AVIENT CORP (AVNT) Stock Fundamental Analysis
NYSE:AVNT - New York Stock Exchange, Inc. - US05368V1061 - Common Stock - Currency: USD
AVNT gets a fundamental rating of 4 out of 10. The analysis compared the fundamentals against 85 industry peers in the Chemicals industry. While AVNT is still in line with the averages on profitability rating, there are concerns on its financial health. AVNT is not valued too expensively and it also shows a decent growth rate.
1. Profitability
1.1 Basic Checks
AVNT had positive earnings in the past year.
AVNT had a positive operating cash flow in the past year.
AVNT had positive earnings in each of the past 5 years.
In the past 5 years AVNT always reported a positive cash flow from operatings.
1.2 Ratios
AVNT has a Return On Assets of 1.72%. This is comparable to the rest of the industry: AVNT outperforms 56.47% of its industry peers.
AVNT has a Return On Equity (4.35%) which is in line with its industry peers.
AVNT has a Return On Invested Capital (4.26%) which is in line with its industry peers.
AVNT had an Average Return On Invested Capital over the past 3 years of 5.06%. This is in line with the industry average of 6.84%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.72% | ||
| ROE | 4.35% | ||
| ROIC | 4.26% |
ROA(3y)5.25%
ROA(5y)4.61%
ROE(3y)13.57%
ROE(5y)12.29%
ROIC(3y)5.06%
ROIC(5y)5.26%
1.3 Margins
AVNT's Profit Margin of 3.09% is in line compared to the rest of the industry. AVNT outperforms 58.82% of its industry peers.
AVNT's Profit Margin has declined in the last couple of years.
The Operating Margin of AVNT (8.25%) is comparable to the rest of the industry.
AVNT's Operating Margin has improved in the last couple of years.
AVNT has a Gross Margin of 33.13%. This is in the better half of the industry: AVNT outperforms 63.53% of its industry peers.
AVNT's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 8.25% | ||
| PM (TTM) | 3.09% | ||
| GM | 33.13% |
OM growth 3Y6.37%
OM growth 5Y14.26%
PM growth 3Y-9.09%
PM growth 5Y-23.95%
GM growth 3Y4.52%
GM growth 5Y7.61%
2. Health
2.1 Basic Checks
AVNT has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it 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.
The debt/assets ratio for AVNT is higher compared to a year ago.
2.2 Solvency
An Altman-Z score of 1.83 indicates that AVNT is not a great score, but indicates only limited risk for bankruptcy at the moment.
AVNT has a Altman-Z score of 1.83. This is comparable to the rest of the industry: AVNT outperforms 48.24% of its industry peers.
The Debt to FCF ratio of AVNT is 14.94, which is on the high side as it means it would take AVNT, 14.94 years of fcf income to pay off all of its debts.
The Debt to FCF ratio of AVNT (14.94) is comparable to the rest of the industry.
A Debt/Equity ratio of 0.90 indicates that AVNT is somewhat dependend on debt financing.
Looking at the Debt to Equity ratio, with a value of 0.90, AVNT is doing worse than 63.53% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.9 | ||
| Debt/FCF | 14.94 | ||
| Altman-Z | 1.83 |
ROIC/WACC0.5
WACC8.5%
2.3 Liquidity
A Current Ratio of 2.05 indicates that AVNT has no problem at all paying its short term obligations.
AVNT has a Current ratio (2.05) which is in line with its industry peers.
AVNT has a Quick Ratio of 1.51. This is a normal value and indicates that AVNT is financially healthy and should not expect problems in meeting its short term obligations.
With a decent Quick ratio value of 1.51, AVNT is doing good in the industry, outperforming 65.88% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.05 | ||
| Quick Ratio | 1.51 |
3. Growth
3.1 Past
AVNT shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 7.26%.
Measured over the past 5 years, AVNT shows a small growth in Earnings Per Share. The EPS has been growing by 4.25% on average per year.
Looking at the last year, AVNT shows a small growth in Revenue. The Revenue has grown by 3.58% in the last year.
The Revenue has been growing slightly by 2.51% on average over the past years.
EPS 1Y (TTM)7.26%
EPS 3Y-4.35%
EPS 5Y4.25%
EPS Q2Q%0%
Revenue 1Y (TTM)3.58%
Revenue growth 3Y-0.76%
Revenue growth 5Y2.51%
Sales Q2Q%-0.29%
3.2 Future
The Earnings Per Share is expected to grow by 11.16% on average over the next years. This is quite good.
AVNT is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 2.93% yearly.
EPS Next Y7.13%
EPS Next 2Y9.97%
EPS Next 3Y11.17%
EPS Next 5YN/A
Revenue Next Year0.91%
Revenue Next 2Y2.52%
Revenue Next 3Y2.93%
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 stable.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 12.69, AVNT is valued correctly.
Based on the Price/Earnings ratio, AVNT is valued cheaper than 81.18% of the companies in the same industry.
The average S&P500 Price/Earnings ratio is at 27.30. AVNT is valued rather cheaply when compared to this.
With a Price/Forward Earnings ratio of 10.49, the valuation of AVNT can be described as very reasonable.
77.65% of the companies in the same industry are more expensive than AVNT, based on the Price/Forward Earnings ratio.
AVNT is valuated cheaply when we compare the Price/Forward Earnings ratio to 21.76, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.69 | ||
| Fwd PE | 10.49 |
4.2 Price Multiples
AVNT's Enterprise Value to EBITDA ratio is in line with the industry average.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of AVNT indicates a somewhat cheap valuation: AVNT is cheaper than 67.06% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 22.31 | ||
| EV/EBITDA | 10.49 |
4.3 Compensation for Growth
AVNT's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
PEG (NY)1.78
PEG (5Y)2.98
EPS Next 2Y9.97%
EPS Next 3Y11.17%
5. Dividend
5.1 Amount
AVNT has a Yearly Dividend Yield of 3.14%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 3.57, AVNT pays a bit more dividend than its industry peers.
Compared to an average S&P500 Dividend Yield of 2.37, AVNT pays a bit more dividend than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.14% |
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
95.30% of the earnings are spent on dividend by AVNT. This is not a sustainable payout ratio.
AVNT's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP95.3%
EPS Next 2Y9.97%
EPS Next 3Y11.17%
33.76
+0.61 (+1.84%)
Chartmill FA Rating
GICS SectorMaterials
GICS IndustryGroupMaterials
GICS IndustryChemicals
Earnings (Last)
Earnings (Next)
Inst Owners102.51%
Inst Owner Change1.08%
Ins Owners0.51%
Ins Owner Change2.34%
Market Cap3.09B
Analysts81.43
Price Target43.99 (30.3%)
Short Float %2.06%
Short Ratio3.04
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.14% |
Yearly Dividend1.03
Dividend Growth(5Y)5.71%
DP95.3%
Div Incr Years13
Div Non Decr Years13
Ex-Date
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-0.85%
Min EPS beat(2)-1.47%
Max EPS beat(2)-0.22%
EPS beat(4)2
Avg EPS beat(4)0.91%
Min EPS beat(4)-1.47%
Max EPS beat(4)3.49%
EPS beat(8)5
Avg EPS beat(8)2.54%
EPS beat(12)8
Avg EPS beat(12)7.19%
EPS beat(16)12
Avg EPS beat(16)6.08%
Revenue beat(2)0
Avg Revenue beat(2)-2.16%
Min Revenue beat(2)-2.29%
Max Revenue beat(2)-2.02%
Revenue beat(4)1
Avg Revenue beat(4)-1.27%
Min Revenue beat(4)-2.29%
Max Revenue beat(4)0.22%
Revenue beat(8)1
Avg Revenue beat(8)-2.1%
Revenue beat(12)3
Avg Revenue beat(12)1.01%
Revenue beat(16)5
Avg Revenue beat(16)-2.57%
PT rev (1m)-3.63%
PT rev (3m)-18.44%
EPS NQ rev (1m)-0.63%
EPS NQ rev (3m)-3.98%
EPS NY rev (1m)0.08%
EPS NY rev (3m)-1.59%
Revenue NQ rev (1m)-0.1%
Revenue NQ rev (3m)-1.22%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-0.54%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.69 | ||
| Fwd PE | 10.49 | ||
| P/S | 0.95 | ||
| P/FCF | 22.31 | ||
| P/OCF | 12.43 | ||
| P/B | 1.34 | ||
| P/tB | N/A | ||
| EV/EBITDA | 10.49 |
EPS(TTM)2.66
EY7.88%
EPS(NY)3.22
Fwd EY9.53%
FCF(TTM)1.51
FCFY4.48%
OCF(TTM)2.71
OCFY8.04%
SpS35.38
BVpS25.11
TBVpS-9.29
PEG (NY)1.78
PEG (5Y)2.98
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.72% | ||
| ROE | 4.35% | ||
| ROCE | 5.22% | ||
| ROIC | 4.26% | ||
| ROICexc | 4.68% | ||
| ROICexgc | 14.45% | ||
| OM | 8.25% | ||
| PM (TTM) | 3.09% | ||
| GM | 33.13% | ||
| FCFM | 4.28% |
ROA(3y)5.25%
ROA(5y)4.61%
ROE(3y)13.57%
ROE(5y)12.29%
ROIC(3y)5.06%
ROIC(5y)5.26%
ROICexc(3y)5.69%
ROICexc(5y)6.05%
ROICexgc(3y)19.27%
ROICexgc(5y)19.24%
ROCE(3y)6.19%
ROCE(5y)6.44%
ROICexcg growth 3Y1.47%
ROICexcg growth 5Y-2.8%
ROICexc growth 3Y-3.41%
ROICexc growth 5Y-3.57%
OM growth 3Y6.37%
OM growth 5Y14.26%
PM growth 3Y-9.09%
PM growth 5Y-23.95%
GM growth 3Y4.52%
GM growth 5Y7.61%
F-Score6
Asset Turnover0.56
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.9 | ||
| Debt/FCF | 14.94 | ||
| Debt/EBITDA | 4.6 | ||
| Cap/Depr | 60.71% | ||
| Cap/Sales | 3.4% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 55.44% | ||
| Profit Quality | 138.64% | ||
| Current Ratio | 2.05 | ||
| Quick Ratio | 1.51 | ||
| Altman-Z | 1.83 |
F-Score6
WACC8.5%
ROIC/WACC0.5
Cap/Depr(3y)66.22%
Cap/Depr(5y)65.36%
Cap/Sales(3y)3.56%
Cap/Sales(5y)3.15%
Profit Quality(3y)76.61%
Profit Quality(5y)81.33%
High Growth Momentum
Growth
EPS 1Y (TTM)7.26%
EPS 3Y-4.35%
EPS 5Y4.25%
EPS Q2Q%0%
EPS Next Y7.13%
EPS Next 2Y9.97%
EPS Next 3Y11.17%
EPS Next 5YN/A
Revenue 1Y (TTM)3.58%
Revenue growth 3Y-0.76%
Revenue growth 5Y2.51%
Sales Q2Q%-0.29%
Revenue Next Year0.91%
Revenue Next 2Y2.52%
Revenue Next 3Y2.93%
Revenue Next 5YN/A
EBIT growth 1Y-8.31%
EBIT growth 3Y5.57%
EBIT growth 5Y17.13%
EBIT Next Year60.7%
EBIT Next 3Y22.81%
EBIT Next 5YN/A
FCF growth 1Y-43.42%
FCF growth 3Y0.93%
FCF growth 5Y-9.24%
OCF growth 1Y-30.45%
OCF growth 3Y3.18%
OCF growth 5Y-3.11%