PARSONS CORP (PSN) Stock Fundamental Analysis
NYSE:PSN - New York Stock Exchange, Inc. - US70202L1026 - Common Stock - Currency: USD
PSN gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 82 industry peers in the Professional Services industry. PSN has only an average score on both its financial health and profitability. PSN has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
PSN had positive earnings in the past year.
In the past year PSN had a positive cash flow from operations.
PSN had positive earnings in 4 of the past 5 years.
PSN had a positive operating cash flow in 4 of the past 5 years.
1.2 Ratios
PSN has a Return On Assets of 1.45%. This is comparable to the rest of the industry: PSN outperforms 43.04% of its industry peers.
Looking at the Return On Equity, with a value of 3.40%, PSN is in line with its industry, outperforming 43.04% of the companies in the same industry.
Looking at the Return On Invested Capital, with a value of 9.43%, PSN is in the better half of the industry, outperforming 63.29% of the companies in the same industry.
PSN had an Average Return On Invested Capital over the past 3 years of 4.85%. This is significantly below the industry average of 13.65%.
The last Return On Invested Capital (9.43%) for PSN is above the 3 year average (4.85%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.45% | ||
| ROE | 3.4% | ||
| ROIC | 9.43% |
ROA(3y)2.44%
ROA(5y)2.66%
ROE(3y)5.05%
ROE(5y)5.59%
ROIC(3y)4.85%
ROIC(5y)4.17%
1.3 Margins
PSN has a Profit Margin (1.21%) which is in line with its industry peers.
PSN's Profit Margin has declined in the last couple of years.
PSN has a better Operating Margin (7.31%) than 60.76% of its industry peers.
PSN's Operating Margin has improved in the last couple of years.
PSN has a worse Gross Margin (21.56%) than 74.68% of its industry peers.
PSN's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 7.31% | ||
| PM (TTM) | 1.21% | ||
| GM | 21.56% |
OM growth 3Y16.46%
OM growth 5Y12.67%
PM growth 3Y5.61%
PM growth 5Y-14.13%
GM growth 3Y-0.33%
GM growth 5Y1.8%
2. Health
2.1 Basic Checks
PSN has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
PSN has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.
2.2 Solvency
An Altman-Z score of 2.95 indicates that PSN is not a great score, but indicates only limited risk for bankruptcy at the moment.
With a Altman-Z score value of 2.95, PSN perfoms like the industry average, outperforming 54.43% of the companies in the same industry.
PSN has a debt to FCF ratio of 2.30. This is a good value and a sign of high solvency as PSN would need 2.30 years to pay back of all of its debts.
PSN's Debt to FCF ratio of 2.30 is fine compared to the rest of the industry. PSN outperforms 67.09% of its industry peers.
PSN has a Debt/Equity ratio of 0.54. This is a neutral value indicating PSN is somewhat dependend on debt financing.
PSN has a Debt to Equity ratio (0.54) which is in line with its industry peers.
Even though the debt/equity ratio score it not favorable for PSN, it has very limited outstanding debt, so we won't put too much weight on the DE evaluation.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.54 | ||
| Debt/FCF | 2.3 | ||
| Altman-Z | 2.95 |
ROIC/WACC1.07
WACC8.81%
2.3 Liquidity
A Current Ratio of 1.55 indicates that PSN should not have too much problems paying its short term obligations.
PSN has a Current ratio (1.55) which is comparable to the rest of the industry.
A Quick Ratio of 1.55 indicates that PSN should not have too much problems paying its short term obligations.
Looking at the Quick ratio, with a value of 1.55, PSN is in line with its industry, outperforming 55.70% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.55 | ||
| Quick Ratio | 1.55 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 34.02% over the past year.
Measured over the past years, PSN shows a quite strong growth in Earnings Per Share. The EPS has been growing by 13.84% on average per year.
EPS 1Y (TTM)34.02%
EPS 3Y32.68%
EPS 5Y13.84%
EPS Q2Q%13.04%
Revenue 1Y (TTM)N/A
Revenue growth 3YN/A
Revenue growth 5YN/A
Sales Q2Q%16.07%
3.2 Future
PSN is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 16.76% yearly.
PSN is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 8.32% yearly.
EPS Next Y20.95%
EPS Next 2Y16.76%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue Next Year8.83%
Revenue Next 2Y8.32%
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.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 18.19, PSN is valued on the expensive side.
Compared to the rest of the industry, the Price/Earnings ratio of PSN is on the same level as its industry peers.
PSN is valuated rather cheaply when we compare the Price/Earnings ratio to 29.63, which is the current average of the S&P500 Index.
PSN is valuated correctly with a Price/Forward Earnings ratio of 15.04.
PSN's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. PSN is cheaper than 65.82% of the companies in the same industry.
PSN is valuated rather cheaply 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 | 18.19 | ||
| Fwd PE | 15.04 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of PSN indicates a somewhat cheap valuation: PSN is cheaper than 63.29% of the companies listed in the same industry.
Based on the Price/Free Cash Flow ratio, PSN is valued cheaper than 86.08% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 11.55 | ||
| EV/EBITDA | 11.85 |
4.3 Compensation for Growth
The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
A more expensive valuation may be justified as PSN's earnings are expected to grow with 16.76% in the coming years.
PEG (NY)0.87
PEG (5Y)1.31
EPS Next 2Y16.76%
EPS Next 3YN/A
5. Dividend
5.1 Amount
PSN does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
59.49
-2.46 (-3.97%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCommercial & Professional Services
GICS IndustryProfessional Services
Earnings (Last)
Earnings (Next)
Inst Owners101.49%
Inst Owner Change-1.29%
Ins Owners0.87%
Ins Owner Change-0.73%
Market Cap6.32B
Analysts81.33
Price Target117.09 (96.82%)
Short Float %4.39%
Short Ratio4.14
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Yearly Dividend0
Dividend Growth(5Y)N/A
DP0%
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)18.63%
Min EPS beat(2)17.43%
Max EPS beat(2)19.84%
EPS beat(4)4
Avg EPS beat(4)14.38%
Min EPS beat(4)8.82%
Max EPS beat(4)19.84%
EPS beat(8)6
Avg EPS beat(8)10.57%
EPS beat(12)8
Avg EPS beat(12)7.01%
EPS beat(16)8
Avg EPS beat(16)-2.59%
Revenue beat(2)2
Avg Revenue beat(2)8.33%
Min Revenue beat(2)7.15%
Max Revenue beat(2)9.5%
Revenue beat(4)4
Avg Revenue beat(4)9.74%
Min Revenue beat(4)7.15%
Max Revenue beat(4)11.84%
Revenue beat(8)8
Avg Revenue beat(8)10.1%
Revenue beat(12)11
Avg Revenue beat(12)8.48%
Revenue beat(16)11
Avg Revenue beat(16)4.81%
PT rev (1m)-5.69%
PT rev (3m)-6.61%
EPS NQ rev (1m)0.55%
EPS NQ rev (3m)0.55%
EPS NY rev (1m)0.18%
EPS NY rev (3m)0.8%
Revenue NQ rev (1m)0.11%
Revenue NQ rev (3m)0.11%
Revenue NY rev (1m)0%
Revenue NY rev (3m)0.41%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 18.19 | ||
| Fwd PE | 15.04 | ||
| P/S | 0.97 | ||
| P/FCF | 11.55 | ||
| P/OCF | 10.76 | ||
| P/B | 2.73 | ||
| P/tB | 86.13 | ||
| EV/EBITDA | 11.85 |
EPS(TTM)3.27
EY5.5%
EPS(NY)3.96
Fwd EY6.65%
FCF(TTM)5.15
FCFY8.66%
OCF(TTM)5.53
OCFY9.29%
SpS61.31
BVpS21.78
TBVpS0.69
PEG (NY)0.87
PEG (5Y)1.31
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.45% | ||
| ROE | 3.4% | ||
| ROCE | 12.55% | ||
| ROIC | 9.43% | ||
| ROICexc | 11% | ||
| ROICexgc | 33.16% | ||
| OM | 7.31% | ||
| PM (TTM) | 1.21% | ||
| GM | 21.56% | ||
| FCFM | 8.4% |
ROA(3y)2.44%
ROA(5y)2.66%
ROE(3y)5.05%
ROE(5y)5.59%
ROIC(3y)4.85%
ROIC(5y)4.17%
ROICexc(3y)5.33%
ROICexc(5y)4.66%
ROICexgc(3y)15.99%
ROICexgc(5y)13.68%
ROCE(3y)6.27%
ROCE(5y)5.4%
ROICexcg growth 3Y19.03%
ROICexcg growth 5Y1.89%
ROICexc growth 3Y17.66%
ROICexc growth 5Y3.69%
OM growth 3Y16.46%
OM growth 5Y12.67%
PM growth 3Y5.61%
PM growth 5Y-14.13%
GM growth 3Y-0.33%
GM growth 5Y1.8%
F-Score7
Asset Turnover1.2
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.54 | ||
| Debt/FCF | 2.3 | ||
| Debt/EBITDA | 2.15 | ||
| Cap/Depr | 37.58% | ||
| Cap/Sales | 0.61% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 100.8% | ||
| Profit Quality | 695.25% | ||
| Current Ratio | 1.55 | ||
| Quick Ratio | 1.55 | ||
| Altman-Z | 2.95 |
F-Score7
WACC8.81%
ROIC/WACC1.07
Cap/Depr(3y)24.57%
Cap/Depr(5y)30.81%
Cap/Sales(3y)0.68%
Cap/Sales(5y)0.92%
Profit Quality(3y)243.24%
Profit Quality(5y)223.09%
High Growth Momentum
Growth
EPS 1Y (TTM)34.02%
EPS 3Y32.68%
EPS 5Y13.84%
EPS Q2Q%13.04%
EPS Next Y20.95%
EPS Next 2Y16.76%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue 1Y (TTM)N/A
Revenue growth 3YN/A
Revenue growth 5YN/A
Sales Q2Q%16.07%
Revenue Next Year8.83%
Revenue Next 2Y8.32%
Revenue Next 3YN/A
Revenue Next 5YN/A
EBIT growth 1Y87.83%
EBIT growth 3Y29.94%
EBIT growth 5Y23.04%
EBIT Next Year103.99%
EBIT Next 3Y36.91%
EBIT Next 5YN/A
FCF growth 1Y160.23%
FCF growth 3Y12.91%
FCF growth 5Y7.55%
OCF growth 1Y146.3%
OCF growth 3Y12.13%
OCF growth 5Y7.45%