Overall CODI gets a fundamental rating of 3 out of 10. We evaluated CODI against 97 industry peers in the Financial Services industry. CODI may be in some trouble as it scores bad on both profitability and health. CODI is valued expensive and it does not seem to be growing.

Quickly go to:

1. Profitability

2. Health

3. Growth

4. Valuation

5. Dividend

1. Profitability

1.1 Basic Checks

CODI had negative earnings in the past year.
CODI had a negative operating cash flow in the past year.
The reported net income has been mixed in the past 5 years: CODI reported negative net income in multiple years.
The reported operating cash flow has been mixed in the past 5 years: CODI reported negative operating cash flow in multiple years.

1.2 Ratios

CODI has a worse Return On Assets (-3.12%) than 83.51% of its industry peers.
With a Return On Equity value of -9.75%, CODI is not doing good in the industry: 79.38% of the companies in the same industry are doing better.
CODI has a Return On Invested Capital of 6.33%. This is in the better half of the industry: CODI outperforms 70.10% of its industry peers.
CODI had an Average Return On Invested Capital over the past 3 years of 4.59%. This is below the industry average of 8.46%.
The last Return On Invested Capital (6.33%) for CODI is above the 3 year average (4.59%), which is a sign of increasing profitability.

		Industry Rank	Sector Rank
ROA	-3.12%
ROE	-9.75%
ROIC	6.33%

ROA(3y)1.22%

ROA(5y)0.97%

ROE(3y)3.42%

ROE(5y)2.78%

ROIC(3y)4.59%

ROIC(5y)4.28%

1.3 Margins

Looking at the Operating Margin, with a value of 10.80%, CODI is in line with its industry, outperforming 43.30% of the companies in the same industry.
CODI's Operating Margin has improved in the last couple of years.
Looking at the Gross Margin, with a value of 45.63%, CODI is in the better half of the industry, outperforming 65.98% of the companies in the same industry.
CODI's Gross Margin has improved in the last couple of years.

		Industry Rank	Sector Rank
OM	10.8%
PM (TTM)	N/A
GM	45.63%

OM growth 3Y8.37%

OM growth 5Y18.91%

PM growth 3YN/A

PM growth 5YN/A

GM growth 3Y4.66%

GM growth 5Y4.7%

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ROA

ROE

ROIC

Operating and Profit Margin

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2. Health

2.1 Basic Checks

CODI has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
The number of shares outstanding for CODI remains at a similar level compared to 1 year ago.
CODI has more shares outstanding than it did 5 years ago.
The debt/assets ratio for CODI is higher compared to a year ago.

2.2 Solvency

Based on the Altman-Z score of 1.23, we must say that CODI is in the distress zone and has some risk of bankruptcy.
Looking at the Altman-Z score, with a value of 1.23, CODI is in the better half of the industry, outperforming 62.89% of the companies in the same industry.
CODI has a Debt/Equity ratio of 1.36. This is a high value indicating a heavy dependency on external financing.
Looking at the Debt to Equity ratio, with a value of 1.36, CODI is doing worse than 61.86% of the companies in the same industry.

		Industry Rank	Sector Rank
Debt/Equity	1.36
Debt/FCF	N/A
Altman-Z	1.23

ROIC/WACC0.89

WACC7.15%

2.3 Liquidity

A Current Ratio of 4.07 indicates that CODI has no problem at all paying its short term obligations.
CODI has a better Current ratio (4.07) than 88.66% of its industry peers.
CODI has a Quick Ratio of 1.57. This is a normal value and indicates that CODI is financially healthy and should not expect problems in meeting its short term obligations.
CODI has a Quick ratio of 1.57. This is in the better half of the industry: CODI outperforms 74.23% of its industry peers.

		Industry Rank	Sector Rank
Current Ratio	4.07
Quick Ratio	1.57

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WACC

Debt/Equity

How to determine the health of a company

Altman-Z score

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3. Growth

3.1 Past

CODI shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -109.34%.
The Earnings Per Share has been growing slightly by 6.59% on average over the past years.
The Revenue has grown by 11.87% in the past year. This is quite good.
CODI shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 11.72% yearly.

EPS 1Y (TTM)-109.34%

EPS 3Y-4.24%

EPS 5Y6.59%

EPS Q2Q%-209.37%

Revenue 1Y (TTM)11.87%

Revenue growth 3Y4.39%

Revenue growth 5Y11.72%

Sales Q2Q%-18.89%

3.2 Future

CODI is expected to show a very negative growth in Earnings Per Share. In the coming years, the EPS will decrease by -55.84% yearly.
The Revenue is expected to decrease by -8.70% on average over the next years.

EPS Next Y-130%

EPS Next 2Y-55.84%

EPS Next 3YN/A

EPS Next 5YN/A

Revenue Next Year-16.72%

Revenue Next 2Y-8.7%

Revenue Next 3YN/A

Revenue Next 5YN/A

3.3 Evolution

When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.

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4. Valuation

4.1 Price/Earnings Ratio

The Price/Earnings Ratio is negative for CODI. In the last year negative earnings were reported.
Also next year CODI is expected to report negative earnings again, which makes the also the Forward Price/Earnings Ratio negative.

		Industry Rank	Sector Rank
PE	N/A
Fwd PE	N/A

4.2 Price Multiples

CODI's Enterprise Value to EBITDA ratio is rather cheap when compared to the industry. CODI is cheaper than 90.72% of the companies in the same industry.

		Industry Rank	Sector Rank
P/FCF	N/A
EV/EBITDA	4.98

4.3 Compensation for Growth

A cheap valuation may be justified as CODI's earnings are expected to decrease with -55.84% in the coming years.

PEG (NY)N/A

PEG (5Y)N/A

EPS Next 2Y-55.84%

EPS Next 3YN/A

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5. Dividend

5.1 Amount

CODI has a Yearly Dividend Yield of 10.11%, which is a nice return.
The stock price of CODI dropped by -23.75% in the last 3 months. With lower prices the dividend yield is higher, but it may be a sign investors do not trust the long term dividend.
Compared to an average industry Dividend Yield of 2.09, CODI pays a better dividend. On top of this CODI pays more dividend than 96.91% of the companies listed in the same industry.
CODI's Dividend Yield is rather good when compared to the S&P500 average which is at 1.81.

		Industry Rank	Sector Rank
Dividend Yield	10.11%

5.2 History

The dividend of CODI decreases each year by -13.06%.
CODI has paid a dividend for at least 10 years, which is a reliable track record.
The dividend of CODI decreased in the last 3 years.

Dividend Growth(5Y)-13.06%

Div Incr Years0

Div Non Decr Years2

5.3 Sustainability

The earnings of CODI are negative and hence is the payout ratio. CODI will probably not be able to sustain this dividend level.
CODI's earnings and Dividend Rate are declining. This means the current dividend is most likely not sustainable.

DP-79.81%

EPS Next 2Y-55.84%

EPS Next 3YN/A

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COMPASS DIVERSIFIED HOLDINGS / CODI FAQ

What is the fundamental rating for CODI stock?

ChartMill assigns a fundamental rating of 4 / 10 to CODI.

Can you provide the valuation status for COMPASS DIVERSIFIED HOLDINGS?

ChartMill assigns a valuation rating of 3 / 10 to COMPASS DIVERSIFIED HOLDINGS (CODI). This can be considered as Overvalued.

How profitable is COMPASS DIVERSIFIED HOLDINGS (CODI) stock?

COMPASS DIVERSIFIED HOLDINGS (CODI) has a profitability rating of 4 / 10.

How sustainable is the dividend of COMPASS DIVERSIFIED HOLDINGS (CODI) stock?

The dividend rating of COMPASS DIVERSIFIED HOLDINGS (CODI) is 5 / 10 and the dividend payout ratio is -79.81%.