AVIENT CORP (AVNT) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:AVNT - US05368V1061 - Common Stock
36.42 USD
-0.29 (-0.79%)
AVNT gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 83 industry peers in the Chemicals industry. While AVNT belongs to the best of the industry regarding profitability, there are concerns on its financial health. AVNT has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
- In the past year AVNT was profitable.
- AVNT had a positive operating cash flow in the past year.
- In the past 5 years AVNT has always been profitable.
- In the past 5 years AVNT always reported a positive cash flow from operatings.
1.2 Ratios
- Looking at the Return On Assets, with a value of 1.87%, AVNT is in the better half of the industry, outperforming 61.45% of the companies in the same industry.
- The Return On Equity of AVNT (4.78%) is better than 63.86% of its industry peers.
- AVNT's Return On Invested Capital of 5.04% is fine compared to the rest of the industry. AVNT outperforms 61.45% of its industry peers.
- AVNT had an Average Return On Invested Capital over the past 3 years of 4.38%. This is in line with the industry average of 6.11%.
- The last Return On Invested Capital (5.04%) for AVNT is above the 3 year average (4.38%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.87% | ||
| ROE | 4.78% | ||
| ROIC | 5.04% |
ROA(3y)5.25%
ROA(5y)4.61%
ROE(3y)13.57%
ROE(5y)12.29%
ROIC(3y)4.38%
ROIC(5y)4.85%
1.3 Margins
- AVNT's Profit Margin of 3.49% is fine compared to the rest of the industry. AVNT outperforms 65.06% of its industry peers.
- In the last couple of years the Profit Margin of AVNT has declined.
- AVNT has a Operating Margin (10.19%) which is comparable to the rest of the industry.
- AVNT's Operating Margin has improved in the last couple of years.
- The Gross Margin of AVNT (32.21%) is better than 62.65% of its industry peers.
- In the last couple of years the Gross Margin of AVNT has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 10.19% | ||
| PM (TTM) | 3.49% | ||
| GM | 32.21% |
OM growth 3Y2.89%
OM growth 5Y12%
PM growth 3Y-9.09%
PM growth 5Y-23.95%
GM growth 3Y3.39%
GM growth 5Y6.91%
2. Health
2.1 Basic Checks
- The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so AVNT is destroying value.
- AVNT has more shares outstanding than it did 1 year ago.
- AVNT has more shares outstanding than it did 5 years ago.
- Compared to 1 year ago, AVNT has a worse debt to assets ratio.
2.2 Solvency
- AVNT has an Altman-Z score of 1.84. This is not the best score and indicates that AVNT is in the grey zone with still only limited risk for bankruptcy at the moment.
- Looking at the Altman-Z score, with a value of 1.84, AVNT is in line with its industry, outperforming 48.19% of the companies in the same industry.
- AVNT has a debt to FCF ratio of 13.05. This is a negative value and a sign of low solvency as AVNT would need 13.05 years to pay back of all of its debts.
- Looking at the Debt to FCF ratio, with a value of 13.05, AVNT is in line with its industry, outperforming 55.42% of the companies in the same industry.
- AVNT has a Debt/Equity ratio of 0.83. This is a neutral value indicating AVNT is somewhat dependend on debt financing.
- The Debt to Equity ratio of AVNT (0.83) is worse than 60.24% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.83 | ||
| Debt/FCF | 13.05 | ||
| Altman-Z | 1.84 |
ROIC/WACC0.44
WACC11.34%
2.3 Liquidity
- A Current Ratio of 2.03 indicates that AVNT has no problem at all paying its short term obligations.
- AVNT's Current ratio of 2.03 is in line compared to the rest of the industry. AVNT outperforms 54.22% of its industry peers.
- AVNT has a Quick Ratio of 1.47. This is a normal value and indicates that AVNT is financially healthy and should not expect problems in meeting its short term obligations.
- Looking at the Quick ratio, with a value of 1.47, AVNT is in line with its industry, outperforming 57.83% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.03 | ||
| Quick Ratio | 1.47 |
3. Growth
3.1 Past
- The Earnings Per Share has been growing slightly by 2.23% over the past year.
- The Earnings Per Share has been growing slightly by 4.25% on average over the past years.
- The Revenue has been growing slightly by 1.03% in the past year.
- AVNT shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 2.51% yearly.
EPS 1Y (TTM)2.23%
EPS 3Y-4.35%
EPS 5Y4.25%
EPS Q2Q%7.69%
Revenue 1Y (TTM)1.03%
Revenue growth 3Y-0.76%
Revenue growth 5Y2.51%
Sales Q2Q%-1.07%
3.2 Future
- Based on estimates for the next years, AVNT will show a quite strong growth in Earnings Per Share. The EPS will grow by 8.67% on average per year.
- AVNT is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 1.99% yearly.
EPS Next Y7.87%
EPS Next 2Y8.22%
EPS Next 3Y8.67%
EPS Next 5YN/A
Revenue Next Year0.18%
Revenue Next 2Y1.29%
Revenue Next 3Y1.99%
Revenue Next 5YN/A
3.3 Evolution
- The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
- When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
- With a Price/Earnings ratio of 13.24, AVNT is valued correctly.
- Compared to the rest of the industry, the Price/Earnings ratio of AVNT indicates a somewhat cheap valuation: AVNT is cheaper than 79.52% of the companies listed in the same industry.
- AVNT's Price/Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 28.82.
- Based on the Price/Forward Earnings ratio of 11.69, the valuation of AVNT can be described as reasonable.
- 81.93% of the companies in the same industry are more expensive than AVNT, based on the Price/Forward Earnings ratio.
- The average S&P500 Price/Forward Earnings ratio is at 25.95. AVNT is valued rather cheaply when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.24 | ||
| Fwd PE | 11.69 |
4.2 Price Multiples
- Based on the Enterprise Value to EBITDA ratio, AVNT is valued a bit cheaper than the industry average as 61.45% of the companies are valued more expensively.
- Compared to the rest of the industry, the Price/Free Cash Flow ratio of AVNT indicates a somewhat cheap valuation: AVNT is cheaper than 67.47% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 22.07 | ||
| EV/EBITDA | 9.47 |
4.3 Compensation for Growth
- AVNT's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
- AVNT has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)1.68
PEG (5Y)3.11
EPS Next 2Y8.22%
EPS Next 3Y8.67%
5. Dividend
5.1 Amount
- AVNT has a Yearly Dividend Yield of 2.92%. Purely for dividend investing, there may be better candidates out there.
- AVNT's Dividend Yield is a higher than the industry average which is at 2.23.
- AVNT's Dividend Yield is rather good when compared to the S&P500 average which is at 1.82.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.92% |
5.2 History
- The dividend of AVNT has a limited annual growth rate of 5.71%.
- AVNT has paid a dividend for at least 10 years, which is a reliable track record.
- AVNT has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)5.71%
Div Incr Years13
Div Non Decr Years13
5.3 Sustainability
- AVNT pays out 86.14% of its income as dividend. This is not a sustainable payout ratio.
- AVNT's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP86.14%
EPS Next 2Y8.22%
EPS Next 3Y8.67%
AVIENT CORP / AVNT FAQ
Can you provide the ChartMill fundamental rating for AVIENT CORP?
ChartMill assigns a fundamental rating of 5 / 10 to AVNT.
Can you provide the valuation status for AVIENT CORP?
ChartMill assigns a valuation rating of 6 / 10 to AVIENT CORP (AVNT). This can be considered as Fairly Valued.
How profitable is AVIENT CORP (AVNT) stock?
AVIENT CORP (AVNT) has a profitability rating of 7 / 10.
What is the valuation of AVIENT CORP based on its PE and PB ratios?
The Price/Earnings (PE) ratio for AVIENT CORP (AVNT) is 13.24 and the Price/Book (PB) ratio is 1.41.
Can you provide the expected EPS growth for AVNT stock?
The Earnings per Share (EPS) of AVIENT CORP (AVNT) is expected to grow by 7.87% in the next year.