Park Hotels & Resorts Inc. (PK): what the price assumes
In the published model solve dated 2026-Q2, anchored at $14.93, Park Hotels & Resorts Inc. (PK) is priced for +8.8% growth. 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/PK
Headline
| Field | Value |
|---|---|
| Ticker | PK |
| Company | Park Hotels & Resorts Inc. |
| Current price | $14.93/sh |
| Composition | Rooms 59% / Food and beverage 27% / Ancillary hotel 10% / Other 4% |
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) | 4.4% |
| Operating margin (mid-cycle) | 13.0% |
| Margin compression (value-band) | -8.6pp |
| Trailing margin (depressed year) | 0.9% |
| Implied growth | 8.8% |
| Multiple paid | 20x mid-cycle operating income |
The operating-margin figure is value-band context at year 12: derived from the framework's value band, a separate calculation — not part of the priced-in solve.
Solve inputs: computed at a 8.1% cost of capital with 4% terminal growth over a 5-year stage; each 1pp of cost of capital moves the implied operating-profit growth ~7.3pp.
Reconcile: at the x-ray's 9.3% required return this reads ~17%/yr; the models below use their own rates.
How unusual the bet is: within-range (limited comparison data)
| Reference | Value |
|---|---|
| vs own history | +0.67σ |
| implied end-window share | 0% |
Valuation X-Ray
The price is supported by asset-based value, while growth-DCF lands below the price. A value/asset-supported name, not a pure growth bet.
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 | 1.06x | 3 | expensive |
| Earnings | — | 0 | — |
| Relative | — | 0 | — |
| Growth | 2.58x | 1 | expensive |
Families that justify the price: Asset Families that call it expensive: Growth
The models below discount at their own flat-beta convention rates (cost of equity 9.3%, WACC 4.7%); the inversion above states its own rate.
Per-Model Detail (n=4)
| Model | Family | FV | Price/FV | Applicable | Methodology |
|---|---|---|---|---|---|
| DCF Perpetual Growth | Growth | $0.00 | — | no | FCF base $0.1B, growth -2% (input: historical growth), terminal g 0.5%, WACC 4.7%, 5yr projection |
| DCF Exit Multiple | Growth | $11.61 | 1.29x | no | Exit EV/EBITDA: 16.9x / 18.9x / 20.9x (bear / base = today's held flat / bull), 5yr |
| Relative Valuation | Relative | — | — | no | P/S fallback (negative EPS): Sector P/S 2.5x × TTM revenue — excluded from consensus |
| Simple DDM | Growth | $5.79 | 2.58x | yes | DPS $1.00, g=-6.8% (sustainable: ROE (TTM) × retention; not the terminal-growth assumption), ke=9.3% |
| Two-Stage DDM | Growth | $-0.32 | — | no | Stage 1: -136% for 5yr, Stage 2: 3.5% perpetual |
| Simple Excess Return | Asset | $15.72 | 0.95x | yes | Reference only (book value floor): BV/sh $15.71, ROE negative |
| Two-Stage Excess Return | Asset | $14.14 | 1.06x | yes | Reference only (book value with convergence): BV/sh $15.71, ROE converges to ke |
| Discounted Future Market Cap | Growth | $8.86 | 1.69x | no | Rev $2.5B, growth -2% (input: historical growth; tapered), Terminal P/S: 1.0x / 1.2x / 1.4x (bear / base = today's held flat / bull, cap 8x) |
| Peter Lynch Fair Value | Relative | $0.00 | — | no | Negative/zero EPS — earnings-based value floored at $0 |
| Margin Trajectory | Growth | — | — | no | — |
| Earnings Power Value | Earnings | $2.56 | 5.83x | no | Normalized EBIT (5y avg op income, one-time charges added back) $0.22B × (1−8%) / WACC 4.7% → EPV (no growth) |
| Residual Income | Asset | — | — | no | — |
| Graham Number | Asset | — | — | no | — |
| EV/EBITDA Relative | Relative | — | — | no | EBITDA $0.35B × sector EV/EBITDA 12.0x |
| FCF Yield | Earnings | $0.01 | 1493.00x | yes | FCF $69.0M / Kₑ 9.3% — zero-growth perpetuity (excluded from median) |
| SBC-Adj FCF Yield | Earnings | $0.01 | 1493.00x | yes | SBC-adj FCF $0.05B (FCF $0.07B − SBC $0.02B) capitalized at Kₑ (excluded from median) |
| Ben Graham Formula | Earnings | — | — | no | — |
| ROIC-Justified P/B | Asset | $2.78 | 5.37x | yes | BV $15.71 × (ROIC 0.8% / WACC 4.7%) |
| P/Sales Sector | Relative | — | — | no | Revenue $2.53B × sector P/S 2.5x |
| PEG Fair Value | Relative | — | — | no | — |
| Earnings Yield | Earnings | — | — | no | — |
| Funds From Operations Multiple | Relative | — | — | no | — |
| Clinical Phase NPV | Growth | — | — | no | — |
| Merton | Asset | — | — | no | — |
| V5 Mechanical | — | — | — | no | — |
Economic-Unit Decomposition (Sum Of The Parts)
One or more material disclosed units has unresolved economics. Unknown/general is not evidence of homogeneity: segment SOTP is primary but incomplete, consolidated cash flow may remain only a secondary cross-check when every unit shares an enterprise basis, and one sector multiple or target margin is withheld.
| Unit | Role | Valuation basis | Revenue | Reported profit | Value evidence | Status |
|---|---|---|---|---|---|---|
| Core Hotels | operating | enterprise | $2.0b | — | withheld | unresolved no unit value |
| Non-Core Hotels | operating | enterprise | $443.0m | — | withheld | unresolved no unit value |
No total common-equity value is stated. One or more material units lack a supported unit value. The displayed values are an indicative subtotal; consolidated debt and cash cannot be applied to a fraction of the company.
Solvency
| Field | Value |
|---|---|
| Net debt | $3.7b |
| Net debt / NOPAT (after-tax) | 12.16x |
| Net debt / operating income (pre-tax) | 11.23x |
| Interest coverage | 1.6x |
| Share count CAGR (buyback) | -4.0% |
| Burning cash | no |
Leverage and coverage are computed on normalized mid-cycle operating income (mid-cycle margin 13.0%); the trailing year was depressed.
Bullet Takeaways
- At about $15 the price sits essentially at book value, near $15.71 per share, and the only valuation family that reaches the price is the asset-based one. The relative and growth frames say the price is rich on trailing operating income, which is depressed, so this is an asset-supported name being read through a weak earnings window.
- The defining fact is leverage. Net debt is roughly $3.7B against only $156M of cash, and the company has about $1.4B of mortgage loans maturing in the fourth quarter of 2026, including the $1.275B financing on its largest asset, the Hilton Hawaiian Village. The thesis turns on refinancing and asset sales, not on operations alone.
- Q1 2026 was operationally solid: comparable RevPAR up 5.5% excluding a property under renovation, hotel adjusted EBITDA of $152M at a roughly 26% margin, and AFFO guidance nudged up. The business works; the question is whether the capital structure gives it time.
Bull Case
Read Park through its balance sheet and capital plan, because that is where management is telling you how it sees the business. The company carries roughly $3.7B of net debt, but it ended Q1 2026 with about $2 billion of total liquidity: $156M of cash plus roughly $1.8B of available capacity. That cushion exists because management has been deliberately recycling capital, divesting non-core hotels and using the proceeds to cut leverage and reinvest in the core portfolio. The 10-K states the strategy plainly: divest non-core hotels to enhance portfolio quality and long-term growth, while using sale proceeds to reduce leverage, reinvest in the core, and increase shareholder value. A management team that is actively selling assets to delever and still funding renovations is signaling confidence that the core portfolio is worth more than the market's near-book quote.
The operations underneath support that confidence. Q1 2026 beat, with comparable hotel RevPAR up 5.5% year over year (excluding the Royal Palm property under renovation since May 2025), resort RevPAR up 7.6% on leisure strength, hotel adjusted EBITDA of $152M at roughly a 26% margin, and AFFO guidance raised by a cent to a $1.74 to $1.90 range with full-year RevPAR guidance lifted 50 basis points. The renovations are themselves a forward lever: management is investing in Hawaii and other core assets specifically to drive future earnings growth. A lodging portfolio posting mid-single-digit RevPAR gains and raising its cash-flow guidance is not a broken business, it is a leveraged one in a recovering demand environment.
The valuation math is the clearest part of the bull case. The price trades essentially at book value, about $15 (June 27, 2026).71 per share, and the asset family is the only frame that reaches it, which makes sense for a hotel REIT whose value is the real estate. The inverted price implies about 8.6% company-wide operating growth, which the engine flags as within the range Park has recently delivered, so the stretch is duration rather than rate. With trailing operating income depressed by the cycle and by renovation disruption, the earnings-based models read the price as expensive, but those are exactly the models that mis-fit an asset-heavy, FFO-driven business. If the asset sales close at reasonable values and the refinancings clear, the equity is being offered at the value of the underlying hotels with the recovery as optionality.
Bear Case
The structural truth a holder must face is that Park is cheap because of what is deteriorating around the equity, not in spite of it: the price sits near book because the balance sheet is stretched and a maturity wall is bearing down. Net debt is roughly $3.7B against only $156M of cash, and trailing operating income of about $22M does not begin to cover the debt service, with interest coverage near 0.1x on the EDGAR trailing read. The firm trips three distress signals (sustained net losses, negative retained earnings, and an Altman distress reading), and while those partly reflect REIT depreciation accounting, the leverage is real. When the asset family is the only valuation frame that supports the price and the earnings frames all say expensive, the equity is a thin sliver on top of a large, fixed claim, which is precisely the configuration that punishes a holder if asset values slip.
The near-term pressure point is refinancing. The 10-K discloses about $1.4 billion of mortgage loans maturing, with the company intending to draw on its 2025 Delayed Draw Term Loan to help repay them, and the largest piece is the $1.275 billion CMBS on the Hilton Hawaiian Village, the company's biggest asset at 2,886 rooms, due in early November 2026. The plan is to combine the term-loan draw with a new mortgage on the Bonnet Creek complex to retire that CMBS. That is a coherent plan, but it is a plan that depends on the financing markets staying open and on lenders valuing the collateral favorably, and the Hawaiian Village posted only 0.9% RevPAR growth, the softest in the portfolio, right as it needs to be financed. Refinancing risk on a single asset of this size is a concentrated, externally controlled variable the near-book price does not fully discount.
The disposition program carries its own friction. As of late April 2026 the non-core initiative still had 12 hotels with 4,977 rooms to sell, nine identified for sale, plus three properties under Safehold ground leases where disposition timing is uncertain because of ongoing litigation. Selling hotels to delever works only if the bids arrive at acceptable prices, and a litigation-clouded ground-lease situation is exactly the kind of asset that trades at a discount or not at all. The 10-K is candid that economic conditions, reduced travel, lower consumer confidence, pandemics, and adverse politics can all lower hotel revenues and profitability. Layer that demand sensitivity on top of a refinancing wall and a half-finished asset-sale program, and the bear case is straightforward: the operations can be fine and the equity can still be the wrong place to sit if the capital structure does not resolve cleanly.
Valuation
Park is an asset story trading at an asset price, and the valuation has to be read that way. At about $15 the stock sits essentially at book value of $15.71 per share, and the asset family is the only one of the four that reaches the price: the two-stage excess-return reference and the book-value floor both land near the quote. The relative and growth families read the price as expensive, but that is a measurement artifact, because trailing operating income of roughly $22M is depressed by renovation disruption and the lodging cycle, and capitalizing a trough number understates a real-estate-heavy business. The inverted price implies about 8.6% company-wide operating growth over five years, solved at an 8.1% cost of capital, and the engine notes that pace is within Park's recent range, so the implied bet is on persistence rather than an unusual rate.
The model set is thin here by design. The projection-based methods, the perpetual-growth DCF, the discounted future market cap, and the earnings-power value, are gated off because three distress signals make those methods unreliable for a firm in this financial state, and the dividend models break on a negative sustainable growth rate. The ROIC-justified book multiple lands well below the price because reported ROIC is near zero, again a function of depreciation and a soft earnings window rather than the economic value of the hotels. The honest read is that GAAP earnings frames do not fit a leveraged hotel REIT, the right yardstick is the property value net of debt and the AFFO the portfolio generates, and the asset frame proxies that better than the earnings frames do.
The synthesis is that the equity is priced at the net asset value the market currently ascribes to the hotels, with essentially no premium for recovery and no discount beyond the leverage already visible. The number is therefore not a steady-state estimate but a function of whether the capital structure resolves, which is the correct way to value a near-book, highly levered REIT.
Catalysts
The catalysts cluster tightly around the back half of 2026 and the balance sheet. Park reported Q1 2026 on May 1, 2026, beating with $0.45 of EPS, hotel adjusted EBITDA of $152M, comparable RevPAR up 5.5% excluding the property under renovation, and it raised AFFO guidance by a cent to $1.74 to $1.90 and lifted full-year RevPAR guidance by 50 basis points to 0.5% to 2.5%. The operating trajectory is constructive, but the events that move the equity most are financing milestones. The company intends to draw on its delayed-draw term loan in June to repay the $121M Hyatt Regency Boston mortgage, then draw the remainder in September alongside a planned Bonnet Creek mortgage to retire the $1.275B Hilton Hawaiian Village CMBS maturing in early November. Each of those steps closing on schedule and at reasonable cost would de-risk the thesis materially; any slippage would amplify it.
The other live catalyst is the disposition program. Park sold the Hilton Seattle Airport Hotel and additional non-core assets for $31M in the quarter, and as of late April still had a dozen non-core hotels to sell, nine identified, plus three Safehold ground-lease properties whose timing is uncertain pending litigation. Asset-sale announcements at firm prices reduce leverage and validate the net-asset-value case, while a stalled program or weak bids would do the opposite. On sentiment, the sell side is cautious, with a Hold-leaning consensus across roughly 9 to 26 analysts and price targets clustered near $12 to $14, around or modestly below the current quote, reflecting the refinancing overhang. The variables to track are the November HHV refinancing, the pace and pricing of non-core sales, and RevPAR at the Hawaiian Village specifically, which grew just 0.9% and is the asset most central to both the cash flows and the financing.
Peer Cohorts (Per Segment, With Filing Citations)
Core Hotels / Non-Core Hotels (reported)
- HST (HOST HOTELS & RESORTS, INC.)
- FY2025 10-K: …destination locations with limited supply growth. These assets feature superior amenities and unique experiential offerings; • Convention destination hotels that are group oriented in urban and resort markets. These assets feature extensive and high-quality meeting facilities and often are connected to prominent…
- FY2025 10-K: Venture. We own a 49.9% interest in a joint venture with R/V-C Association that owns the 650-room Fort Lauderdale Marriott Harbor Beach Resort & Spa in Florida. The joint venture has a $176 million mortgage loan outstanding on the hotel that is non-recourse to us. Asia/Pacific Joint Venture. We have a 25% interest in…
- PEB (PEBBLEBROOK HOTEL TRUST)
- FY2025 10-K: …equity securities and debt financings having staggered maturities. Our debt includes senior unsecured credit facilities, term loans, convertible debt, unsecured notes and mortgage debt secured by our hotel properties and may in the future include other unsecured debt. We anticipate using net proceeds from equity and…
- FY2025 10-K: …also opportunistically target investments in resort properties located near our primary urban target markets and select destination resort markets such as southern Florida and southern California. We focus on both branded and independent full-service "upper-upscale" hotels. The full-service hotels on which we focus…
- DRH (DIAMONDROCK HOSPITALITY CO)
- FY2025 10-K: EC. Overview DiamondRock Hospitality Company (the "Company", "we", or "our") is a self-managed and self-administered lodging-focused real estate investment trust ("REIT") that owns a portfolio of premium hotels and resorts. As of December 31, 2025, we owned 35 hotels with 9,595 rooms located in 26 markets in the…
- FY2025 10-K: …hotel that is directly owned by a TRS. The following chart shows our corporate structure as of the date of this report: -9- Table of Contents Competition The hotel industry is highly competitive and our hotels are subject to competition from other hotels for guests. Competition is based on a number of factors,…
- XHR (Xenia Hotels & Resorts, Inc.)
- FY2025 10-K: ) in each of their markets on the basis of several factors, including, among others, room rates, quality of accommodations, service levels and amenities, location, brand affiliation, reputation and reservation systems. Competition is often specific to the individual markets in which our hotels are located and includes…
- FY2025 10-K: …private sources, including external consultants engaged by us; and alerts and reports produced by security tools deployed in the corporate IT environment. 39 Item 2. Properties We lease our corporate headquarters located at 200 S. Orange Avenue, Suite 2700, Orlando, Florida 32801. Hotel Properties As of December 31,…
- SHO (Sunstone Hotel Investors, Inc.)
- FY2025 10-K: …in the IT environment . 32 Table of Contents Item 2. Properties The following table sets forth additional summary information with respect to our hotels as of December 31, 2025: Hotel City State Chain Scale Segment Rooms Manager Andaz Miami Beach Miami Beach Florida Luxury…
- FY2025 10-K: …Worldwide Holdings Inc. ("Hilton"), Montage North America, LLC ("Montage"), Sage Hospitality Group ("Sage") and Singh Hospitality, LLC ("Singh") (aka EOS Hospitality), each a manager of one of the Company's hotels. Competitive Strengths We believe the following competitive strengths distinguish us from other…
- RHP (RYMAN HOSPITALITY PROPERTIES, INC.)
- FY2025 10-K: …accessible through our website, is not incorporated by reference in, or considered to be part of, this Report on Form 10-K or any document unless expressly incorporated by reference therein. Competition Hospitality Our current hotel properties compete with numerous other hotels throughout the United States and…
- FY2025 10-K: …presented. Business Segments Hospitality The Hospitality segment includes the Gaylord Hotels properties, the JW Marriott properties (including, effective June 10, 2025, JW Marriott Desert Ridge and effective June 30, 2023, JW Marriott Hill Country), the Inn at Opryland and the AC Hotel, each of which is managed by…
- APLE (APPLE HOSPITALITY REIT, INC.)
- FY2025 10-K: …Company owns hotels may adversely affect the Company's results of operations. The hotel industry is highly competitive. Each of the Company's hotels competes for guests primarily with other hotels in its immediate vicinity and secondarily with other hotels in its geographic market. The Company also competes with…
- FY2025 10-K: …real estate, primarily in the lodging sector, in the United States ("U.S."). The Company has elected to be treated as a REIT for U.S. federal income tax purposes. As of December 31, 2025, the Company owned 217 hotels with an aggregate of 29,583 guest rooms located in urban, high-end suburban and developing markets…
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.
- Economic-unit decomposition (SOTP): each disclosed business unit is assigned its native valuation basis before any multiple is applied. Operating units are valued on enterprise value; funded financial units are valued on their own common equity, because their borrowings fund earning assets rather than levering the parent. A company total is stated only once every material unit carries a supported value and the parent capital bridge reconciles.
- 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.