MONRO INC (MNRO) Stock Fundamental Analysis
NASDAQ:MNRO - Nasdaq - US6102361010 - Common Stock - Currency: USD
We assign a fundamental rating of 3 out of 10 to MNRO. MNRO was compared to 120 industry peers in the Specialty Retail industry. While MNRO is still in line with the averages on profitability rating, there are concerns on its financial health. MNRO is valued correctly, but it does not seem to be growing. Finally MNRO also has an excellent dividend rating.
1. Profitability
1.1 Basic Checks
MNRO had positive earnings in the past year.
MNRO had a positive operating cash flow in the past year.
Each year in the past 5 years MNRO has been profitable.
In the past 5 years MNRO always reported a positive cash flow from operatings.
1.2 Ratios
The Return On Assets of MNRO (1.10%) is comparable to the rest of the industry.
MNRO has a Return On Equity (2.84%) which is comparable to the rest of the industry.
The Return On Invested Capital of MNRO (2.83%) is comparable to the rest of the industry.
MNRO had an Average Return On Invested Capital over the past 3 years of 4.31%. This is significantly below the industry average of 12.30%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.1% | ||
| ROE | 2.84% | ||
| ROIC | 2.83% |
ROA(3y)2.53%
ROA(5y)2.45%
ROE(3y)6.3%
ROE(5y)6.25%
ROIC(3y)4.31%
ROIC(5y)4.06%
1.3 Margins
MNRO has a Profit Margin (1.52%) which is comparable to the rest of the industry.
In the last couple of years the Profit Margin of MNRO has declined.
Looking at the Operating Margin, with a value of 3.86%, MNRO is in line with its industry, outperforming 58.12% of the companies in the same industry.
In the last couple of years the Operating Margin of MNRO has declined.
The Gross Margin of MNRO (35.56%) is comparable to the rest of the industry.
In the last couple of years the Gross Margin of MNRO has declined.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 3.86% | ||
| PM (TTM) | 1.52% | ||
| GM | 35.56% |
OM growth 3Y-4.59%
OM growth 5Y-12.01%
PM growth 3Y-1.78%
PM growth 5Y-15.46%
GM growth 3Y0.29%
GM growth 5Y-1.79%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), MNRO is destroying value.
The number of shares outstanding for MNRO has been reduced compared to 1 year ago.
The number of shares outstanding for MNRO has been reduced compared to 5 years ago.
Compared to 1 year ago, MNRO has an improved debt to assets ratio.
2.2 Solvency
Based on the Altman-Z score of 1.53, we must say that MNRO is in the distress zone and has some risk of bankruptcy.
With a Altman-Z score value of 1.53, MNRO is not doing good in the industry: 70.09% of the companies in the same industry are doing better.
The Debt to FCF ratio of MNRO is 4.69, which is a neutral value as it means it would take MNRO, 4.69 years of fcf income to pay off all of its debts.
MNRO has a Debt to FCF ratio of 4.69. This is in the better half of the industry: MNRO outperforms 64.10% of its industry peers.
A Debt/Equity ratio of 0.45 indicates that MNRO is not too dependend on debt financing.
Looking at the Debt to Equity ratio, with a value of 0.45, MNRO is in line with its industry, outperforming 49.57% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.45 | ||
| Debt/FCF | 4.69 | ||
| Altman-Z | 1.53 |
ROIC/WACC0.31
WACC9.08%
2.3 Liquidity
A Current Ratio of 0.54 indicates that MNRO may have some problems paying its short term obligations.
MNRO's Current ratio of 0.54 is on the low side compared to the rest of the industry. MNRO is outperformed by 94.87% of its industry peers.
MNRO has a Quick Ratio of 0.54. This is a bad value and indicates that MNRO is not financially healthy enough and could expect problems in meeting its short term obligations.
The Quick ratio of MNRO (0.19) is worse than 88.89% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.54 | ||
| Quick Ratio | 0.19 |
3. Growth
3.1 Past
MNRO shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -33.61%.
MNRO shows a very negative growth in Earnings Per Share. Measured over the last years, the EPS has been decreasing by -11.20% yearly.
Looking at the last year, MNRO shows a decrease in Revenue. The Revenue has decreased by -5.25% in the last year.
MNRO shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 1.24% yearly.
EPS 1Y (TTM)-33.61%
EPS 3Y5.01%
EPS 5Y-11.2%
EPS Q2Q%-51.28%
Revenue 1Y (TTM)-5.25%
Revenue growth 3Y4.29%
Revenue growth 5Y1.24%
Sales Q2Q%-3.74%
3.2 Future
Based on estimates for the next years, MNRO will show a very negative growth in Earnings Per Share. The EPS will decrease by -14.70% on average per year.
The Revenue is expected to decrease by -1.52% on average over the next years.
EPS Next Y-53.64%
EPS Next 2Y-21.46%
EPS Next 3Y-14.7%
EPS Next 5YN/A
Revenue Next Year-7.62%
Revenue Next 2Y-2.62%
Revenue Next 3Y-1.52%
Revenue Next 5YN/A
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 23.68 indicates a rather expensive valuation of MNRO.
MNRO's Price/Earnings ratio is a bit cheaper when compared to the industry. MNRO is cheaper than 60.68% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 29.63, MNRO is valued a bit cheaper.
A Price/Forward Earnings ratio of 22.98 indicates a rather expensive valuation of MNRO.
MNRO's Price/Forward Earnings is on the same level as the industry average.
MNRO is valuated at similar levels of the S&P average when we compare the Price/Forward Earnings ratio to 22.68, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 23.68 | ||
| Fwd PE | 22.98 |
4.2 Price Multiples
MNRO's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. MNRO is cheaper than 71.79% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, MNRO is valued cheaper than 89.74% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 7.95 | ||
| EV/EBITDA | 7.66 |
4.3 Compensation for Growth
MNRO's earnings are expected to decrease with -14.70% in the coming years. This may justify a cheaper valuation.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y-21.46%
EPS Next 3Y-14.7%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 5.83%, MNRO is a good candidate for dividend investing.
The stock price of MNRO dropped by -30.81% 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.
MNRO's Dividend Yield is rather good when compared to the industry average which is at 4.31. MNRO pays more dividend than 94.87% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 2.27, MNRO pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 5.83% |
5.2 History
On average, the dividend of MNRO grows each year by 7.36%, which is quite nice.
MNRO has paid a dividend for at least 10 years, which is a reliable track record.
MNRO has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)7.36%
Div Incr Years10
Div Non Decr Years10
5.3 Sustainability
187.21% of the earnings are spent on dividend by MNRO. This is not a sustainable payout ratio.
The Dividend Rate of MNRO has been growing, while earnings will be declining. This means the dividend growth is most likely not sustainable.
DP187.21%
EPS Next 2Y-21.46%
EPS Next 3Y-14.7%
18.71
-0.5 (-2.6%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Discretionary Distribution & Retail
GICS IndustrySpecialty Retail
Earnings (Last)
Earnings (Next)
Inst Owners110.4%
Inst Owner Change1.57%
Ins Owners0.84%
Ins Owner Change0%
Market Cap560.36M
Analysts75
Price Target22.95 (22.66%)
Short Float %10.29%
Short Ratio4.49
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 5.83% |
Yearly Dividend1.16
Dividend Growth(5Y)7.36%
DP187.21%
Div Incr Years10
Div Non Decr Years10
Ex-Date
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-36.15%
Min EPS beat(2)-36.5%
Max EPS beat(2)-35.8%
EPS beat(4)1
Avg EPS beat(4)847.51%
Min EPS beat(4)-36.5%
Max EPS beat(4)3494.77%
EPS beat(8)2
Avg EPS beat(8)411.85%
EPS beat(12)3
Avg EPS beat(12)271.27%
EPS beat(16)6
Avg EPS beat(16)205.63%
Revenue beat(2)0
Avg Revenue beat(2)-2.58%
Min Revenue beat(2)-3.64%
Max Revenue beat(2)-1.53%
Revenue beat(4)0
Avg Revenue beat(4)-3.08%
Min Revenue beat(4)-5.07%
Max Revenue beat(4)-1.53%
Revenue beat(8)0
Avg Revenue beat(8)-3.41%
Revenue beat(12)0
Avg Revenue beat(12)-2.97%
Revenue beat(16)3
Avg Revenue beat(16)-2.09%
PT rev (1m)-3.36%
PT rev (3m)-1.99%
EPS NQ rev (1m)-86.41%
EPS NQ rev (3m)-91.62%
EPS NY rev (1m)-31.82%
EPS NY rev (3m)-31.82%
Revenue NQ rev (1m)-4.34%
Revenue NQ rev (3m)-8.77%
Revenue NY rev (1m)-1.46%
Revenue NY rev (3m)-1.46%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 23.68 | ||
| Fwd PE | 22.98 | ||
| P/S | 0.46 | ||
| P/FCF | 7.95 | ||
| P/OCF | 5.73 | ||
| P/B | 0.86 | ||
| P/tB | N/A | ||
| EV/EBITDA | 7.66 |
EPS(TTM)0.79
EY4.22%
EPS(NY)0.81
Fwd EY4.35%
FCF(TTM)2.35
FCFY12.57%
OCF(TTM)3.26
OCFY17.44%
SpS40.41
BVpS21.67
TBVpS-3.29
PEG (NY)N/A
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.1% | ||
| ROE | 2.84% | ||
| ROCE | 4.02% | ||
| ROIC | 2.83% | ||
| ROICexc | 2.86% | ||
| ROICexgc | 8.13% | ||
| OM | 3.86% | ||
| PM (TTM) | 1.52% | ||
| GM | 35.56% | ||
| FCFM | 5.82% |
ROA(3y)2.53%
ROA(5y)2.45%
ROE(3y)6.3%
ROE(5y)6.25%
ROIC(3y)4.31%
ROIC(5y)4.06%
ROICexc(3y)4.33%
ROICexc(5y)4.28%
ROICexgc(3y)10.01%
ROICexgc(5y)9.26%
ROCE(3y)6.12%
ROCE(5y)5.78%
ROICexcg growth 3Y16.65%
ROICexcg growth 5Y-11.3%
ROICexc growth 3Y6.07%
ROICexc growth 5Y-13.09%
OM growth 3Y-4.59%
OM growth 5Y-12.01%
PM growth 3Y-1.78%
PM growth 5Y-15.46%
GM growth 3Y0.29%
GM growth 5Y-1.79%
F-Score6
Asset Turnover0.72
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.45 | ||
| Debt/FCF | 4.69 | ||
| Debt/EBITDA | 2.5 | ||
| Cap/Depr | 38.87% | ||
| Cap/Sales | 2.25% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 83.61% | ||
| Profit Quality | 382% | ||
| Current Ratio | 0.54 | ||
| Quick Ratio | 0.19 | ||
| Altman-Z | 1.53 |
F-Score6
WACC9.08%
ROIC/WACC0.31
Cap/Depr(3y)40.06%
Cap/Depr(5y)54.61%
Cap/Sales(3y)2.33%
Cap/Sales(5y)3.2%
Profit Quality(3y)323.27%
Profit Quality(5y)295.26%
High Growth Momentum
Growth
EPS 1Y (TTM)-33.61%
EPS 3Y5.01%
EPS 5Y-11.2%
EPS Q2Q%-51.28%
EPS Next Y-53.64%
EPS Next 2Y-21.46%
EPS Next 3Y-14.7%
EPS Next 5YN/A
Revenue 1Y (TTM)-5.25%
Revenue growth 3Y4.29%
Revenue growth 5Y1.24%
Sales Q2Q%-3.74%
Revenue Next Year-7.62%
Revenue Next 2Y-2.62%
Revenue Next 3Y-1.52%
Revenue Next 5YN/A
EBIT growth 1Y-30.52%
EBIT growth 3Y-0.5%
EBIT growth 5Y-10.91%
EBIT Next Year41.78%
EBIT Next 3Y14.35%
EBIT Next 5YN/A
FCF growth 1Y-60.62%
FCF growth 3Y-9.2%
FCF growth 5Y-1.66%
OCF growth 1Y-55.13%
OCF growth 3Y-12.19%
OCF growth 5Y-3.92%