ONESPAWORLD HOLDINGS Ltd (OSW): what the price assumes
In the published model solve dated 2026-Q2, anchored at $26.60, ONESPAWORLD HOLDINGS Ltd (OSW) is priced for today's economics sustained for ~8.9 years. boothcheck publishes no house fair value, target price, or buy/sell rating; individual model outputs and user-controlled scenarios are analytical inputs, not Boothcheck targets. Narrative composed 2026-06-27.
Generated: 2026-08-10 · Exported: 2026-08-12 · Source: https://boothcheck.com/report/OSW
Headline
| Field | Value |
|---|---|
| Ticker | OSW |
| Company | ONESPAWORLD HOLDINGS Ltd |
| Current price | $26.60/sh |
| Composition | Service revenues - Maritime 78% / Service revenues - Destination resorts 3% / Product revenues - Maritime 19% / Product revenues - Destination resorts 0% / Product revenues - Timetospa.com 0% |
What The Price Assumes (Inversion)
The assumption today's price embeds, recovered by inverting the valuation.
| Field | Value |
|---|---|
| Inversion basis | whole-company |
| Operating margin (value-band context) | 4.8% |
| Operating margin today | 8.9% |
| Margin compression (value-band) | -4.1pp |
| Must persist for | 8.9y |
| Multiple paid | 31x operating income |
The operating-margin figure is value-band context at year 5: derived from the framework's value band, a separate calculation — not part of the priced-in solve.
Solve inputs: computed at a 10.7% cost of capital; growth searched up to the 25% self-funding ceiling; each 1pp moves the implied horizon ~1.9 years.
Reconcile: at the x-ray's 9.3% required return this reads ~6.2 years; the models below use their own rates.
How unusual the bet is: elevated
| Reference | Value |
|---|---|
| vs own history | +0.28σ |
| cohort percentile (of 34 peers) | 71 |
| sustained it ~8.9 years at this level | 17% |
| implied end-window share | 0% |
Valuation X-Ray
Asset, earnings-power and peer-multiple models all land far below the price; ONLY the growth-DCF reaches it. The bet is durable compounding the static frames structurally cannot price (a moat/durability premium).
How the valuation models price the stock relative to the market price. Price/FV above 1.0 means the market pays more than that lens defends (expensive); at or below 1.0 the lens can defend the price.
| Family | Median price/FV | Models | Reads |
|---|---|---|---|
| Asset | 2.65x | 5 | expensive |
| Earnings | 3.43x | 5 | expensive |
| Relative | 1.72x | 5 | expensive |
| Growth | 1.14x | 3 | expensive |
Families that justify the price: Growth Families that call it expensive: Asset, Earnings, Relative
The models below discount at their own flat-beta convention rates (cost of equity 9.3%, WACC 9.0%); the inversion above states its own rate.
Per-Model Detail (n=18)
| Model | Family | FV | Price/FV | Applicable | Methodology |
|---|---|---|---|---|---|
| DCF Perpetual Growth | Growth | $18.59 | 1.43x | yes | FCF base $0.1B, growth 10% (input: historical growth), terminal g 4.0%, WACC 9.0%, 6yr projection |
| DCF Exit Multiple | Growth | $27.61 | 0.96x | yes | Exit EV/EBITDA: 26.7x / 28.7x / 30.7x (bear / base = today's held flat / bull), 6yr |
| Relative Valuation | Relative | $15.45 | 1.72x | yes | P/E 19.9x (blended: static sector reference 14x + trailing (TTM) 34x), scenarios: 16.6x / 19.9x / 23.2x (bear / base = reference held flat / bull), EV/EBITDA 14.91x |
| Simple DDM | Growth | — | — | no | — |
| Two-Stage DDM | Growth | — | — | no | — |
| Simple Excess Return | Asset | $8.54 | 3.11x | yes | BV/sh $5.68, ROE (TTM) 13.9%, ke 9.3% |
| Two-Stage Excess Return | Asset | $10.36 | 2.57x | yes | 5yr excess ROE then converge to ke=9.3% |
| Discounted Future Market Cap | Growth | $23.34 | 1.14x | yes | Rev $1.0B, growth 10% (input: historical growth; tapered), Terminal P/S: 2.3x / 2.7x / 3.1x (bear / base = today's held flat / bull, cap 8x) |
| Peter Lynch Fair Value | Relative | $13.50 | 1.97x | yes | EPS $0.79, growth 17% (input: historical EPS growth), PEG=1.97 (Overvalued) |
| Margin Trajectory | Growth | — | — | no | — |
| Earnings Power Value | Earnings | $5.11 | 5.21x | yes | Normalized EBIT (5y avg op income, one-time charges added back) $0.05B × (1−1%) / WACC 9.0% → EPV (no growth) |
| Residual Income | Asset | $10.71 | 2.48x | yes | BV $5.68 + 5yr PV of (ROE (TTM) 13.9% − Kₑ 9.3%) × BV; BV grows 8.8%/yr |
| Graham Number | Asset | $10.05 | 2.65x | yes | √(22.5 × EPS $0.79 × BVPS $5.68) — Graham's conservative floor |
| EV/EBITDA Relative | Relative | $8.01 | 3.32x | yes | EBITDA $0.10B × sector EV/EBITDA 9.0x |
| FCF Yield | Earnings | $7.76 | 3.43x | yes | FCF $78.2M / Kₑ 9.3% — zero-growth perpetuity |
| SBC-Adj FCF Yield | Earnings | $6.76 | 3.93x | yes | SBC-adj FCF $0.07B (FCF $0.08B − SBC $0.01B) capitalized at Kₑ |
| Ben Graham Formula | Earnings | $25.49 | 1.04x | yes | EPS $0.79 × (8.5 + 2×15.0%) × (4.4 / 5.3%) |
| ROIC-Justified P/B | Asset | $2.42 | 10.99x | yes | BV $5.68 × (ROIC 3.8% / WACC 9.0%) |
| P/Sales Sector | Relative | $19.70 | 1.35x | yes | Revenue $1.01B × sector P/S 2.0x |
| PEG Fair Value | Relative | $20.25 | 1.31x | yes | EPS $0.79 × (PEG 1.5 × growth 17.1% (input: historical EPS growth)) → PE 25.6x |
| Earnings Yield | Earnings | $8.54 | 3.11x | yes | EPS $0.79 / required return 9.3% (Rf 4.3% + ERP 5.0%) |
| Funds From Operations Multiple | Relative | — | — | no | — |
| Clinical Phase NPV | Growth | — | — | no | — |
| Merton | Asset | — | — | no | — |
| V5 Mechanical | — | — | — | no | — |
Solvency
| Field | Value |
|---|---|
| Net debt | $43.6m |
| Net debt / NOPAT (after-tax) | 0.49x |
| Net debt / operating income (pre-tax) | 0.48x |
| Interest coverage | 16.8x |
| Share count CAGR (dilution) | 2.0% |
| Burning cash | no |
Bullet Takeaways
- At $27.53 the price pays about 33x company-wide operating income, a level that needs the growth to hold near its self-funding ceiling for roughly nine years. Only the forward-growth method reaches the price; every static frame says richly valued.
- The thing that defends the premium is the moat. OneSpaWorld is the near-monopoly operator of cruise-ship health and wellness centers, on 208 ships at the end of Q1 2026, a position the asset-based models structurally cannot price.
- The business is executing. Q1 2026 revenue rose 13% to $247.6 million, operating income rose 36%, and management raised full-year guidance to $1.014 to $1.034 billion in revenue. The risk it flagged is European demand softness in the back half.
Bull Case
Take the bear case head-on first, because it is the obvious objection: at $27.53 (June 27, 2026) OneSpaWorld trades at about 33x company-wide operating income, and only the forward-growth method reaches that price. Every static frame, asset value, earnings power, and peer multiples, says the stock is richly valued. Earnings Power Value lands at $3.93, the book-value methods near $8 to $10, and EV/EBITDA Relative at $7.56, all a fraction of the price. So the question is whether that premium is a bubble or a real durability premium that the standard frames cannot capture. The data points to the latter. OneSpaWorld is the dominant operator of outsourced health and wellness centers on cruise ships, a niche where it has effectively no scaled competitor, and a near-monopoly cash-light franchise is exactly the kind of business static valuation methods chronically underprice.
The execution underneath the premium is genuine, not hoped-for. Q1 2026 revenue grew 13% to $247.6 million, operating income rose 36% to $22.9 million, and net income rose 40%, driven by a 4% rise in revenue days, a 2% increase in average guest spend, and $23.1 million from fleet expansion (OneSpaWorld Q1 2026, stocktitan). Health and wellness centers operated on 208 ships at quarter end, up from 199 a year earlier, with average weekly revenue per ship of $91,872. The company's own filing flags revenue days and onboard staff productivity as the critical operating metrics it manages (FY2025 10-K, accession 0001193125-26-062456), and both are moving the right way. Management raised full-year 2026 guidance to $1.014 billion to $1.034 billion in revenue and $129 million to $139 million in adjusted EBITDA.
The growth runway is contractual and visible, which is what justifies the long-duration bet embedded in the price. New ship-builds come with OneSpaWorld already designed in: it added centers on Norwegian's Luna and the Disney Adventure, with six total new ship-builds on track for the year, and Medi-Spa services are now on 155 ships, a higher-margin upsell layered onto the base. As the global cruise fleet grows and existing contracts renew, OneSpaWorld captures a structurally expanding addressable base without owning the ships or the capital. The model converts to cash efficiently, interest coverage is about 15x, and the company is returning capital through a dividend and buybacks. The price asks for durable compounding, and a contractually embedded monopoly on a growing fleet is the rare business that can deliver it.
Bear Case
The structural fact to confront is the one the multiples shout: at 33x operating income the price is paying for what has not happened yet. The inversion is explicit that the bet is duration, the market needs OneSpaWorld to hold growth near its self-funding ceiling for roughly nine years, and historically only about 15% of comparable fast-growers sustained that pace over a window that long. The entire premium rests on a single, fragile assumption: that nothing interrupts the compounding for the better part of a decade. The asset and earnings-power frames are blunt about the downside if it does break. Earnings Power Value at $3.93, the Graham Number at $9.63, and the book-value methods near $8 to $10 describe where the stock could fall if the market ever reprices it as a normal services business rather than a monopoly.
The deeper vulnerability is that OneSpaWorld's fate is wholly tethered to an industry it does not control: cruising. Its revenue days, guest spend, and ship count all depend on the cruise lines filling cabins and adding capacity. Any shock that empties ships, a health scare, a fuel spike, a recession that cuts discretionary travel, or geopolitical disruption, hits OneSpaWorld with no ability to diversify away. Management already built in this risk, guiding with the caveat of demand softness in Europe in the back half of the year tied to geopolitical concerns (OneSpaWorld Q1 2026, Simply Wall St). A concentrated, single-industry revenue base priced for nine years of uninterrupted growth is a thin margin for error.
There is also a measurement nuance worth flagging. The trailing operating-income figures the valuation prices and the EDGAR quarterly figures diverge by roughly 19%, which means the exact multiple is sensitive to which basis you read; the premium is real either way, but the precise level should be held loosely. The balance sheet is small, with net debt near $68 million against modest liquid assets of about $16 million, so there is limited cushion if a downturn compresses cash flow at the same time the dividend and buyback commitments stand. The model concentration shows up in the cohort too: peers like Churchill Downs, United Parks, and Cinemark are all leisure names exposed to the same discretionary-spending cycle. The bull case is a beautiful monopoly; the bear case is that beautiful monopolies on cyclical industries still get repriced hard when the cycle turns, and this one is priced as if the cycle never will.
Valuation
OneSpaWorld is the textbook shape of a durability premium: only the forward-growth method reaches the $27.53 price, while every static frame sits well below it. DCF Exit Multiple lands at $27.37, essentially the price, and DCF Perpetual Growth at $15.28, but the asset, earnings-power, and peer-multiple families are far lower, with Earnings Power Value at $3.93, the book-value methods near $8 to $10, EV/EBITDA Relative at $7.56, and the FCF-yield methods near $5 to $6.
The inversion makes the bet precise. At today's price the market pays about 33x company-wide operating income, and the model solves not for a growth rate but for a horizon: growth held near the 25% self-funding ceiling for about nine years, computed at a 10.7% cost of capital, where each point of cost of capital moves the implied horizon about 1.9 years. That places the priced-in assumption in elevated territory: the near-term growth rate is within what OneSpaWorld has delivered, but the price requires that rate to persist far longer than the base rate for such businesses. One technical note: the trailing operating-income basis the inversion prices differs from the EDGAR quarterly basis by about 19%, so treat the exact 33x multiple as approximate. The conclusion is unchanged: this is a quality franchise priced for a long, uninterrupted compounding runway, defensible if the moat holds and expensive if the cruise cycle wobbles.
Catalysts
OneSpaWorld reported Q1 2026 results on May 4, 2026, with revenue up 13% to $247.6 million, operating income up 36% to $22.9 million, net income up 40% to $21.3 million ($0.21 diluted EPS), and adjusted EBITDA up 21% to $32.2 million (OneSpaWorld Q1 2026, stocktitan). Health and wellness centers operated on 208 ships at quarter end, average weekly revenue per ship reached $91,872, and Medi-Spa services were on 155 ships. The company introduced centers on Norwegian's Luna and the Disney Adventure, with six total new ship-builds on track for the year.
The forward setup is a raised guide against a flagged risk. Management lifted full-year 2026 guidance to $1.014 billion to $1.034 billion in revenue and $129 million to $139 million in adjusted EBITDA, while explicitly noting potential demand softness in Europe in the back half tied to geopolitical concerns (OneSpaWorld Q1 2026, Simply Wall St). The catalysts to track are the quarterly cadence of revenue days, average guest spend, and ship count as new builds come online; the European demand trend management called out; the rollout of higher-margin Medi-Spa services across more ships; and the pace of capital return through the dividend and buyback. Because the franchise is tethered to cruising, broad cruise-line occupancy and capacity data are leading indicators worth watching alongside the company's own prints.
Peer Cohorts (Per Segment, With Filing Citations)
Core business (reported)
- MTN (Vail Resorts, Inc.)
- FY2025 10-K: …Lodging Segment Operations within the Lodging segment include: (i) ownership/management of a group of luxury hotels through the RockResorts brand proximate to our Colorado and Utah mountain resorts; (ii) ownership/management of non-RockResorts branded hotels and condominiums proximate to our North American Resorts;…
- FY2025 10-K: …segment, which represents hotels achieving the highest average daily rates ("ADR") in the industry, and includes such brands as the Four Seasons, Ritz-Carlton and Marriott's Luxury Collection hotels. Our other hotels are categorized in the upper upscale and upscale segments of the hotel market. The luxury and upper…
- PRKS (United Parks & Resorts Inc.)
- FY2025 10-K: …assessment of the effectiveness of our internal controls over financial reporting. Because we operate in a competitive industry, our revenues, profits or market share could be harmed if we are unable to compete effectively. Our theme parks compete with other theme, water and amusement parks and with other types of…
- FY2025 10-K: …for growth. Theme parks offer a strong consumer value proposition, particularly when compared to other forms of out-of-home entertainment such as concerts, sporting events, cruises and movies. As a result, theme parks attract a broad range of guests and generally exhibit strong operating margin across regions,…
- FUN (Six Flags Entertainment Corporation/NEW)
- FY2025 10-K: …outside of the parks. Growth and innovation strategies require significant commitments of management resources and investments may not grow revenues at the rate expected or at all. As a result, the Company may not be able to recover the costs incurred in developing new projects and initiatives, or to realize their…
- FY2025 10-K: …and the quality of its food and entertainment. There may be a material adverse effect on the Company's business, financial condition or results of operations if it is unable to effectively compete with other entertainment alternatives. The operating season at most of the parks is of limited duration, which can…
- MSGE (MADISON SQUARE GARDEN ENTERTAINMENT CORP.)
- FY2025 10-K: …alternative uses for the public's entertainment dollars. The primary geographic area in which we operate, New York City, is among the most competitive entertainment markets in the world, with extensive performing arts venues, numerous major professional sports teams, and countless museums, galleries, movie theaters,…
- FY2025 10-K: …financial information that is available and regularly reviewed by its CODM. The Company's CODM is the Company's Executive Chairman and CEO. The Company's MSG Entertainment segment derives revenues primarily from entertainment offerings held at its venues that drive ticket sales and other ticket-related revenues,…
- CHDN (Churchill Downs Inc)
- FY2025 10-K: …be impacted. Competition for the type of talent we seek to hire continues to be a challenge in the geographic areas in which we operate. As a result, we may incur significant costs to attract and retain highly skilled employees. We may be unable to attract and retain the personnel necessary to sustain our business or…
- FY2025 10-K: …racing, gaming, and other services. • For the Gaming segment, revenue is disaggregated by location given the geographic economic factors that affect the revenue of Gaming service offerings. Within the Gaming segment, revenue is further disaggregated between live and simulcast racing, racing event-related services,…
Methodology Note
- Priced-in inversion: the valuation is inverted on the current price to recover the operating-income growth, duration, and steady-state margin the price embeds (ROE for financials, FFO growth for REITs).
- Valuation x-ray: the valuation models, grouped into four families (asset, earnings, relative, growth). Each model is expressed as a price/FV ratio (distance from price), not a point fair-value estimate. The spread across families is the disagreement.
- Solvency: net cash/debt, net-debt-to-NOPAT, interest coverage, and share-count CAGR from EDGAR financials (net debt / FFO and fixed-charge coverage for REITs; regulatory-capital framing for financials).
- Peer cohorts: per-segment comparables with deep-linkable SEC filing citations.
Fundamentals sourced from SEC EDGAR filings. Current price from Databento. The priced-in inversion and valuation x-ray are computed by the boothcheck engine; narrative composed by AI from the structured data.