RXO INC (RXO) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:RXO - US74982T1034 - Common Stock
14.53 USD
-0.57 (-3.77%)
14.5 USD
-0.03 (-0.21%)
Taking everything into account, RXO scores 3 out of 10 in our fundamental rating. RXO was compared to 42 industry peers in the Ground Transportation industry. While RXO seems to be doing ok healthwise, there are quite some concerns on its profitability. RXO is valied quite expensively at the moment, while it does show a decent growth rate.
1. Profitability
1.1 Basic Checks
- In the past year RXO was profitable.
- RXO had a positive operating cash flow in the past year.
- Of the past 5 years RXO 4 years were profitable.
- Of the past 5 years RXO 4 years had a positive operating cash flow.
1.2 Ratios
- RXO's Return On Assets of -2.47% is on the low side compared to the rest of the industry. RXO is outperformed by 64.29% of its industry peers.
- With a Return On Equity value of -5.00%, RXO is not doing good in the industry: 64.29% of the companies in the same industry are doing better.
- RXO has a worse Return On Invested Capital (0.38%) than 66.67% of its industry peers.
- Measured over the past 3 years, the Average Return On Invested Capital for RXO is in line with the industry average of 6.92%.
- The 3 year average ROIC (6.68%) for RXO is well above the current ROIC(0.38%). The reason for the recent decline needs to be investigated.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -2.47% | ||
| ROE | -5% | ||
| ROIC | 0.38% |
ROA(3y)-1.25%
ROA(5y)1.16%
ROE(3y)-0.55%
ROE(5y)3.28%
ROIC(3y)6.68%
ROIC(5y)7.55%
1.3 Margins
- RXO has a Operating Margin of 0.19%. This is in the lower half of the industry: RXO underperforms 66.67% of its industry peers.
- RXO's Operating Margin has declined in the last couple of years.
- Looking at the Gross Margin, with a value of 16.53%, RXO is doing worse than 71.43% of the companies in the same industry.
- In the last couple of years the Gross Margin of RXO has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 0.19% | ||
| PM (TTM) | N/A | ||
| GM | 16.53% |
OM growth 3Y-45.97%
OM growth 5Y-25.79%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y-0.37%
GM growth 5Y-0.88%
2. Health
2.1 Basic Checks
- RXO has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
- The number of shares outstanding for RXO has been increased compared to 1 year ago.
- The debt/assets ratio for RXO has been reduced compared to a year ago.
2.2 Solvency
- RXO has an Altman-Z score of 2.75. This is not the best score and indicates that RXO is in the grey zone with still only limited risk for bankruptcy at the moment.
- Looking at the Altman-Z score, with a value of 2.75, RXO is in line with its industry, outperforming 59.52% of the companies in the same industry.
- A Debt/Equity ratio of 0.24 indicates that RXO is not too dependend on debt financing.
- With a decent Debt to Equity ratio value of 0.24, RXO is doing good in the industry, outperforming 61.90% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.24 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 2.75 |
ROIC/WACC0.04
WACC10.28%
2.3 Liquidity
- A Current Ratio of 1.32 indicates that RXO should not have too much problems paying its short term obligations.
- RXO has a Current ratio (1.32) which is comparable to the rest of the industry.
- RXO has a Quick Ratio of 1.32. This is a normal value and indicates that RXO is financially healthy and should not expect problems in meeting its short term obligations.
- RXO has a better Quick ratio (1.32) than 61.90% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.32 | ||
| Quick Ratio | 1.32 |
3. Growth
3.1 Past
- RXO shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -27.27%.
- Looking at the last year, RXO shows a very strong growth in Revenue. The Revenue has grown by 53.85%.
- RXO shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 7.69% yearly.
EPS 1Y (TTM)-27.27%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%-80%
Revenue 1Y (TTM)53.85%
Revenue growth 3Y-1%
Revenue growth 5Y7.69%
Sales Q2Q%36.63%
3.2 Future
- The Earnings Per Share is expected to grow by 65.41% on average over the next years. This is a very strong growth
- The Revenue is expected to grow by 12.22% on average over the next years. This is quite good.
EPS Next Y-95.9%
EPS Next 2Y11.29%
EPS Next 3Y65.41%
EPS Next 5YN/A
Revenue Next Year26.91%
Revenue Next 2Y14.34%
Revenue Next 3Y11.77%
Revenue Next 5Y12.22%
3.3 Evolution
- 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
- The Price/Earnings ratio is 181.63, which means the current valuation is very expensive for RXO.
- RXO's Price/Earnings ratio is a bit more expensive when compared to the industry. RXO is more expensive than 64.29% of the companies in the same industry.
- The average S&P500 Price/Earnings ratio is at 28.87. RXO is valued rather expensively when compared to this.
- Based on the Price/Forward Earnings ratio of 106.64, the valuation of RXO can be described as expensive.
- Based on the Price/Forward Earnings ratio, RXO is valued a bit more expensive than 64.29% of the companies in the same industry.
- Compared to an average S&P500 Price/Forward Earnings ratio of 25.96, RXO is valued quite expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 181.63 | ||
| Fwd PE | 106.64 |
4.2 Price Multiples
- Based on the Enterprise Value to EBITDA ratio, RXO is valued a bit more expensive than the industry average as 64.29% of the companies are valued more cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 21.64 |
4.3 Compensation for Growth
- RXO's earnings are expected to grow with 65.41% in the coming years. This may justify a more expensive valuation.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y11.29%
EPS Next 3Y65.41%
5. Dividend
5.1 Amount
- RXO does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0% |
RXO INC / RXO FAQ
What is the fundamental rating for RXO stock?
ChartMill assigns a fundamental rating of 3 / 10 to RXO.
What is the valuation status for RXO stock?
ChartMill assigns a valuation rating of 1 / 10 to RXO INC (RXO). This can be considered as Overvalued.
What is the profitability of RXO stock?
RXO INC (RXO) has a profitability rating of 3 / 10.
What is the expected EPS growth for RXO INC (RXO) stock?
The Earnings per Share (EPS) of RXO INC (RXO) is expected to decline by -95.9% in the next year.