BREAD FINANCIAL HOLDINGS INC (BFH) Stock Fundamental Analysis
NYSE:BFH - New York Stock Exchange, Inc. - US0185811082 - Common Stock - Currency: USD
Overall BFH gets a fundamental rating of 5 out of 10. We evaluated BFH against 53 industry peers in the Consumer Finance industry. Both the profitability and the financial health of BFH get a neutral evaluation. Nothing too spectacular is happening here. BFH is cheap, but on the other hand it scores bad on growth.
1. Profitability
1.1 Basic Checks
BFH had positive earnings in the past year.
In the past year BFH had a positive cash flow from operations.
In the past 5 years BFH has always been profitable.
Each year in the past 5 years BFH had a positive operating cash flow.
1.2 Ratios
BFH has a Return On Assets (1.21%) which is in line with its industry peers.
BFH's Return On Equity of 9.05% is in line compared to the rest of the industry. BFH outperforms 49.06% of its industry peers.
BFH has a better Return On Invested Capital (4.31%) than 62.26% of its industry peers.
BFH had an Average Return On Invested Capital over the past 3 years of 4.40%. This is below the industry average of 7.45%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.21% | ||
| ROE | 9.05% | ||
| ROIC | 4.31% |
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
The Profit Margin of BFH (5.94%) is worse than 66.04% of its industry peers.
In the last couple of years the Profit Margin of BFH has remained more or less at the same level.
BFH has a Operating Margin of 28.45%. This is amongst the best in the industry. BFH outperforms 86.79% of its industry peers.
BFH's Operating Margin has been stable in the last couple of years.
BFH has a better Gross Margin (93.00%) than 90.57% 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 | 28.45% | ||
| PM (TTM) | 5.94% | ||
| 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
BFH has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
Compared to 1 year ago, BFH has less shares outstanding
Compared to 5 years ago, BFH has more shares outstanding
The debt/assets ratio for BFH has been reduced compared to a year ago.
2.2 Solvency
Based on the Altman-Z score of 0.91, we must say that BFH is in the distress zone and has some risk of bankruptcy.
The Altman-Z score of BFH (0.91) is better than 62.26% of its industry peers.
The Debt to FCF ratio of BFH is 10.22, which is on the high side as it means it would take BFH, 10.22 years of fcf income to pay off all of its debts.
Looking at the Debt to FCF ratio, with a value of 10.22, BFH is in line with its industry, outperforming 43.40% of the companies in the same industry.
A Debt/Equity ratio of 6.11 is on the high side and indicates that BFH has dependencies on debt financing.
BFH has a worse Debt to Equity ratio (6.11) than 77.36% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 6.11 | ||
| Debt/FCF | 10.22 | ||
| Altman-Z | 0.91 |
ROIC/WACC1.64
WACC2.62%
2.3 Liquidity
BFH has a Current Ratio of 1.55. 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 better Current ratio (1.55) than 60.38% of its industry peers.
BFH has a Quick Ratio of 1.55. This is a normal value and indicates that BFH is financially healthy and should not expect problems in meeting its short term obligations.
Looking at the Quick ratio, with a value of 1.55, BFH is in the better half of the industry, outperforming 60.38% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.55 | ||
| Quick Ratio | 1.55 |
3. Growth
3.1 Past
BFH shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -50.17%.
The earnings per share for BFH have been decreasing by -15.20% on average. This is quite bad
The Revenue has decreased by -4.13% in the past year.
BFH shows a decrease in Revenue. Measured over the last years, the Revenue has been decreasing by -0.19% yearly.
EPS 1Y (TTM)-50.17%
EPS 3Y-25.81%
EPS 5Y-15.2%
EPS Q2Q%-84.44%
Revenue 1Y (TTM)-4.13%
Revenue growth 3Y8.3%
Revenue growth 5Y-0.19%
Sales Q2Q%-8.95%
3.2 Future
Based on estimates for the next years, BFH will show a decrease in Earnings Per Share. The EPS will decrease by -1.51% on average per year.
The Revenue is expected to grow by 3.84% on average over the next years.
EPS Next Y-5.84%
EPS Next 2Y13.02%
EPS Next 3Y13.35%
EPS Next 5Y-1.51%
Revenue Next Year0.97%
Revenue Next 2Y3.25%
Revenue Next 3Y4.16%
Revenue Next 5Y3.84%
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 accelerating.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 6.64 indicates a rather cheap valuation of BFH.
Compared to the rest of the industry, the Price/Earnings ratio of BFH indicates a rather cheap valuation: BFH is cheaper than 81.13% of the companies listed in the same industry.
BFH's Price/Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 29.35.
The Price/Forward Earnings ratio is 7.05, which indicates a rather cheap valuation of BFH.
Compared to the rest of the industry, the Price/Forward Earnings ratio of BFH indicates a rather cheap valuation: BFH is cheaper than 83.02% of the companies listed in the same industry.
BFH's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 22.10.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 6.64 | ||
| Fwd PE | 7.05 |
4.2 Price Multiples
BFH's Enterprise Value to EBITDA ratio is rather cheap when compared to the industry. BFH is cheaper than 84.91% of the companies in the same industry.
88.68% of the companies in the same industry are more expensive than BFH, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 1.31 | ||
| EV/EBITDA | 3.02 |
4.3 Compensation for Growth
The decent profitability rating of BFH may justify a higher PE ratio.
BFH's earnings are expected to grow with 13.35% in the coming years. This may justify a more expensive valuation.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y13.02%
EPS Next 3Y13.35%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 1.70%, BFH has a reasonable but not impressive dividend return.
In the last 3 months the price of BFH has falen by -22.96%. A price decline artificially increases the dividend yield. It may be a sign investors do not expect the dividend to last.
Compared to an average industry Dividend Yield of 4.19, BFH pays a bit more dividend than its industry peers.
BFH's Dividend Yield is slightly below the S&P500 average, which is at 2.33.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.7% |
5.2 History
The dividend of BFH decreases each year by -19.10%.
BFH has paid a dividend for at least 10 years, which is 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 15.58% 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.
DP15.58%
EPS Next 2Y13.02%
EPS Next 3Y13.35%
48.68
-0.66 (-1.34%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupFinancial Services
GICS IndustryConsumer Finance
Earnings (Last)
Earnings (Next)
Inst Owners102.44%
Inst Owner ChangeN/A
Ins Owners0.81%
Ins Owner Change11.46%
Market Cap2.39B
Analysts71
Price Target72.12 (48.15%)
Short Float %4.27%
Short Ratio3.18
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.7% |
Yearly Dividend0.87
Dividend Growth(5Y)-19.1%
DP15.58%
Div Incr Years0
Div Non Decr Years3
Ex-Date
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-30.55%
Min EPS beat(2)-58.34%
Max EPS beat(2)-2.76%
EPS beat(4)1
Avg EPS beat(4)-5.91%
Min EPS beat(4)-58.34%
Max EPS beat(4)48.84%
EPS beat(8)5
Avg EPS beat(8)125.33%
EPS beat(12)7
Avg EPS beat(12)76.77%
EPS beat(16)10
Avg EPS beat(16)68.16%
Revenue beat(2)0
Avg Revenue beat(2)-2.94%
Min Revenue beat(2)-5.07%
Max Revenue beat(2)-0.82%
Revenue beat(4)1
Avg Revenue beat(4)-1.67%
Min Revenue beat(4)-5.07%
Max Revenue beat(4)0.8%
Revenue beat(8)4
Avg Revenue beat(8)3.5%
Revenue beat(12)8
Avg Revenue beat(12)6.26%
Revenue beat(16)8
Avg Revenue beat(16)1.02%
PT rev (1m)3.49%
PT rev (3m)22.79%
EPS NQ rev (1m)0.06%
EPS NQ rev (3m)44.63%
EPS NY rev (1m)0.19%
EPS NY rev (3m)24.95%
Revenue NQ rev (1m)-0.01%
Revenue NQ rev (3m)0.29%
Revenue NY rev (1m)-0.2%
Revenue NY rev (3m)0.08%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 6.64 | ||
| Fwd PE | 7.05 | ||
| P/S | 0.51 | ||
| P/FCF | 1.31 | ||
| P/OCF | 1.29 | ||
| P/B | 0.78 | ||
| P/tB | 1.04 | ||
| EV/EBITDA | 3.02 |
EPS(TTM)7.33
EY15.06%
EPS(NY)6.9
Fwd EY14.18%
FCF(TTM)37.14
FCFY76.29%
OCF(TTM)37.87
OCFY77.79%
SpS94.58
BVpS62.15
TBVpS46.95
PEG (NY)N/A
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.21% | ||
| ROE | 9.05% | ||
| ROCE | 13.47% | ||
| ROIC | 4.31% | ||
| ROICexc | 5.14% | ||
| ROICexgc | 5.77% | ||
| OM | 28.45% | ||
| PM (TTM) | 5.94% | ||
| GM | 93% | ||
| FCFM | 39.26% |
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 | 6.11 | ||
| Debt/FCF | 10.22 | ||
| Debt/EBITDA | 13.21 | ||
| Cap/Depr | 40% | ||
| Cap/Sales | 0.78% | ||
| Interest Coverage | 5.82 | ||
| Cash Conversion | 131.75% | ||
| Profit Quality | 660.51% | ||
| Current Ratio | 1.55 | ||
| Quick Ratio | 1.55 | ||
| Altman-Z | 0.91 |
F-Score6
WACC2.62%
ROIC/WACC1.64
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)-50.17%
EPS 3Y-25.81%
EPS 5Y-15.2%
EPS Q2Q%-84.44%
EPS Next Y-5.84%
EPS Next 2Y13.02%
EPS Next 3Y13.35%
EPS Next 5Y-1.51%
Revenue 1Y (TTM)-4.13%
Revenue growth 3Y8.3%
Revenue growth 5Y-0.19%
Sales Q2Q%-8.95%
Revenue Next Year0.97%
Revenue Next 2Y3.25%
Revenue Next 3Y4.16%
Revenue Next 5Y3.84%
EBIT growth 1Y-18.61%
EBIT growth 3Y-2.32%
EBIT growth 5Y0.46%
EBIT Next Year-69.12%
EBIT Next 3Y-23.25%
EBIT Next 5YN/A
FCF growth 1Y-5.98%
FCF growth 3Y7.71%
FCF growth 5Y11.13%
OCF growth 1Y-6.44%
OCF growth 3Y6.41%
OCF growth 5Y8.83%