H World Group Limited American Depositary Shares (HTHT)

FairStock Score: 59/100 — STEADY

Key Financials

AI Analysis

AI-generated, general educational analysis — not personal investment advice.

I approach H World as a hotel operator in China with leased/owned, manachised, and franchised hotels. In the latest filed quarter, fiscal Q2 2026, revenue was $7.1B and net income was $1.6B, a 22.15% net margin. That is a real business generating cash. But the balance sheet and returns are mixed. FairStock calculates ROE of 38.13%, yet ROCE is only 7.45% and debt-to-equity is 2.40. FairStock's Altman Z-Score of 0.55 warns of financial distress risk under that model, even as the Piotroski F-Score is 9/9. Cash flow looks strong: trailing free cash flow is $8.0B, a 50.1% FCF yield, and EV/EBITDA is 4.01. Yet at the close on 2026-10-13, the price was $44.17, giving a FairStock P/E of 31.55 and P/B of 6.64. The Graham Number is $12.01, so the margin of safety versus that conservative measure is -267.78%. The dividend yield is 4.99%, and beta is 0.13, suggesting low volatility. Growth is uneven: the supplied data show revenue growth of 11.14% and profit growth of -8.61%, though the exact period is not labeled. The FairStock Score is 59/100, and no Lynch category applies because only zero years of filed results are available, needing three. The hotel industry is cyclical and competitive. Brands and scale help, but China exposure and leverage matter. At this price, I see neither a cigar butt nor a wide-moat bargain. I would demand a clearer margin of safety and consistent profit growth before calling it compelling.

In plain English: H World Group runs hotels in China under brands like HanTing, JI, Ibis, and others. It is profitable, with $1.6B of net income in fiscal Q2 2026, and it generates a lot of cash, but the stock price looks high compared with several conservative value measures and the company carries meaningful debt. Overall, it looks like a solid but cyclical business at a full-to-expensive price, not a clear bargain.

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Data as of 2026-10-13 close · note generated 2026-10-15 · model deepseek-flash

Fundamentals from company filings and market-data providers; prices are end-of-day, not real-time. AI-generated analysis is general and educational — not personal investment advice. Scoring methodology · Score test · Disclaimer