BREAD FINANCIAL HOLDINGS INC (BFH) Stock Fundamental Analysis
NYSE:BFH - New York Stock Exchange, Inc. - US0185811082 - Common Stock - Currency: USD
Taking everything into account, BFH scores 4 out of 10 in our fundamental rating. BFH was compared to 52 industry peers in the Consumer Finance industry. While BFH is still in line with the averages on profitability rating, there are concerns on its financial health. BFH has a bad growth rate and is valued cheaply.
1. Profitability
1.1 Basic Checks
In the past year BFH was profitable.
BFH had a positive operating cash flow in the past year.
In the past 5 years BFH has always been profitable.
In the past 5 years BFH always reported a positive cash flow from operatings.
1.2 Ratios
BFH has a Return On Assets (1.25%) which is in line with its industry peers.
The Return On Equity of BFH (9.13%) is comparable to the rest of the industry.
BFH's Return On Invested Capital of 4.36% is fine compared to the rest of the industry. BFH outperforms 61.54% of its industry peers.
BFH had an Average Return On Invested Capital over the past 3 years of 4.40%. This is significantly below the industry average of 10.31%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.25% | ||
| ROE | 9.13% | ||
| ROIC | 4.36% |
ROA(3y)1.73%
ROA(5y)1.96%
ROE(3y)14.51%
ROE(5y)19.2%
ROIC(3y)4.4%
ROIC(5y)4.64%
1.3 Margins
BFH has a Profit Margin of 6.11%. This is in the lower half of the industry: BFH underperforms 65.38% of its industry peers.
BFH's Profit Margin has been stable in the last couple of years.
With an excellent Operating Margin value of 28.52%, BFH belongs to the best of the industry, outperforming 86.54% of the companies in the same industry.
BFH's Operating Margin has been stable in the last couple of years.
BFH's Gross Margin of 93.00% is amongst the best of the industry. BFH outperforms 88.46% of its industry peers.
In the last couple of years the Gross Margin of BFH has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 28.52% | ||
| PM (TTM) | 6.11% | ||
| GM | 93% |
OM growth 3Y-9.81%
OM growth 5Y0.65%
PM growth 3Y-35.19%
PM growth 5Y0.78%
GM growth 3Y0.66%
GM growth 5Y0.7%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), BFH is creating some value.
BFH has less shares outstanding than it did 1 year ago.
Compared to 5 years ago, BFH has more shares outstanding
Compared to 1 year ago, BFH has an improved debt to assets ratio.
2.2 Solvency
Based on the Altman-Z score of 0.92, we must say that BFH is in the distress zone and has some risk of bankruptcy.
Looking at the Altman-Z score, with a value of 0.92, BFH is in the better half of the industry, outperforming 65.38% of the companies in the same industry.
BFH has a debt to FCF ratio of 10.23. This is a negative value and a sign of low solvency as BFH would need 10.23 years to pay back of all of its debts.
BFH has a Debt to FCF ratio (10.23) which is in line with its industry peers.
BFH has a Debt/Equity ratio of 5.94. This is a high value indicating a heavy dependency on external financing.
BFH's Debt to Equity ratio of 5.94 is on the low side compared to the rest of the industry. BFH is outperformed by 76.92% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 5.94 | ||
| Debt/FCF | 10.23 | ||
| Altman-Z | 0.92 |
ROIC/WACC1.52
WACC2.86%
2.3 Liquidity
A Current Ratio of 1.52 indicates that BFH should not have too much problems paying its short term obligations.
The Current ratio of BFH (1.52) is comparable to the rest of the industry.
BFH has a Quick Ratio of 1.52. This is a normal value and indicates that BFH is financially healthy and should not expect problems in meeting its short term obligations.
BFH has a Quick ratio of 1.52. This is comparable to the rest of the industry: BFH outperforms 59.62% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.52 | ||
| Quick Ratio | 1.52 |
3. Growth
3.1 Past
The earnings per share for BFH have decreased strongly by -11.04% in the last year.
BFH shows a very negative growth in Earnings Per Share. Measured over the last years, the EPS has been decreasing by -15.20% yearly.
Looking at the last year, BFH shows a decrease in Revenue. The Revenue has decreased by -4.58% in the last year.
BFH shows a decrease in Revenue. Measured over the last years, the Revenue has been decreasing by -0.19% yearly.
EPS 1Y (TTM)-11.04%
EPS 3Y-25.81%
EPS 5Y-15.2%
EPS Q2Q%2.96%
Revenue 1Y (TTM)-4.58%
Revenue growth 3Y8.3%
Revenue growth 5Y-0.19%
Sales Q2Q%-2.12%
3.2 Future
BFH is expected to show a decrease in Earnings Per Share. In the coming years, the EPS will decrease by -1.18% yearly.
Based on estimates for the next years, BFH will show a small growth in Revenue. The Revenue will grow by 3.25% on average per year.
EPS Next Y-2.73%
EPS Next 2Y10.68%
EPS Next 3Y9.95%
EPS Next 5Y-1.18%
Revenue Next Year0.08%
Revenue Next 2Y2.08%
Revenue Next 3Y3.11%
Revenue Next 5Y3.25%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
BFH is valuated reasonably with a Price/Earnings ratio of 8.15.
Based on the Price/Earnings ratio, BFH is valued a bit cheaper than the industry average as 75.00% of the companies are valued more expensively.
BFH is valuated cheaply when we compare the Price/Earnings ratio to 27.45, which is the current average of the S&P500 Index.
A Price/Forward Earnings ratio of 6.73 indicates a rather cheap valuation of BFH.
BFH's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. BFH is cheaper than 78.85% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of BFH to the average of the S&P500 Index (21.90), we can say BFH is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 8.15 | ||
| Fwd PE | 6.73 |
4.2 Price Multiples
88.46% of the companies in the same industry are more expensive than BFH, based on the Enterprise Value to EBITDA ratio.
Based on the Price/Free Cash Flow ratio, BFH is valued cheaper than 88.46% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 1.58 | ||
| EV/EBITDA | 2.67 |
4.3 Compensation for Growth
The decent profitability rating of BFH may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y10.68%
EPS Next 3Y9.95%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 1.39%, BFH has a reasonable but not impressive dividend return.
BFH's Dividend Yield is comparable with the industry average which is at 3.66.
Compared to an average S&P500 Dividend Yield of 2.42, BFH's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.39% |
5.2 History
The dividend of BFH decreases each year by -19.10%.
BFH has been paying a dividend for at least 10 years, so it has a reliable track record.
BFH has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)-19.1%
Div Incr Years0
Div Non Decr Years3
5.3 Sustainability
BFH pays out 15.71% of its income as dividend. This is a sustainable payout ratio.
BFH's earnings and Dividend Rate are declining. This means the current dividend is most likely not sustainable.
DP15.71%
EPS Next 2Y10.68%
EPS Next 3Y9.95%
60.4
+0.52 (+0.87%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupFinancial Services
GICS IndustryConsumer Finance
Earnings (Last)
Earnings (Next)
Inst Owners108.41%
Inst Owner ChangeN/A
Ins Owners0.99%
Ins Owner Change13.02%
Market Cap2.81B
Analysts69
Price Target57.44 (-4.9%)
Short Float %8.55%
Short Ratio4.89
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.39% |
Yearly Dividend0.87
Dividend Growth(5Y)-19.1%
DP15.71%
Div Incr Years0
Div Non Decr Years3
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-17.93%
Min EPS beat(2)-58.34%
Max EPS beat(2)22.48%
EPS beat(4)2
Avg EPS beat(4)2.55%
Min EPS beat(4)-58.34%
Max EPS beat(4)48.84%
EPS beat(8)5
Avg EPS beat(8)124.28%
EPS beat(12)8
Avg EPS beat(12)79.12%
EPS beat(16)10
Avg EPS beat(16)63.5%
Revenue beat(2)1
Avg Revenue beat(2)-2.17%
Min Revenue beat(2)-5.07%
Max Revenue beat(2)0.74%
Revenue beat(4)2
Avg Revenue beat(4)-1.09%
Min Revenue beat(4)-5.07%
Max Revenue beat(4)0.8%
Revenue beat(8)4
Avg Revenue beat(8)0.96%
Revenue beat(12)8
Avg Revenue beat(12)5.84%
Revenue beat(16)9
Avg Revenue beat(16)2.05%
PT rev (1m)1.53%
PT rev (3m)-18.48%
EPS NQ rev (1m)2.28%
EPS NQ rev (3m)-1.92%
EPS NY rev (1m)-1.45%
EPS NY rev (3m)2.54%
Revenue NQ rev (1m)0.11%
Revenue NQ rev (3m)-0.7%
Revenue NY rev (1m)-0.28%
Revenue NY rev (3m)-0.88%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 8.15 | ||
| Fwd PE | 6.73 | ||
| P/S | 0.61 | ||
| P/FCF | 1.58 | ||
| P/OCF | 1.56 | ||
| P/B | 0.92 | ||
| P/tB | 1.21 | ||
| EV/EBITDA | 2.67 |
EPS(TTM)7.41
EY12.27%
EPS(NY)8.98
Fwd EY14.87%
FCF(TTM)38.26
FCFY63.34%
OCF(TTM)38.78
OCFY64.2%
SpS98.45
BVpS65.91
TBVpS50.05
PEG (NY)N/A
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.25% | ||
| ROE | 9.13% | ||
| ROCE | 14.08% | ||
| ROIC | 4.36% | ||
| ROICexc | 5.37% | ||
| ROICexgc | 6.07% | ||
| OM | 28.52% | ||
| PM (TTM) | 6.11% | ||
| GM | 93% | ||
| FCFM | 38.86% |
ROA(3y)1.73%
ROA(5y)1.96%
ROE(3y)14.51%
ROE(5y)19.2%
ROIC(3y)4.4%
ROIC(5y)4.64%
ROICexc(3y)5.33%
ROICexc(5y)5.71%
ROICexgc(3y)5.64%
ROICexgc(5y)6.71%
ROCE(3y)16.5%
ROCE(5y)14.09%
ROICexcg growth 3Y3.7%
ROICexcg growth 5Y-10.26%
ROICexc growth 3Y3.14%
ROICexc growth 5Y-6.25%
OM growth 3Y-9.81%
OM growth 5Y0.65%
PM growth 3Y-35.19%
PM growth 5Y0.78%
GM growth 3Y0.66%
GM growth 5Y0.7%
F-Score6
Asset Turnover0.2
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 5.94 | ||
| Debt/FCF | 10.23 | ||
| Debt/EBITDA | 13.06 | ||
| Cap/Depr | 27.27% | ||
| Cap/Sales | 0.52% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 129.39% | ||
| Profit Quality | 636.07% | ||
| Current Ratio | 1.52 | ||
| Quick Ratio | 1.52 | ||
| Altman-Z | 0.92 |
F-Score6
WACC2.86%
ROIC/WACC1.52
Cap/Depr(3y)47.19%
Cap/Depr(5y)47.85%
Cap/Sales(3y)1.11%
Cap/Sales(5y)1.41%
Profit Quality(3y)575.46%
Profit Quality(5y)552.61%
High Growth Momentum
Growth
EPS 1Y (TTM)-11.04%
EPS 3Y-25.81%
EPS 5Y-15.2%
EPS Q2Q%2.96%
EPS Next Y-2.73%
EPS Next 2Y10.68%
EPS Next 3Y9.95%
EPS Next 5Y-1.18%
Revenue 1Y (TTM)-4.58%
Revenue growth 3Y8.3%
Revenue growth 5Y-0.19%
Sales Q2Q%-2.12%
Revenue Next Year0.08%
Revenue Next 2Y2.08%
Revenue Next 3Y3.11%
Revenue Next 5Y3.25%
EBIT growth 1Y-8.41%
EBIT growth 3Y-2.32%
EBIT growth 5Y0.46%
EBIT Next Year-70.19%
EBIT Next 3Y-28.03%
EBIT Next 5YN/A
FCF growth 1Y5.38%
FCF growth 3Y7.71%
FCF growth 5Y11.13%
OCF growth 1Y3.2%
OCF growth 3Y6.41%
OCF growth 5Y8.83%