Value
8.4/10data confidence 100%| Component | Sub-score |
|---|---|
| P/E | 9.5 |
| P/S | 10.0 |
| EV/EBITDA | 6.9 |
| Fwd P/E | 9.6 |
| PEG | 10.0 |
| Analyst target | 5.0 |
- ▸Forward P/E: 7.9x
- ▸PEG: 0.04
- ▸Attractively valued
HGV · Why this verdict
Why Hilton Grand Vacations (HGV) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results. How we score · Editorial policy
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VerdictSELL
Overall score6.8/10
ConfidenceMEDIUM
MacroNEUTRAL
TrendMatrix Research · core thesis
Engine thesis — one sentence
Hilton Grand Vacations screens attractively valued at a forward P/E of 8.7x and a PEG of 0.04, with strong earnings growth potential and a recent beat reversing a prior miss streak, but below-average business quality, three prior consecutive quarters of earnings misses, 11% short interest, and high-severity counterparty concentration in its Hilton licensing relationship leave the risk/reward unfavorable at the current price.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
The company missed earnings estimates in three consecutive quarters by an average of roughly 32% before delivering a 68% beat in its most recent quarter — a reversal that is encouraging but too early to declare a sustained trend given the prior pattern. Earnings | The company delivers positive EPS surprises in at least 2 of the next 3 quarters, confirming the recent beat is the beginning of a durable recovery. | ↑Improving |
| CounterA single large beat after three consecutive misses may reflect a particularly favorable quarter or a low-bar estimate rather than genuine operational improvement; the prior year's miss trend was broad and consistent. | ||
Dependence on a single licensing agreement with one major counterparty for brand access and distribution is a high-severity concentration risk; a renegotiation, non-renewal, or deterioration in that relationship would materially impair the business's competitive position and revenues. Bear case | No adverse change to the licensing terms is disclosed in the next annual filing and revenue remains within 5% of prior-year levels on a same-store basis. | ↓Deteriorating |
| CounterLong-term hospitality brand licensing agreements typically carry substantial economic penalties for early termination, providing contractual stability even if the underlying relationship with the licensor evolves over time. | ||
With a forward price-to-earnings multiple of 8.7x and a PEG ratio of 0.04, the stock trades at a significant discount to its earnings growth rate, suggesting the market is either skeptical about execution or pricing in meaningful business risk that may prove overstated if results improve. Valuation breakdown | Forward price-to-earnings expands above 12x within 12 months as earnings consistency improves and the execution risk discount moderates. | →Stable |
| CounterVacation ownership businesses can carry substantial inventory, consumer receivables, and default risk that makes a low multiple appropriate; the below-average quality profile in the data suggests the multiple may reflect genuine structural risk rather than unrecognized opportunity. | ||
With short interest at approximately 11% of the float, a significant proportion of market participants are positioned against the stock, creating a headwind to near-term appreciation and signaling that sophisticated investors see material downside risk the current price may not reflect. Risk breakdown | Short interest falls below 6% of the float over the next 6 months, indicating the short thesis is being unwound. | ↓Deteriorating |
| CounterElevated short interest can rapidly reverse into a tailwind if results improve, as short sellers are forced to cover; consistent earnings delivery could accelerate a short squeeze and amplify any recovery in the stock. | ||
The company missed earnings estimates in three consecutive quarters by an average of roughly 32% before delivering a 68% beat in its most recent quarter — a reversal that is encouraging but too early to declare a sustained trend given the prior pattern.
↑ImprovingEarnings
- Expectation
- The company delivers positive EPS surprises in at least 2 of the next 3 quarters, confirming the recent beat is the beginning of a durable recovery.
CounterA single large beat after three consecutive misses may reflect a particularly favorable quarter or a low-bar estimate rather than genuine operational improvement; the prior year's miss trend was broad and consistent.
Dependence on a single licensing agreement with one major counterparty for brand access and distribution is a high-severity concentration risk; a renegotiation, non-renewal, or deterioration in that relationship would materially impair the business's competitive position and revenues.
↓DeterioratingBear case
- Expectation
- No adverse change to the licensing terms is disclosed in the next annual filing and revenue remains within 5% of prior-year levels on a same-store basis.
CounterLong-term hospitality brand licensing agreements typically carry substantial economic penalties for early termination, providing contractual stability even if the underlying relationship with the licensor evolves over time.
With a forward price-to-earnings multiple of 8.7x and a PEG ratio of 0.04, the stock trades at a significant discount to its earnings growth rate, suggesting the market is either skeptical about execution or pricing in meaningful business risk that may prove overstated if results improve.
→StableValuation breakdown
- Expectation
- Forward price-to-earnings expands above 12x within 12 months as earnings consistency improves and the execution risk discount moderates.
CounterVacation ownership businesses can carry substantial inventory, consumer receivables, and default risk that makes a low multiple appropriate; the below-average quality profile in the data suggests the multiple may reflect genuine structural risk rather than unrecognized opportunity.
With short interest at approximately 11% of the float, a significant proportion of market participants are positioned against the stock, creating a headwind to near-term appreciation and signaling that sophisticated investors see material downside risk the current price may not reflect.
↓DeterioratingRisk breakdown
- Expectation
- Short interest falls below 6% of the float over the next 6 months, indicating the short thesis is being unwound.
CounterElevated short interest can rapidly reverse into a tailwind if results improve, as short sellers are forced to cover; consistent earnings delivery could accelerate a short squeeze and amplify any recovery in the stock.
Per-dimension breakdown
Quality
6.3/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 9.6 |
| ROA | 3.5 |
| Gross margin | 1.7 |
| Op margin | 10.0 |
| Net margin | 3.9 |
| Current ratio | 7.3 |
| FCF quality | 7.3 |
| Moat | 6.0 |
| Piotroski F | 7.8 |
- ▸Excellent ROE: 29%
- ▸Strong Piotroski F-Score: 7/9
Growth
10.0/10data confidence 33%| Component | Sub-score |
|---|---|
| Rev growth | 10.0 |
- ▸Strong growth: 55% YoY
Momentum
8.0/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 2.7 |
| MACD | 10.0 |
| OBV | 10.0 |
| MA position | 6.0 |
| Volume | 10.0 |
| vol acceleration | 9.3 |
- ▸Overbought bear rally (RSI 75)
- ▸Volume accumulation (rising OBV)
- ▸Below 200-MA, MA slope -3.1%/30d — confirmed downtrend
- ▸Volume surge (2.6x avg) on up move
Sentiment
6.1/10data confidence 100%| Component | Sub-score |
|---|---|
| LLM sentiment | 3.4 |
| Analyst rating | 7.0 |
| Price target | 7.7 |
- ▸LLM news sentiment: -0.32 (n=5)
- ▸Analyst upside: 20%
Insider
4.4/10data confidence 75%| Component | Sub-score |
|---|---|
| materiality | 4.5 |
| holder change | 3.7 |
| notable moves | 5.0 |
- ▸Modest insider selling — $970,408 (0.033% of mkt cap)
Peer rank
6.8/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 6.6 |
| quality rank | 7.1 |
| growth rank | 9.2 |
- ▸Industry growth leader
Technical
1.8/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 0.0 |
| support resistance | 0.6 |
| 52w position | 4.8 |
Risk (lower is worse)
2.5/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 1.8 |
| days to cover | 3.6 |
| volatility | 2.5 |
| put call | 0.0 |
| implied vol | 3.6 |
| max pain risk | 3.0 |
| beta | 4.6 |
| debt equity | 0.0 |
| news risk | 3.0 |
- ▸High short interest: 16%
- ▸Elevated put/call: 6.50
- ▸Above max pain $20
- ▸Concentration risks: 1 HIGH, 1 MED (10-K Item 1A — sized via position_sizing, validated via buy_confidence)
Catalyst
6.3/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 3.3 |
| earnings timing | 5.0 |
| surprise avg | 10.0 |
| news activity | 8.0 |
- ▸Earnings concerns: 2B/2M
How the verdict was assembled
Engine trigger
Extreme risk factors.
Engine technical detail
verdict_path:
L1:HARD_BLOCK:RISK_FLOORPassed (5)
- MOMENTUM:8.0>=5.5
- INSIDER:OK
- EARNINGS_PROXIMITY:114d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (1)
- ASYMMETRY:0.3<1.5@spot
Warning (2)
- DEATH_CROSS:momentum=8.0>=5.0 recovering
- 8K_CSUITE_CHANGE:5.02 (officer departure/appointment)
Reward-to-Risk
0.32
Upside
+4.7%
Downside
15.0%
Sizing output
AVOID
SetupRecovery — Death cross but MACD improving, RSI 75
EdgeNo clear edge — No clear edge identified
SuitabilityAggressive — Beta 1.61>1.3, MCap $2.9B<$5B
Investment implication
The SELL_IF_HOLDING verdict reflects the ASYMMETRY gate's 0.3<1.5@spot outcome against Growth at 10.0 and asymmetric R:R of 0.32.
The strongest dimensions are Growth at 10.0, Value at 8.4, and Momentum at 8.0; the weakest are Technical at 1.8, Risk (lower is worse) at 2.5, and Insider at 4.4. The V9 engine flagged 1 failed gate with 2 warnings, producing an asymmetric reward-to-risk of 0.32 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Earnings Miss History Recent Recovery
Trip ifEPS surprise exceeds 10% for 2 consecutive quarters, confirming the earnings recovery is sustained.
- P2Compelling Valuation Discount
Trip ifForward price-to-earnings expands above 14x, indicating the valuation discount has closed.
- P3High Short Interest Headwind
Trip ifShort interest falls below 5% of the float, indicating the short position has substantially unwound.
- P4Hilton License Concentration Risk
Trip ifA new licensing or distribution partnership is announced that would reduce single-counterparty brand revenue dependence below 70% on a pro-forma basis.