InterContinental Hotels Group (FRA:IC1B) Gross Margin % Explanation
Warren Buffett believes that firms with excellent long term economics tend to have consistently higher margins.
Durable competitive advantage creates a high Gross Margin % because of the freedom to price in excess of cost. Companies can be categorized by their Gross Margin %
1. Greater than 40% = Durable competitive advantage
2. Less than 40% = Competition eroding margins
3. Less than 20% = no sustainable competitive advantage
Consistency of Gross Margin is key
InterContinental Hotels Group had a gross margin of 35.92% for the quarter that ended in Dec. 2025 => Competition eroding margins
Be Aware
If a company loses its competitive advantages, usually its gross margin declines well before its sales declines. Watching Gross Margin % and Operating Margin % closely helps avoid value trap situations.
InterContinental Hotels Group Gross Margin % Related Terms
InterContinental Hotels Group Gross Margin % Historical Data
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
InterContinental Hotels Group Gross Margin % Chart
FRA:IC1B vs MAR, HLT, H: Gross Margin % Comparison
For the Lodging subindustry, InterContinental Hotels Group's Gross Margin %, along with its competitors' market caps and Gross Margin % data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
InterContinental Hotels Group Gross Margin % vs Travel & Leisure Industry
For the Travel & Leisure industry and Consumer Cyclical sector, InterContinental Hotels Group's Gross Margin % distribution charts can be found below:
* The bar in red indicates where InterContinental Hotels Group's Gross Margin % falls into.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
A positive Gross Profit is only the first step for a company to make a net profit. The gross profit needs to be big enough to also cover related labor, equipment, rental, marketing/advertising, research and development and a lot of other costs in selling the products.
InterContinental Hotels Group (FRA:IC1B) has a Gross Margin % of 35.92% as of Dec. 2025. Gross margin is the ratio of total gross profit to net sales. View historical data on InterContinental Hotels Group and its competitors. This is 25% above median its historical median of 28.76. Over the past decade, InterContinental Hotels Group's Gross Margin % has ranged from 22.39 to 31.26. According to the industry distribution chart, InterContinental Hotels Group ranks #553 out of 790 companies in the Travel & Leisure industry, placing it in the top 70%.
Is InterContinental Hotels Group's Gross Margin % too high?
InterContinental Hotels Group's current Gross Margin % of 35.92% is 25% above median its 10-year median of 28.76. Over the past 10 years, this metric has ranged from a low of 22.39 to a high of 31.26. The Travel & Leisure industry median Gross Margin % is 44.09. InterContinental Hotels Group's value of 35.92% is 18.5% below this industry median. Based on the distribution chart, InterContinental Hotels Group ranks #553 out of 790 companies in the Travel & Leisure industry, which is below the industry midpoint. Overall, InterContinental Hotels Group has a GF Score™ of 91/100 and is considered Modestly Overvalued, reflecting its overall financial health beyond just this single metric.
How does InterContinental Hotels Group's Gross Margin % compare to MAR and HLT?
According to the Travel & Leisure industry distribution chart, InterContinental Hotels Group ranks #553 out of 790 companies for Gross Margin %. This places InterContinental Hotels Group in the lower half of its industry. The industry median Gross Margin % is 44.09. InterContinental Hotels Group's value of 35.92% is 18.5% below this benchmark. Historically, InterContinental Hotels Group's own Gross Margin % has ranged from 22.39 to 31.26 over the past decade. While the company's 10-year median is 28.76 vs. the industry median of 44.09, InterContinental Hotels Group has consistently been below the industry average. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good Gross Margin % for a Travel & Leisure company?
The median Gross Margin % among Travel & Leisure companies is 44.09, based on 790 companies in the industry. Companies in the top quartile (top 25%) have a Gross Margin % significantly above this median, while those in the bottom quartile fall well below. However, Gross Margin % should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. InterContinental Hotels Group's current Gross Margin % of 35.92% is 18.5% below the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high Gross Margin % mean?
A high Gross Margin % can signal that a stock is expensive relative to its fundamentals. Gross margin is the ratio of total gross profit to net sales. View historical data on InterContinental Hotels Group and its competitors. For the Travel & Leisure industry, the median Gross Margin % is 44.09 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. InterContinental Hotels Group's current Gross Margin % is 35.92%, which is 25% above median its own 10-year median of 28.76. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is InterContinental Hotels Group stock overvalued right now?
Based on GuruFocus' analysis, InterContinental Hotels Group (FRA:IC1B) is currently considered Modestly Overvalued. The stock's GF Value™ is €117.18, compared to a current price of €149.00 — trading 27.2% above its estimated fair value. The current Gross Margin % is 35.92%, which is 25% above median its 10-year median of 28.76 and 18.5% below the Travel & Leisure industry median of 44.09. InterContinental Hotels Group's overall GF Score™ is 91/100 with 6 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is Gross Margin % calculated?
Gross Margin % is calculated from a company's financial statements. For InterContinental Hotels Group (FRA:IC1B), the current Gross Margin % is 35.92% as of Dec. 2025. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is InterContinental Hotels Group (FRA:IC1B) Overvalued in 2026?
Based on GuruFocus' analysis, InterContinental Hotels Group stock appears to be overvalued.
The current stock price of €149.00 is trading 27.2% above its estimated GF Value™ of €117.18.
GuruFocus considers InterContinental Hotels Group to be Modestly Overvalued.
Key valuation signals for FRA:IC1B:
Gross Margin %: 35.92% (25% above median its 10-year median of 28.76)
GF Value™: €117.18 vs. price of €149.00 (27.2% above fair value)
Industry Position: 18.5% below the Travel & Leisure median (#553 of 790)
No single metric tells the full story. See the FRA:IC1B stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
InterContinental Hotels Group Business Description
InterContinental Hotels Group operates 1 million rooms across 20 brands addressing the midscale through luxury segments, as of Dec. 31, 2025. Holiday Inn and Holiday Inn Express constitute the largest brand, while Hotel Indigo, Even, Hualuxe, Kimpton, and Voco are newer lifestyle brands experiencing strong demand. The company launched a midscale brand, Avid, in 2017 and closed on a 51% stake in Regent Hotels in 2018. It acquired Six Senses in 2019 and launched another midscale brand, Garner, in 2023, followed by a premium conversion brand, Noted Collections, in 2026. Managed and franchised represent 99% of total rooms. As of Dec. 31, 2025, the Americas represented 52% of total rooms, with Greater China accounting for 20% and Europe, Asia, the Middle East, and Africa making up 28%.
91GF Score
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