We assign a fundamental rating of 3 out of 10 to HZO. HZO was compared to 122 industry peers in the Specialty Retail industry. Both the profitability and financial health of HZO have multiple concerns. While showing a medium growth rate, HZO is valued expensive at the moment.

Quickly go to:

1. Profitability

2. Health

3. Growth

4. Valuation

5. Dividend

1. Profitability

1.1 Basic Checks

HZO had positive earnings in the past year.
In the past year HZO had a positive cash flow from operations.
HZO had positive earnings in 4 of the past 5 years.
In multiple years HZO reported negative operating cash flow during the last 5 years.

1.2 Ratios

With a Return On Assets value of -1.28%, HZO perfoms like the industry average, outperforming 42.15% of the companies in the same industry.
With a Return On Equity value of -3.38%, HZO perfoms like the industry average, outperforming 49.59% of the companies in the same industry.
Looking at the Return On Invested Capital, with a value of 3.34%, HZO is in line with its industry, outperforming 50.41% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for HZO is significantly below the industry average of 12.24%.

		Industry Rank	Sector Rank
ROA	-1.28%
ROE	-3.38%
ROIC	3.34%

ROA(3y)1.56%

ROA(5y)6.94%

ROE(3y)4.15%

ROE(5y)12.76%

ROIC(3y)4.73%

ROIC(5y)10.19%

1.3 Margins

The Operating Margin of HZO (4.46%) is better than 62.81% of its industry peers.
In the last couple of years the Operating Margin of HZO has declined.
Looking at the Gross Margin, with a value of 32.49%, HZO is doing worse than 61.16% of the companies in the same industry.
HZO's Gross Margin has improved in the last couple of years.

		Industry Rank	Sector Rank
OM	4.46%
PM (TTM)	N/A
GM	32.49%

OM growth 3Y-27.03%

OM growth 5Y-9.07%

PM growth 3YN/A

PM growth 5YN/A

GM growth 3Y-2.37%

GM growth 5Y4.23%

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ROA

ROE

ROIC

Operating and Profit Margin

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2. Health

2.1 Basic Checks

HZO has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
Compared to 1 year ago, HZO has less shares outstanding
Compared to 5 years ago, HZO has about the same amount of shares outstanding.
The debt/assets ratio for HZO is higher compared to a year ago.

2.2 Solvency

An Altman-Z score of 1.83 indicates that HZO is not a great score, but indicates only limited risk for bankruptcy at the moment.
HZO has a Altman-Z score (1.83) which is comparable to the rest of the industry.
HZO has a debt to FCF ratio of 92.74. This is a negative value and a sign of low solvency as HZO would need 92.74 years to pay back of all of its debts.
HZO has a Debt to FCF ratio (92.74) which is in line with its industry peers.
A Debt/Equity ratio of 1.14 is on the high side and indicates that HZO has dependencies on debt financing.
HZO has a Debt to Equity ratio of 1.14. This is comparable to the rest of the industry: HZO outperforms 41.32% of its industry peers.

		Industry Rank	Sector Rank
Debt/Equity	1.14
Debt/FCF	92.74
Altman-Z	1.83

ROIC/WACC0.38

WACC8.89%

2.3 Liquidity

A Current Ratio of 1.20 indicates that HZO should not have too much problems paying its short term obligations.
HZO's Current ratio of 1.20 is in line compared to the rest of the industry. HZO outperforms 40.50% of its industry peers.
HZO has a Quick Ratio of 1.20. This is a bad value and indicates that HZO is not financially healthy enough and could expect problems in meeting its short term obligations.
With a Quick ratio value of 0.32, HZO is not doing good in the industry: 68.59% of the companies in the same industry are doing better.

		Industry Rank	Sector Rank
Current Ratio	1.2
Quick Ratio	0.32

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WACC

Debt/Equity

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Altman-Z score

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3. Growth

3.1 Past

The earnings per share for HZO have decreased strongly by -59.91% in the last year.
Measured over the past years, HZO shows a very negative growth in Earnings Per Share. The EPS has been decreasing by -24.26% on average per year.
Looking at the last year, HZO shows a decrease in Revenue. The Revenue has decreased by -5.01% in the last year.
HZO shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 8.87% yearly.

EPS 1Y (TTM)-59.91%

EPS 3Y-54.22%

EPS 5Y-24.26%

EPS Q2Q%-116.67%

Revenue 1Y (TTM)-5.01%

Revenue growth 3Y0.02%

Revenue growth 5Y8.87%

Sales Q2Q%-1.95%

3.2 Future

Based on estimates for the next years, HZO will show a very strong growth in Earnings Per Share. The EPS will grow by 50.07% on average per year.
HZO is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 3.37% yearly.

EPS Next Y5.9%

EPS Next 2Y39.26%

EPS Next 3Y50.07%

EPS Next 5YN/A

Revenue Next Year1.95%

Revenue Next 2Y2.98%

Revenue Next 3Y3.37%

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.

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4. Valuation

4.1 Price/Earnings Ratio

A Price/Earnings ratio of 33.14 indicates a quite expensive valuation of HZO.
HZO's Price/Earnings ratio is a bit cheaper when compared to the industry. HZO is cheaper than 61.16% of the companies in the same industry.
The average S&P500 Price/Earnings ratio is at 27.21. HZO is valued slightly more expensive when compared to this.
With a Price/Forward Earnings ratio of 31.29, HZO can be considered very expensive at the moment.
HZO's Price/Forward Earnings is on the same level as the industry average.
HZO's Price/Forward Earnings ratio indicates a valuation a bit more expensive than the S&P500 average which is at 25.98.

		Industry Rank	Sector Rank
PE	33.14
Fwd PE	31.29

4.2 Price Multiples

87.60% of the companies in the same industry are more expensive than HZO, based on the Enterprise Value to EBITDA ratio.
The rest of the industry has a similar Price/Free Cash Flow ratio as HZO.

		Industry Rank	Sector Rank
P/FCF	51.59
EV/EBITDA	5.5

4.3 Compensation for Growth

The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates HZO does not grow enough to justify the current Price/Earnings ratio.
A more expensive valuation may be justified as HZO's earnings are expected to grow with 50.07% in the coming years.