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1. Company Snapshot

1.a. Company Description

PPHE Hotel Group Limited owns, develops, leases, operates, and franchises full-service upscale and lifestyle hotels in the Netherlands, Germany, Hungary, Serbia, Italy, Austria, and the United Kingdom.It owns and operates hotels and resorts under the Park Plaza, the art'otel, and the Arena Campsites brands, as well as the Arena Hotels & Apartments.As of December 31, 2021, the company operated 48 properties with approximately 9,100 rooms; and 5,800 campsite pitches in Croatia.


It also operates restaurants and bars; and a coffee shop.The company was formerly known as Park Plaza Hotels Limited and changed its name to PPHE Hotel Group Limited in March 2012.PPHE Hotel Group Limited was founded in 1986 and is based in Amsterdam, the Netherlands.

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1.b. Last Insights on PPH

The recent performance of PPHE Hotel Group Limited has been driven by a series of positive developments. The company's decision to increase its dividend to £0.21, a 10% hike from the previous year, is a testament to its commitment to shareholder value. Furthermore, the stock's inclusion in a list of FTSE 350 "bargain" stocks that have outperformed the market long-term highlights its undervalued nature. This, coupled with the absence of any negative news, suggests a favorable business environment for the company.

1.c. Company Highlights

2. Transcript Summary

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3. NewsRoom

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Form 8.3

Nov -24

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PPHE plans to run formal sale process amid strategic review

Nov -24

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PPHE hotel group investors consider stake sale

Nov -14

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UK Growth Companies With Insider Ownership Up To 36%

Nov -07

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PPHE Hotel Group transitions to Oracle OPERA Cloud PMS

Nov -05

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PPHE Hotel Group Implements Oracle OPERA Cloud to Improve Operations and Drive Innovation

Nov -04

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UK Growth Companies That Insiders Heavily Invest In

Oct -09

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Do These 3 Checks Before Buying PPHE Hotel Group Limited (LON:PPH) For Its Upcoming Dividend

Sep -14

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4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (5.04%)

6. Segments

Owned Hotel

Expected Growth: 5%

Strong RevPAR growth driven by increasing demand from business and leisure travelers, effective yield management, and strategic location in key cities. Additionally, PPHE's focus on renovation and rebranding initiatives, coupled with a solid balance sheet and efficient cost management, have contributed to the 5% growth of Owned Hotels segment.

Management and Central Services

Expected Growth: 7%

Strong management expertise, efficient cost control, and strategic investments in technology drove 7% growth in Management and Central Services at PPHE Hotel Group Limited. Effective revenue management, improved operational efficiencies, and a focus on customer experience also contributed to this growth.

7. Detailed Products

Hotels

PPHE Hotel Group Limited operates a diverse portfolio of hotels across Europe, offering a range of accommodation options from budget-friendly to luxury.

Food and Beverage

The company offers a variety of dining options, including restaurants, bars, and cafes, serving a range of cuisines from fine dining to casual eats.

Meetings and Events

PPHE Hotel Group Limited provides meeting and event spaces, catering to conferences, weddings, and other functions, with dedicated event planners and state-of-the-art facilities.

Spa and Wellness

The company offers spa and wellness facilities, including fitness centers, saunas, and treatment rooms, providing a range of relaxing and rejuvenating experiences.

Loyalty Program

PPHE Hotel Group Limited operates a loyalty program, rewarding repeat customers with exclusive benefits, discounts, and perks.

8. PPHE Hotel Group Limited's Porter Forces

Forces Ranking

Threat Of Substitutes

PPHE Hotel Group Limited operates in a highly competitive industry, and customers have various alternatives to choose from. However, the company's strong brand reputation and loyalty programs help to mitigate the threat of substitutes.

Bargaining Power Of Customers

Customers have a high bargaining power due to the availability of numerous hotel options and online travel agencies. This forces PPHE Hotel Group Limited to maintain competitive pricing and high-quality services to retain customers.

Bargaining Power Of Suppliers

PPHE Hotel Group Limited has a diversified supplier base, which reduces the bargaining power of individual suppliers. The company's scale of operations also gives it negotiating power when dealing with suppliers.

Threat Of New Entrants

While there are barriers to entry in the hotel industry, such as high capital requirements and regulatory hurdles, new entrants can still disrupt the market. PPHE Hotel Group Limited needs to maintain its competitive edge through innovation and strategic partnerships.

Intensity Of Rivalry

The hotel industry is highly competitive, with numerous players vying for market share. PPHE Hotel Group Limited faces intense rivalry from established brands and new entrants, making it essential to focus on differentiating its services and maintaining a strong brand reputation.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 73.95%
Debt Cost 4.30%
Equity Weight 26.05%
Equity Cost 9.26%
WACC 5.59%
Leverage 283.88%

11. Quality Control: PPHE Hotel Group Limited passed 2 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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NH Hotel Group

A-Score: 6.0/10

Value: 6.9

Growth: 7.7

Quality: 6.6

Yield: 0.0

Momentum: 8.5

Volatility: 6.3

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Meliá Hotels

A-Score: 5.8/10

Value: 7.5

Growth: 6.8

Quality: 5.7

Yield: 1.9

Momentum: 5.5

Volatility: 7.7

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Dalata Hotel

A-Score: 5.4/10

Value: 5.3

Growth: 7.4

Quality: 4.9

Yield: 2.5

Momentum: 9.5

Volatility: 3.0

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Scandic Hotels

A-Score: 5.4/10

Value: 5.0

Growth: 5.4

Quality: 4.6

Yield: 3.8

Momentum: 7.0

Volatility: 6.7

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Pierre et Vacances

A-Score: 4.7/10

Value: 6.9

Growth: 7.4

Quality: 3.4

Yield: 0.0

Momentum: 7.0

Volatility: 3.7

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PPHE Hotel Group

A-Score: 4.3/10

Value: 3.4

Growth: 5.6

Quality: 3.1

Yield: 2.5

Momentum: 7.0

Volatility: 4.3

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

18.12$

Current Price

18.12$

Potential

-0.00%

Expected Cash-Flows