DELUXE CORP (DLX) Stock Fundamental Analysis
NYSE:DLX - New York Stock Exchange, Inc. - US2480191012 - Common Stock - Currency: USD
We assign a fundamental rating of 4 out of 10 to DLX. DLX was compared to 83 industry peers in the Commercial Services & Supplies industry. DLX has a medium profitability rating, but doesn't score so well on its financial health evaluation. DLX is valued quite cheap, but it does not seem to be growing. DLX also has an excellent dividend rating.
1. Profitability
1.1 Basic Checks
In the past year DLX was profitable.
DLX had a positive operating cash flow in the past year.
DLX had positive earnings in each of the past 5 years.
Each year in the past 5 years DLX had a positive operating cash flow.
1.2 Ratios
DLX has a Return On Assets (1.86%) which is in line with its industry peers.
DLX has a better Return On Equity (8.50%) than 67.86% of its industry peers.
Looking at the Return On Invested Capital, with a value of 6.66%, DLX is in line with its industry, outperforming 58.33% of the companies in the same industry.
DLX had an Average Return On Invested Capital over the past 3 years of 6.34%. This is below the industry average of 10.88%.
The last Return On Invested Capital (6.66%) for DLX is above the 3 year average (6.34%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.86% | ||
| ROE | 8.5% | ||
| ROIC | 6.66% |
ROA(3y)1.61%
ROA(5y)1.47%
ROE(3y)7.88%
ROE(5y)7.23%
ROIC(3y)6.34%
ROIC(5y)7.11%
1.3 Margins
Looking at the Profit Margin, with a value of 2.49%, DLX is in line with its industry, outperforming 57.14% of the companies in the same industry.
In the last couple of years the Profit Margin of DLX has declined.
DLX has a Operating Margin of 10.24%. This is in the better half of the industry: DLX outperforms 72.62% of its industry peers.
In the last couple of years the Operating Margin of DLX has declined.
Looking at the Gross Margin, with a value of 53.09%, DLX belongs to the top of the industry, outperforming 92.86% of the companies in the same industry.
In the last couple of years the Gross Margin of DLX has declined.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 10.24% | ||
| PM (TTM) | 2.49% | ||
| GM | 53.09% |
OM growth 3Y-1.37%
OM growth 5Y-8.08%
PM growth 3Y-7.02%
PM growth 5YN/A
GM growth 3Y-1.92%
GM growth 5Y-2.26%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so DLX is destroying value.
The number of shares outstanding for DLX has been increased compared to 1 year ago.
Compared to 5 years ago, DLX has more shares outstanding
The debt/assets ratio for DLX is higher compared to a year ago.
2.2 Solvency
DLX has an Altman-Z score of 1.44. This is a bad value and indicates that DLX is not financially healthy and even has some risk of bankruptcy.
DLX has a worse Altman-Z score (1.44) than 65.48% of its industry peers.
The Debt to FCF ratio of DLX is 15.05, which is on the high side as it means it would take DLX, 15.05 years of fcf income to pay off all of its debts.
DLX has a Debt to FCF ratio (15.05) which is comparable to the rest of the industry.
DLX has a Debt/Equity ratio of 2.36. This is a high value indicating a heavy dependency on external financing.
With a Debt to Equity ratio value of 2.36, DLX is not doing good in the industry: 82.14% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.36 | ||
| Debt/FCF | 15.05 | ||
| Altman-Z | 1.44 |
ROIC/WACC0.87
WACC7.69%
2.3 Liquidity
DLX has a Current Ratio of 0.98. This is a bad value and indicates that DLX is not financially healthy enough and could expect problems in meeting its short term obligations.
DLX's Current ratio of 0.98 is on the low side compared to the rest of the industry. DLX is outperformed by 77.38% of its industry peers.
DLX has a Quick Ratio of 0.98. This is a bad value and indicates that DLX is not financially healthy enough and could expect problems in meeting its short term obligations.
DLX has a Quick ratio of 0.92. This is in the lower half of the industry: DLX underperforms 73.81% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.98 | ||
| Quick Ratio | 0.92 |
3. Growth
3.1 Past
DLX shows a slight negative growth in Earnings Per Share. In the last year, the EPS has decreased by -0.60%.
Measured over the past years, DLX shows a very negative growth in Earnings Per Share. The EPS has been decreasing by -13.54% on average per year.
Looking at the last year, DLX shows a decrease in Revenue. The Revenue has decreased by -3.22% in the last year.
Measured over the past years, DLX shows a small growth in Revenue. The Revenue has been growing by 1.10% on average per year.
EPS 1Y (TTM)-0.6%
EPS 3Y-12.17%
EPS 5Y-13.54%
EPS Q2Q%5%
Revenue 1Y (TTM)-3.22%
Revenue growth 3Y1.61%
Revenue growth 5Y1.1%
Sales Q2Q%-3.14%
3.2 Future
Based on estimates for the next years, DLX will show a small growth in Earnings Per Share. The EPS will grow by 5.19% on average per year.
Based on estimates for the next years, DLX will show a small growth in Revenue. The Revenue will grow by 0.21% on average per year.
EPS Next Y1.46%
EPS Next 2Y5.19%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue Next Year-0.7%
Revenue Next 2Y0.21%
Revenue Next 3YN/A
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
Based on the Price/Earnings ratio of 4.96, the valuation of DLX can be described as very cheap.
Compared to the rest of the industry, the Price/Earnings ratio of DLX indicates a rather cheap valuation: DLX is cheaper than 95.24% of the companies listed in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 29.35, DLX is valued rather cheaply.
With a Price/Forward Earnings ratio of 4.89, the valuation of DLX can be described as very cheap.
Compared to the rest of the industry, the Price/Forward Earnings ratio of DLX indicates a rather cheap valuation: DLX is cheaper than 97.62% of the companies listed in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 22.10, DLX is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 4.96 | ||
| Fwd PE | 4.89 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, DLX is valued cheaper than 88.10% of the companies in the same industry.
86.90% of the companies in the same industry are more expensive than DLX, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 7.28 | ||
| EV/EBITDA | 5.74 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates DLX does not grow enough to justify the current Price/Earnings ratio.
PEG (NY)3.4
PEG (5Y)N/A
EPS Next 2Y5.19%
EPS Next 3YN/A
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 7.51%, DLX is a good candidate for dividend investing.
The stock price of DLX dropped by -29.76% 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 2.36, DLX pays a better dividend. On top of this DLX pays more dividend than 100.00% of the companies listed in the same industry.
DLX's Dividend Yield is rather good when compared to the S&P500 average which is at 2.33.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 7.51% |
5.2 History
The dividend of DLX has a limited annual growth rate of 0.62%.
DLX has been paying a dividend for at least 10 years, so it has a reliable track record.
DLX has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)0.62%
Div Incr Years0
Div Non Decr Years17
5.3 Sustainability
DLX pays out 102.60% of its income as dividend. This is not a sustainable payout ratio.
The dividend of DLX is growing, but earnings are growing more, so the dividend growth is sustainable.
DP102.6%
EPS Next 2Y5.19%
EPS Next 3YN/A
16.36
+0.39 (+2.44%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCommercial & Professional Services
GICS IndustryCommercial Services & Supplies
Earnings (Last)
Earnings (Next)
Inst Owners88.91%
Inst Owner Change26.49%
Ins Owners1.33%
Ins Owner Change11.01%
Market Cap726.87M
Analysts80
Price Target29.58 (80.81%)
Short Float %6.12%
Short Ratio7.54
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 7.51% |
Yearly Dividend1.23
Dividend Growth(5Y)0.62%
DP102.6%
Div Incr Years0
Div Non Decr Years17
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)6.15%
Min EPS beat(2)-0.1%
Max EPS beat(2)12.39%
EPS beat(4)3
Avg EPS beat(4)8.62%
Min EPS beat(4)-0.1%
Max EPS beat(4)15.85%
EPS beat(8)7
Avg EPS beat(8)12.37%
EPS beat(12)9
Avg EPS beat(12)8.46%
EPS beat(16)13
Avg EPS beat(16)8.86%
Revenue beat(2)0
Avg Revenue beat(2)-1.82%
Min Revenue beat(2)-3.14%
Max Revenue beat(2)-0.5%
Revenue beat(4)1
Avg Revenue beat(4)-1%
Min Revenue beat(4)-3.14%
Max Revenue beat(4)0.64%
Revenue beat(8)3
Avg Revenue beat(8)-0.21%
Revenue beat(12)7
Avg Revenue beat(12)0.9%
Revenue beat(16)10
Avg Revenue beat(16)1.73%
PT rev (1m)3.85%
PT rev (3m)3.85%
EPS NQ rev (1m)-7.79%
EPS NQ rev (3m)-7.79%
EPS NY rev (1m)-2.36%
EPS NY rev (3m)-2.36%
Revenue NQ rev (1m)-0.88%
Revenue NQ rev (3m)-0.88%
Revenue NY rev (1m)-2.46%
Revenue NY rev (3m)-2.46%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 4.96 | ||
| Fwd PE | 4.89 | ||
| P/S | 0.34 | ||
| P/FCF | 7.28 | ||
| P/OCF | 3.74 | ||
| P/B | 1.17 | ||
| P/tB | N/A | ||
| EV/EBITDA | 5.74 |
EPS(TTM)3.3
EY20.17%
EPS(NY)3.35
Fwd EY20.47%
FCF(TTM)2.25
FCFY13.74%
OCF(TTM)4.37
OCFY26.73%
SpS47.76
BVpS13.97
TBVpS-25.5
PEG (NY)3.4
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.86% | ||
| ROE | 8.5% | ||
| ROCE | 9.85% | ||
| ROIC | 6.66% | ||
| ROICexc | 6.76% | ||
| ROICexgc | 35.17% | ||
| OM | 10.24% | ||
| PM (TTM) | 2.49% | ||
| GM | 53.09% | ||
| FCFM | 4.71% |
ROA(3y)1.61%
ROA(5y)1.47%
ROE(3y)7.88%
ROE(5y)7.23%
ROIC(3y)6.34%
ROIC(5y)7.11%
ROICexc(3y)6.48%
ROICexc(5y)7.41%
ROICexgc(3y)36.57%
ROICexgc(5y)37.66%
ROCE(3y)9.38%
ROCE(5y)10.53%
ROICexcg growth 3Y-0.45%
ROICexcg growth 5Y-8.74%
ROICexc growth 3Y2.9%
ROICexc growth 5Y-14.14%
OM growth 3Y-1.37%
OM growth 5Y-8.08%
PM growth 3Y-7.02%
PM growth 5YN/A
GM growth 3Y-1.92%
GM growth 5Y-2.26%
F-Score7
Asset Turnover0.75
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.36 | ||
| Debt/FCF | 15.05 | ||
| Debt/EBITDA | 3.83 | ||
| Cap/Depr | 57.02% | ||
| Cap/Sales | 4.45% | ||
| Interest Coverage | 1.84 | ||
| Cash Conversion | 50.75% | ||
| Profit Quality | 189.25% | ||
| Current Ratio | 0.98 | ||
| Quick Ratio | 0.92 | ||
| Altman-Z | 1.44 |
F-Score7
WACC7.69%
ROIC/WACC0.87
Cap/Depr(3y)59.84%
Cap/Depr(5y)64.25%
Cap/Sales(3y)4.64%
Cap/Sales(5y)4.71%
Profit Quality(3y)229.97%
Profit Quality(5y)496.64%
High Growth Momentum
Growth
EPS 1Y (TTM)-0.6%
EPS 3Y-12.17%
EPS 5Y-13.54%
EPS Q2Q%5%
EPS Next Y1.46%
EPS Next 2Y5.19%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue 1Y (TTM)-3.22%
Revenue growth 3Y1.61%
Revenue growth 5Y1.1%
Sales Q2Q%-3.14%
Revenue Next Year-0.7%
Revenue Next 2Y0.21%
Revenue Next 3YN/A
Revenue Next 5YN/A
EBIT growth 1Y5.16%
EBIT growth 3Y0.23%
EBIT growth 5Y-7.07%
EBIT Next Year124.13%
EBIT Next 3YN/A
EBIT Next 5YN/A
FCF growth 1Y2.33%
FCF growth 3Y0.33%
FCF growth 5Y-14.61%
OCF growth 1Y-2.06%
OCF growth 3Y-2.69%
OCF growth 5Y-7.49%