today. It also means credit conditions can pressure sentiment fast.
med
an asset-light model still depends on property owners
Wyndham does not need to own the buildings to feel it when hotel owners struggle, delay renovations, or slow expansion. Roughly 9,200 hotels and 872,000 rooms give you scale. They also give you a lot of moving parts.
Wyndham does not need to own the buildings to feel it when hotel owners struggle, delay renovations, or slow expansion. Roughly 9,200 hotels and 872,000 rooms give you scale. They also give you a lot of moving parts.
The setup is still investable, but your downside case is easy to see: 14.7% to the $67 low target is already on the table.
source: institutional data · regulatory filings · risk analysis
Pay attention to
metric
revenue growth is still only 1.8%
That is the quiet part. A 28.3% net margin buys patience. A 1.8% growth rate limits how much patience the market will give you.
risk
BB+ notes rating puts debt back in view
Fitch’s recent action says lenders still see meaningful credit risk. With $2.6B in long-term debt, you should treat debt as part of the thesis, not a footnote.
calendar
the 2026-02-19 10-K is the latest baseline
Use it as your reset point. If the next update still shows giant scale and modest growth, the debate stays exactly where it is now.
trend
institutional selling has lasted 2 straight quarters
There were 184 buyers versus 214 sellers in 3q2025. Same stock. Same public data. Large investors have not been unanimous here.
Analyst rankings
earnings predictability
55 / 100
in human-speak, analysts see this as moderately reliable, not highly predictable. You should expect steadier numbers than a hotel owner, but not perfectly smooth ones.
price stability
70 / 100
The stock has been more stable than many cyclical names. It still traded inside a wide $68–$113 range over the last year, so stable does not mean sleepy.
source: institutional data
Institutional activity
institutions have been net selling for 2 consecutive quarters — 184 buyers vs. 214 sellers in 3q2025. total institutional holdings: 79.2M shares. net selling for 2 quarters.
source: institutional data
Price targets
3-5 year target range
$67
$139
$79
current price
$103
target midpoint · +31% from current · 3-5yr high: $165 (+110% · 22% ann'l return)
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