RESOURCES CONNECTION INC (RGP) Stock Fundamental Analysis
NASDAQ:RGP - Nasdaq - US76122Q1058 - Common Stock - Currency: USD
We assign a fundamental rating of 6 out of 10 to RGP. RGP was compared to 82 industry peers in the Professional Services industry. RGP is in great health and has no worries on liquidiy or solvency at all, but the profibility rating is only average. RGP is valued quite cheap, but it does not seem to be growing. RGP also has an excellent dividend rating.
1. Profitability
1.1 Basic Checks
RGP had positive earnings in the past year.
RGP had a positive operating cash flow in the past year.
In the past 5 years RGP has always been profitable.
Each year in the past 5 years RGP had a positive operating cash flow.
1.2 Ratios
With a Return On Assets value of -14.45%, RGP is not doing good in the industry: 79.75% of the companies in the same industry are doing better.
The Return On Equity of RGP (-18.85%) is worse than 78.48% of its industry peers.
With a Return On Invested Capital value of 3.48%, RGP perfoms like the industry average, outperforming 43.04% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for RGP is below the industry average of 13.72%.
The last Return On Invested Capital (3.48%) for RGP is well below the 3 year average (10.28%), which needs to be investigated, but indicates that RGP had better years and this may not be a problem.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -14.45% | ||
| ROE | -18.85% | ||
| ROIC | 3.48% |
ROA(3y)8.63%
ROA(5y)7.22%
ROE(3y)12.06%
ROE(5y)10.63%
ROIC(3y)10.28%
ROIC(5y)8.66%
1.3 Margins
RGP's Profit Margin has declined in the last couple of years.
The Operating Margin of RGP (2.89%) is comparable to the rest of the industry.
RGP's Operating Margin has declined in the last couple of years.
The Gross Margin of RGP (38.08%) is comparable to the rest of the industry.
In the last couple of years the Gross Margin of RGP has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 2.89% | ||
| PM (TTM) | N/A | ||
| GM | 38.08% |
OM growth 3Y-7.52%
OM growth 5Y-8.17%
PM growth 3Y-6.01%
PM growth 5Y-5.11%
GM growth 3Y0.47%
GM growth 5Y0.08%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), RGP is creating some value.
RGP has about the same amout of shares outstanding than it did 1 year ago.
Compared to 5 years ago, RGP has more shares outstanding
RGP 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
RGP has an Altman-Z score of 3.41. This indicates that RGP is financially healthy and has little risk of bankruptcy at the moment.
The Altman-Z score of RGP (3.41) is better than 64.56% of its industry peers.
There is no outstanding debt for RGP. This means it has a Debt/Equity and Debt/FCF ratio of 0 and it is amongst the best of the sector and industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0 | ||
| Altman-Z | 3.41 |
ROIC/WACC0.38
WACC9.18%
2.3 Liquidity
A Current Ratio of 2.74 indicates that RGP has no problem at all paying its short term obligations.
With an excellent Current ratio value of 2.74, RGP belongs to the best of the industry, outperforming 83.54% of the companies in the same industry.
A Quick Ratio of 2.74 indicates that RGP has no problem at all paying its short term obligations.
RGP has a Quick ratio of 2.74. This is amongst the best in the industry. RGP outperforms 83.54% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.74 | ||
| Quick Ratio | 2.74 |
3. Growth
3.1 Past
RGP shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -51.16%.
Measured over the past years, RGP shows a decrease in Earnings Per Share. The EPS has been decreasing by -1.04% on average per year.
Looking at the last year, RGP shows a very negative growth in Revenue. The Revenue has decreased by -17.38% in the last year.
Measured over the past years, RGP shows a decrease in Revenue. The Revenue has been decreasing by -2.79% on average per year.
EPS 1Y (TTM)-51.16%
EPS 3Y-4.27%
EPS 5Y-1.04%
EPS Q2Q%-35.71%
Revenue 1Y (TTM)-17.38%
Revenue growth 3Y0.17%
Revenue growth 5Y-2.79%
Sales Q2Q%-10.73%
3.2 Future
Based on estimates for the next years, RGP will show a very strong growth in Earnings Per Share. The EPS will grow by 27.63% on average per year.
Based on estimates for the next years, RGP will show a small growth in Revenue. The Revenue will grow by 1.56% on average per year.
EPS Next Y-85.34%
EPS Next 2Y27.63%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue Next Year-10.56%
Revenue Next 2Y3.9%
Revenue Next 3Y1.56%
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 accelerating.
The Revenue 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
Based on the Price/Earnings ratio of 12.17, the valuation of RGP can be described as correct.
Based on the Price/Earnings ratio, RGP is valued cheaper than 82.28% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 30.30, RGP is valued rather cheaply.
Based on the Price/Forward Earnings ratio of 5.06, the valuation of RGP can be described as very cheap.
96.20% of the companies in the same industry are more expensive than RGP, based on the Price/Forward Earnings ratio.
When comparing the Price/Forward Earnings ratio of RGP to the average of the S&P500 Index (23.06), we can say RGP is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.17 | ||
| Fwd PE | 5.06 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, RGP is valued cheaply inside the industry as 86.08% of the companies are valued more expensively.
RGP's Price/Free Cash Flow ratio is rather cheap when compared to the industry. RGP is cheaper than 89.87% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 11.08 | ||
| EV/EBITDA | 7.02 |
4.3 Compensation for Growth
RGP's earnings are expected to grow with 27.63% in the coming years. This may justify a more expensive valuation.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y27.63%
EPS Next 3YN/A
5. Dividend
5.1 Amount
RGP has a Yearly Dividend Yield of 6.87%, which is a nice return.
Compared to an average industry Dividend Yield of 1.93, RGP pays a better dividend. On top of this RGP pays more dividend than 100.00% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 2.29, RGP pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 6.87% |
5.2 History
The dividend of RGP has a limited annual growth rate of 1.89%.
RGP has been paying a dividend for at least 10 years, so it has a reliable track record.
RGP has not decreased its dividend in the past 5 years, so it has a somewhat stable track record.
Dividend Growth(5Y)1.89%
Div Incr Years0
Div Non Decr Years8
5.3 Sustainability
RGP has negative earnings and hence a negative payout ratio. The dividend may be in danger.
The dividend of RGP is growing, but earnings are growing more, so the dividend growth is sustainable.
DP-30.63%
EPS Next 2Y27.63%
EPS Next 3YN/A
7.67
-0.29 (-3.64%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCommercial & Professional Services
GICS IndustryProfessional Services
Earnings (Last)
Earnings (Next)
Inst Owners91.51%
Inst Owner ChangeN/A
Ins Owners1.94%
Ins Owner Change0.75%
Market Cap253.80M
Analysts48
Price Target13.39 (74.58%)
Short Float %2.28%
Short Ratio2.09
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 6.87% |
Yearly Dividend0.56
Dividend Growth(5Y)1.89%
DP-30.63%
Div Incr Years0
Div Non Decr Years8
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)2575.94%
Min EPS beat(2)-100%
Max EPS beat(2)5251.89%
EPS beat(4)3
Avg EPS beat(4)1408.99%
Min EPS beat(4)-100%
Max EPS beat(4)5251.89%
EPS beat(8)7
Avg EPS beat(8)726.73%
EPS beat(12)11
Avg EPS beat(12)497.69%
EPS beat(16)15
Avg EPS beat(16)411.35%
Revenue beat(2)1
Avg Revenue beat(2)1.76%
Min Revenue beat(2)-1.7%
Max Revenue beat(2)5.22%
Revenue beat(4)2
Avg Revenue beat(4)1.49%
Min Revenue beat(4)-1.94%
Max Revenue beat(4)5.22%
Revenue beat(8)4
Avg Revenue beat(8)0.76%
Revenue beat(12)7
Avg Revenue beat(12)1.07%
Revenue beat(16)11
Avg Revenue beat(16)1.63%
PT rev (1m)0%
PT rev (3m)0%
EPS NQ rev (1m)-169.77%
EPS NQ rev (3m)-137.97%
EPS NY rev (1m)-61.43%
EPS NY rev (3m)-73%
Revenue NQ rev (1m)-15.52%
Revenue NQ rev (3m)-23.57%
Revenue NY rev (1m)-0.24%
Revenue NY rev (3m)-5.66%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.17 | ||
| Fwd PE | 5.06 | ||
| P/S | 0.44 | ||
| P/FCF | 11.08 | ||
| P/OCF | 10.09 | ||
| P/B | 0.78 | ||
| P/tB | 1.55 | ||
| EV/EBITDA | 7.02 |
EPS(TTM)0.63
EY8.21%
EPS(NY)1.52
Fwd EY19.75%
FCF(TTM)0.69
FCFY9.02%
OCF(TTM)0.76
OCFY9.92%
SpS17.59
BVpS9.84
TBVpS4.95
PEG (NY)N/A
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -14.45% | ||
| ROE | -18.85% | ||
| ROCE | 4.79% | ||
| ROIC | 3.48% | ||
| ROICexc | 4.48% | ||
| ROICexgc | 11% | ||
| OM | 2.89% | ||
| PM (TTM) | N/A | ||
| GM | 38.08% | ||
| FCFM | 3.93% |
ROA(3y)8.63%
ROA(5y)7.22%
ROE(3y)12.06%
ROE(5y)10.63%
ROIC(3y)10.28%
ROIC(5y)8.66%
ROICexc(3y)13.68%
ROICexc(5y)11.32%
ROICexgc(3y)41.16%
ROICexgc(5y)34.71%
ROCE(3y)14.15%
ROCE(5y)11.92%
ROICexcg growth 3Y-5.93%
ROICexcg growth 5Y-14.66%
ROICexc growth 3Y-5.91%
ROICexc growth 5Y-13.1%
OM growth 3Y-7.52%
OM growth 5Y-8.17%
PM growth 3Y-6.01%
PM growth 5Y-5.11%
GM growth 3Y0.47%
GM growth 5Y0.08%
F-Score5
Asset Turnover1.37
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0 | ||
| Debt/EBITDA | 0 | ||
| Cap/Depr | 27.71% | ||
| Cap/Sales | 0.39% | ||
| Interest Coverage | 47.43 | ||
| Cash Conversion | 100.67% | ||
| Profit Quality | N/A | ||
| Current Ratio | 2.74 | ||
| Quick Ratio | 2.74 | ||
| Altman-Z | 3.41 |
F-Score5
WACC9.18%
ROIC/WACC0.38
Cap/Depr(3y)23.98%
Cap/Depr(5y)27.19%
Cap/Sales(3y)0.27%
Cap/Sales(5y)0.35%
Profit Quality(3y)104.77%
Profit Quality(5y)124.84%
High Growth Momentum
Growth
EPS 1Y (TTM)-51.16%
EPS 3Y-4.27%
EPS 5Y-1.04%
EPS Q2Q%-35.71%
EPS Next Y-85.34%
EPS Next 2Y27.63%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue 1Y (TTM)-17.38%
Revenue growth 3Y0.17%
Revenue growth 5Y-2.79%
Sales Q2Q%-10.73%
Revenue Next Year-10.56%
Revenue Next 2Y3.9%
Revenue Next 3Y1.56%
Revenue Next 5YN/A
EBIT growth 1Y-61.03%
EBIT growth 3Y-7.36%
EBIT growth 5Y-10.73%
EBIT Next Year-19.06%
EBIT Next 3YN/A
EBIT Next 5YN/A
FCF growth 1Y-66.22%
FCF growth 3Y-16.81%
FCF growth 5Y-10.77%
OCF growth 1Y-63.86%
OCF growth 3Y-18.13%
OCF growth 5Y-12.86%