ROYAL BANK OF CANADA(NYSE:RY) stock Fundamental Analysis

Fundamental Rating

We assign a fundamental rating of 3 out of 10 to RY. RY was compared to 405 industry peers in the Banks industry. While RY is still in line with the averages on profitability rating, there are concerns on its financial health. RY is quite expensive at the moment. It does show a decent growth rate. RY also has an excellent dividend rating.

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1. Profitability

1.1 Basic Checks

In the past year RY was profitable.

In the past year RY had a positive cash flow from operations.

In the past 5 years RY has always been profitable.

RY had a positive operating cash flow in each of the past 5 years.

1.2 Ratios

Looking at the Return On Assets, with a value of 0.73%, RY is in line with its industry, outperforming 43.47% of the companies in the same industry.

RY's Return On Equity of 12.52% is amongst the best of the industry. RY outperforms 86.68% of its industry peers.

		Industry Rank	Sector Rank
ROA	0.73%
ROE	12.52%
ROIC	N/A

ROA(3y)0.76%

ROA(5y)0.78%

ROE(3y)13.11%

ROE(5y)13.64%

ROIC(3y)N/A

ROIC(5y)N/A

1.3 Margins

With a decent Profit Margin value of 27.74%, RY is doing good in the industry, outperforming 76.38% of the companies in the same industry.

RY's Profit Margin has been stable in the last couple of years.

The Operating Margin and Gross Margin are not available for RY so they could not be analyzed.

		Industry Rank	Sector Rank
OM	N/A
PM (TTM)	27.74%
GM	N/A

OM growth 3YN/A

OM growth 5YN/A

PM growth 3Y-4.41%

PM growth 5Y0.27%

GM growth 3YN/A

GM growth 5YN/A

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ROA

ROE

ROIC

Operating and Profit Margin

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2. Health

2.1 Basic Checks

RY does not have a ROIC to compare to the WACC, probably because it is not profitable.

The number of shares outstanding for RY has been increased compared to 1 year ago.

The number of shares outstanding for RY has been reduced compared to 5 years ago.

The debt/assets ratio for RY has been reduced compared to a year ago.

2.2 Solvency

RY has a debt to FCF ratio of 16.98. This is a negative value and a sign of low solvency as RY would need 16.98 years to pay back of all of its debts.

Looking at the Debt to FCF ratio, with a value of 16.98, RY is doing worse than 76.88% of the companies in the same industry.

RY has a Debt/Equity ratio of 2.79. This is a high value indicating a heavy dependency on external financing.

Looking at the Debt to Equity ratio, with a value of 2.79, RY is doing worse than 94.97% of the companies in the same industry.

		Industry Rank	Sector Rank
Debt/Equity	2.79
Debt/FCF	16.98
Altman-Z	N/A

ROIC/WACCN/A

WACC13.67%

2.3 Liquidity

		Industry Rank	Sector Rank
Current Ratio	N/A
Quick Ratio	N/A

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WACC

Debt/Equity

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Altman-Z score

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3. Growth

3.1 Past

RY shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 7.25%.

The Earnings Per Share has been growing slightly by 6.53% on average over the past years.

RY shows a small growth in Revenue. In the last year, the Revenue has grown by 2.16%.

Measured over the past years, RY shows a small growth in Revenue. The Revenue has been growing by 4.51% on average per year.

EPS 1Y (TTM)7.25%

EPS 3Y2.91%

EPS 5Y6.53%

EPS Q2Q%13.84%

Revenue 1Y (TTM)2.16%

Revenue growth 3Y4.89%

Revenue growth 5Y4.51%

Sales Q2Q%19.19%

3.2 Future

The Earnings Per Share is expected to grow by 9.39% on average over the next years. This is quite good.

RY is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 0.57% yearly.

EPS Next Y9.34%

EPS Next 2Y9.39%

EPS Next 3YN/A

EPS Next 5YN/A

Revenue Next Year7.24%

Revenue Next 2Y6.38%

Revenue Next 3Y0.57%

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.

The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.

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4. Valuation

4.1 Price/Earnings Ratio

Based on the Price/Earnings ratio of 14.38, the valuation of RY can be described as correct.

RY's Price/Earnings is on the same level as the industry average.

RY is valuated rather cheaply when we compare the Price/Earnings ratio to 28.29, which is the current average of the S&P500 Index.

With a Price/Forward Earnings ratio of 13.15, RY is valued correctly.

The rest of the industry has a similar Price/Forward Earnings ratio as RY.

Compared to an average S&P500 Price/Forward Earnings ratio of 24.44, RY is valued a bit cheaper.

		Industry Rank	Sector Rank
PE	14.38
Fwd PE	13.15

4.2 Price Multiples

Compared to the rest of the industry, the Price/Free Cash Flow ratio of RY is on the same level as its industry peers.

		Industry Rank	Sector Rank
P/FCF	11.89
EV/EBITDA	N/A

4.3 Compensation for Growth

The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.

PEG (NY)1.54

PEG (5Y)2.2

EPS Next 2Y9.39%

EPS Next 3YN/A

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5. Dividend

5.1 Amount

With a Yearly Dividend Yield of 3.42%, RY has a reasonable but not impressive dividend return.

RY's Dividend Yield is a higher than the industry average which is at 3.22.

Compared to an average S&P500 Dividend Yield of 2.28, RY pays a better dividend.

		Industry Rank	Sector Rank
Dividend Yield	3.42%

5.2 History

The dividend of RY has a limited annual growth rate of 2.34%.

RY has paid a dividend for at least 10 years, which is a reliable track record.

RY has not decreased its dividend in the past 5 years, so it has a somewhat stable track record.

Dividend Growth(5Y)2.34%

Div Incr Years8

Div Non Decr Years8

5.3 Sustainability

RY pays out 41.72% of its income as dividend. This is a bit on the high side, but may be sustainable.

RY's earnings are growing more than its dividend. This makes the dividend growth sustainable.

DP41.72%

EPS Next 2Y9.39%

EPS Next 3YN/A

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ROYAL BANK OF CANADA

NYSE:RY (1/22/2025, 2:08:47 PM)

121.355

-0.88 (-0.72%)

Chartmill FA Rating

GICS SectorFinancials

GICS IndustryGroupBanks

GICS IndustryBanks

Earnings (Last)12-04 2024-12-04/bmo

Earnings (Next)N/A N/A

Inst Owners52.58%

Inst Owner Change-0.19%

Ins Owners0.01%

Ins Owner ChangeN/A

Market Cap171.73B

Analysts81.6

Price Target126.59 (4.31%)

Short Float %0.41%

Short Ratio6.01

Dividend

		Industry Rank	Sector Rank
Dividend Yield	3.42%

Yearly Dividend4.71

Dividend Growth(5Y)2.34%

DP41.72%

Div Incr Years8

Div Non Decr Years8

Ex-Date01-27 2025-01-27 (1.48)

Surprises & Revisions

EPS beat(2)2

Avg EPS beat(2)4.43%

Min EPS beat(2)2.14%

Max EPS beat(2)6.71%

EPS beat(4)3

Avg EPS beat(4)2.65%

Min EPS beat(4)-1.26%

Max EPS beat(4)6.71%

EPS beat(8)6

Avg EPS beat(8)1.25%

EPS beat(12)9

Avg EPS beat(12)1.24%

EPS beat(16)12

Avg EPS beat(16)2.51%

Revenue beat(2)1

Avg Revenue beat(2)0.83%

Min Revenue beat(2)-1.13%

Max Revenue beat(2)2.78%

Revenue beat(4)2

Avg Revenue beat(4)0.1%

Min Revenue beat(4)-2.8%

Max Revenue beat(4)2.78%

Revenue beat(8)5

Avg Revenue beat(8)1.49%

Revenue beat(12)6

Avg Revenue beat(12)0.2%

Revenue beat(16)9

Avg Revenue beat(16)0.91%

PT rev (1m)-0.81%

PT rev (3m)1.8%

EPS NQ rev (1m)0%

EPS NQ rev (3m)1.81%

EPS NY rev (1m)0%

EPS NY rev (3m)3.09%

Revenue NQ rev (1m)0%

Revenue NQ rev (3m)4.16%

Revenue NY rev (1m)1.11%

Revenue NY rev (3m)1.05%

Valuation

		Industry Rank	Sector Rank
PE	14.38
Fwd PE	13.15
P/S	4.33
P/FCF	11.89
P/OCF	10.72
P/B	1.95
P/tB	2.48
EV/EBITDA	N/A

EPS(TTM)8.44

EY6.95%

EPS(NY)9.23

Fwd EY7.61%

FCF(TTM)10.2

FCFY8.41%

OCF(TTM)11.32

OCFY9.33%

SpS28.05

BVpS62.16

TBVpS48.92

PEG (NY)1.54

PEG (5Y)2.2

Profitability

		Industry Rank	Sector Rank
ROA	0.73%
ROE	12.52%
ROCE	N/A
ROIC	N/A
ROICexc	N/A
ROICexgc	N/A
OM	N/A
PM (TTM)	27.74%
GM	N/A
FCFM	36.38%

ROA(3y)0.76%

ROA(5y)0.78%

ROE(3y)13.11%

ROE(5y)13.64%

ROIC(3y)N/A

ROIC(5y)N/A

ROICexc(3y)N/A

ROICexc(5y)N/A

ROICexgc(3y)N/A

ROICexgc(5y)N/A

ROCE(3y)N/A

ROCE(5y)N/A

ROICexcg growth 3YN/A

ROICexcg growth 5YN/A

ROICexc growth 3YN/A

ROICexc growth 5YN/A

OM growth 3YN/A

OM growth 5YN/A

PM growth 3Y-4.41%

PM growth 5Y0.27%

GM growth 3YN/A

GM growth 5YN/A

F-Score6

Asset Turnover0.03

Health

		Industry Rank	Sector Rank
Debt/Equity	2.79
Debt/FCF	16.98
Debt/EBITDA	N/A
Cap/Depr	76.48%
Cap/Sales	3.98%
Interest Coverage	N/A
Cash Conversion	N/A
Profit Quality	131.12%
Current Ratio	N/A
Quick Ratio	N/A
Altman-Z	N/A

F-Score6

WACC13.67%

ROIC/WACCN/A

Cap/Depr(3y)88.62%

Cap/Depr(5y)89.9%

Cap/Sales(3y)4.65%

Cap/Sales(5y)4.78%

Profit Quality(3y)138.62%

Profit Quality(5y)401.74%

High Growth Momentum

Growth

EPS 1Y (TTM)7.25%

EPS 3Y2.91%

EPS 5Y6.53%

EPS Q2Q%13.84%

EPS Next Y9.34%

EPS Next 2Y9.39%

EPS Next 3YN/A

EPS Next 5YN/A

Revenue 1Y (TTM)2.16%

Revenue growth 3Y4.89%

Revenue growth 5Y4.51%

Sales Q2Q%19.19%

Revenue Next Year7.24%

Revenue Next 2Y6.38%

Revenue Next 3Y0.57%

Revenue Next 5YN/A

EBIT growth 1YN/A

EBIT growth 3YN/A

EBIT growth 5YN/A

EBIT Next Year8.94%

EBIT Next 3YN/A

EBIT Next 5YN/A

FCF growth 1Y-10.66%

FCF growth 3Y-29.23%

FCF growth 5Y11.68%

OCF growth 1Y-11.27%

OCF growth 3Y-27.63%

OCF growth 5Y10.16%

ROYAL BANK OF CANADA (RY) Stock Fundamental Analysis

1. Profitability

1.1 Basic Checks

1.2 Ratios

1.3 Margins

More info and screens

2. Health

2.1 Basic Checks

2.2 Solvency

2.3 Liquidity

More info and screens

3. Growth

3.1 Past

3.2 Future

3.3 Evolution

More info and screens

4. Valuation

4.1 Price/Earnings Ratio

4.2 Price Multiples

4.3 Compensation for Growth

More info and screens

5. Dividend

5.1 Amount

5.2 History

5.3 Sustainability

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