HTHTH World Group Limited
Is the business good?
The checks split: earnings fully cash-backed (1.7×) and margins widening, but returns that lean on debt.
Operating profit is fully backed by cash. Conversion is worsening vs a year ago.
Positive operating leverage, operating profit is growing faster than sales, so margins widen as the business scales.
Leverage-amplified, a high assets-to-equity ratio does much of the work. ROE 40% = margin × turnover × leverage.
Unless marked, from derived.
Where this answer is blind. The F-score rewards improvement, so an already-elite company can score mid-pack.
How good a business is HTHT?
H World Group Limited earns 62% on the capital it employs against a 9.0% cost of capital, so the business is worth more the bigger it gets.
Return on invested capital · cost of capital 9.0% · 53 points above what the capital costs: growth creates value
- Operating margin
- 27%
Operating margin · Lodging median 23% · fiscal year to FY2025
- Cash conversion
- 1.75×
Cash conversion · 2.21× a year ago · operating cash flow covers the operating profit after tax
- Share count, year on year
- −0.94%
Share count, year on year · flat: no meaningful dilution
| Year | Operating margin |
|---|---|
| FY2020 | −17% |
| FY2021 | 1.3% |
| FY2022 | −2.1% |
| FY2023 | 22% |
| FY2024 | 22% |
| FY2025 | 27% |
Details›
- Gross marginfiscal year to FY2025
- 100%
- Operating marginfiscal year to FY2025
- 27%
- Net marginfiscal year to FY2025
- 20%
- Free cash flow margin
- 30%
- Revenue, trailing twelve months
- $25.3B
- Free cash flow, trailing twelve months
- $7.55B
- Net income, trailing twelve months
- $5.08B
- Return on invested capitaloperating profit after tax ÷ debt + equity − cash
- 62%
Margins, capital and share counts from the statements as filed with the SEC; cash conversion is operating cash flow over operating profit after tax.