ROLLS-ROYCE HOLDINGS PLC (RRU.DE) Stock Fundamental Analysis
Europe - Frankfurt Stock Exchange - FRA:RRU - GB00B63H8491 - Common Stock
13.96 EUR
-0.18 (-1.27%)
RRU gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 53 industry peers in the Aerospace & Defense industry. While RRU belongs to the best of the industry regarding profitability, there are some minor concerns on its financial health. RRU is showing excellent growth while it is valued at reasonable prices. Keep and eye on this one! This makes RRU very considerable for growth investing!
1. Profitability
1.1 Basic Checks
- RRU had positive earnings in the past year.
- RRU had a positive operating cash flow in the past year.
- In multiple years RRU reported negative net income over the last 5 years.
- The reported operating cash flow has been mixed in the past 5 years: RRU reported negative operating cash flow in multiple years.
1.2 Ratios
- With an excellent Return On Assets value of 15.26%, RRU belongs to the best of the industry, outperforming 98.11% of the companies in the same industry.
- RRU has a Return On Equity of 240.37%. This is amongst the best in the industry. RRU outperforms 100.00% of its industry peers.
- The Return On Invested Capital of RRU (11.49%) is better than 73.58% of its industry peers.
- The Average Return On Invested Capital over the past 3 years for RRU is below the industry average of 9.24%.
- The 3 year average ROIC (6.58%) for RRU is below the current ROIC(11.49%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 15.26% | ||
| ROE | 240.37% | ||
| ROIC | 11.49% |
ROA(3y)3.47%
ROA(5y)0.02%
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)6.58%
ROIC(5y)N/A
1.3 Margins
- With an excellent Profit Margin value of 29.62%, RRU belongs to the best of the industry, outperforming 100.00% of the companies in the same industry.
- RRU's Profit Margin has improved in the last couple of years.
- RRU has a Operating Margin of 16.47%. This is amongst the best in the industry. RRU outperforms 88.68% of its industry peers.
- In the last couple of years the Operating Margin of RRU has grown nicely.
- Looking at the Gross Margin, with a value of 25.80%, RRU is in line with its industry, outperforming 45.28% of the companies in the same industry.
- RRU's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 16.47% | ||
| PM (TTM) | 29.62% | ||
| GM | 25.8% |
OM growth 3Y43.46%
OM growth 5YN/A
PM growth 3Y131.85%
PM growth 5YN/A
GM growth 3Y5.44%
GM growth 5Y31.49%
2. Health
2.1 Basic Checks
- With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), RRU is creating some value.
- Compared to 1 year ago, RRU has more shares outstanding
- Compared to 5 years ago, RRU has more shares outstanding
- Compared to 1 year ago, RRU has an improved debt to assets ratio.
2.2 Solvency
- An Altman-Z score of 2.66 indicates that RRU is not a great score, but indicates only limited risk for bankruptcy at the moment.
- RRU has a Altman-Z score (2.66) which is in line with its industry peers.
- RRU has a debt to FCF ratio of 1.55. This is a very positive value and a sign of high solvency as it would only need 1.55 years to pay back of all of its debts.
- With an excellent Debt to FCF ratio value of 1.55, RRU belongs to the best of the industry, outperforming 88.68% of the companies in the same industry.
- A Debt/Equity ratio of 1.18 is on the high side and indicates that RRU has dependencies on debt financing.
- Looking at the Debt to Equity ratio, with a value of 1.18, RRU is doing worse than 77.36% of the companies in the same industry.
- Even though the debt/equity ratio score it not favorable for RRU, it has very limited outstanding debt, so we won't put too much weight on the DE evaluation.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.18 | ||
| Debt/FCF | 1.55 | ||
| Altman-Z | 2.66 |
ROIC/WACC1.11
WACC10.31%
2.3 Liquidity
- A Current Ratio of 1.24 indicates that RRU should not have too much problems paying its short term obligations.
- The Current ratio of RRU (1.24) is better than 60.38% of its industry peers.
- A Quick Ratio of 0.93 indicates that RRU may have some problems paying its short term obligations.
- With a Quick ratio value of 0.93, RRU perfoms like the industry average, outperforming 58.49% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.24 | ||
| Quick Ratio | 0.93 |
3. Growth
3.1 Past
- The Earnings Per Share has grown by an impressive 51.97% over the past year.
- Measured over the past years, RRU shows a very strong growth in Earnings Per Share. The EPS has been growing by 29.95% on average per year.
- Looking at the last year, RRU shows a quite strong growth in Revenue. The Revenue has grown by 9.62% in the last year.
- RRU shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 2.66% yearly.
EPS 1Y (TTM)51.97%
EPS 3Y468.12%
EPS 5Y29.95%
EPS Q2Q%75.87%
Revenue 1Y (TTM)9.62%
Revenue growth 3Y19.01%
Revenue growth 5Y2.66%
Sales Q2Q%10.69%
3.2 Future
- The Earnings Per Share is expected to grow by 17.12% on average over the next years. This is quite good.
- RRU is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 8.92% yearly.
EPS Next Y45.77%
EPS Next 2Y29.01%
EPS Next 3Y23.84%
EPS Next 5Y17.12%
Revenue Next Year13.68%
Revenue Next 2Y11.64%
Revenue Next 3Y10.53%
Revenue Next 5Y8.92%
3.3 Evolution
- The estimated forward EPS growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
- 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
- A Price/Earnings ratio of 45.03 indicates a quite expensive valuation of RRU.
- The rest of the industry has a similar Price/Earnings ratio as RRU.
- RRU is valuated expensively when we compare the Price/Earnings ratio to 28.39, which is the current average of the S&P500 Index.
- The Price/Forward Earnings ratio is 36.02, which means the current valuation is very expensive for RRU.
- RRU's Price/Forward Earnings ratio is in line with the industry average.
- RRU's Price/Forward Earnings ratio indicates a valuation a bit more expensive than the S&P500 average which is at 25.72.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 45.03 | ||
| Fwd PE | 36.02 |
4.2 Price Multiples
- The rest of the industry has a similar Enterprise Value to EBITDA ratio as RRU.
- Based on the Price/Free Cash Flow ratio, RRU is valued a bit cheaper than the industry average as 79.25% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 32.01 | ||
| EV/EBITDA | 24.5 |
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.
- The decent profitability rating of RRU may justify a higher PE ratio.
- RRU's earnings are expected to grow with 23.84% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.98
PEG (5Y)1.5
EPS Next 2Y29.01%
EPS Next 3Y23.84%
5. Dividend
5.1 Amount
- RRU has a yearly dividend return of 0.84%, which is pretty low.
- RRU's Dividend Yield is a higher than the industry average which is at 0.74.
- With a Dividend Yield of 0.84, RRU pays less dividend than the S&P500 average, which is at 1.82.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.84% |
5.2 History
Dividend Growth(5Y)N/A
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
DPN/A
EPS Next 2Y29.01%
EPS Next 3Y23.84%
ROLLS-ROYCE HOLDINGS PLC / RRU.DE FAQ
What is the ChartMill fundamental rating of ROLLS-ROYCE HOLDINGS PLC (RRU.DE) stock?
ChartMill assigns a fundamental rating of 6 / 10 to RRU.DE.
What is the valuation status of ROLLS-ROYCE HOLDINGS PLC (RRU.DE) stock?
ChartMill assigns a valuation rating of 4 / 10 to ROLLS-ROYCE HOLDINGS PLC (RRU.DE). This can be considered as Fairly Valued.
How profitable is ROLLS-ROYCE HOLDINGS PLC (RRU.DE) stock?
ROLLS-ROYCE HOLDINGS PLC (RRU.DE) has a profitability rating of 7 / 10.
What is the financial health of ROLLS-ROYCE HOLDINGS PLC (RRU.DE) stock?
The financial health rating of ROLLS-ROYCE HOLDINGS PLC (RRU.DE) is 5 / 10.