TAL EDUCATION GROUP- ADR (TAL) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:TAL - US8740801043 - ADR
11.13 USD
+0.34 (+3.15%)
11.13 USD
0 (0%)
We assign a fundamental rating of 5 out of 10 to TAL. TAL was compared to 76 industry peers in the Diversified Consumer Services industry. No worries on liquidiy or solvency for TAL as it has an excellent financial health rating, but there are worries on the profitability. TAL is not valued too expensively and it also shows a decent growth rate.
1. Profitability
1.1 Basic Checks
- In the past year TAL was profitable.
- TAL had a positive operating cash flow in the past year.
- In the past 5 years TAL reported 4 times negative net income.
- TAL had a positive operating cash flow in 4 of the past 5 years.
1.2 Ratios
- TAL has a Return On Assets (3.14%) which is in line with its industry peers.
- With a Return On Equity value of 4.98%, TAL perfoms like the industry average, outperforming 56.58% of the companies in the same industry.
- TAL's Return On Invested Capital of 1.62% is in line compared to the rest of the industry. TAL outperforms 53.95% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.14% | ||
| ROE | 4.98% | ||
| ROIC | 1.62% |
ROA(3y)-0.47%
ROA(5y)-4.94%
ROE(3y)-0.46%
ROE(5y)-6.36%
ROIC(3y)N/A
ROIC(5y)N/A
1.3 Margins
- TAL has a Profit Margin of 6.45%. This is in the better half of the industry: TAL outperforms 63.16% of its industry peers.
- TAL's Operating Margin of 2.90% is in line compared to the rest of the industry. TAL outperforms 52.63% of its industry peers.
- TAL has a Gross Margin of 54.42%. This is in the better half of the industry: TAL outperforms 68.42% of its industry peers.
- In the last couple of years the Gross Margin of TAL has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 2.9% | ||
| PM (TTM) | 6.45% | ||
| GM | 54.42% |
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y2.3%
GM growth 5Y-0.66%
2. Health
2.1 Basic Checks
- TAL has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
- Compared to 1 year ago, TAL has less shares outstanding
- Compared to 5 years ago, TAL has more shares outstanding
- TAL 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
- TAL has an Altman-Z score of 2.87. This is not the best score and indicates that TAL is in the grey zone with still only limited risk for bankruptcy at the moment.
- TAL has a Altman-Z score of 2.87. This is in the better half of the industry: TAL outperforms 69.74% of its industry peers.
- There is no outstanding debt for TAL. 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 | 2.87 |
ROIC/WACC0.21
WACC7.54%
2.3 Liquidity
- TAL has a Current Ratio of 2.28. This indicates that TAL is financially healthy and has no problem in meeting its short term obligations.
- Looking at the Current ratio, with a value of 2.28, TAL is in the better half of the industry, outperforming 78.95% of the companies in the same industry.
- A Quick Ratio of 2.20 indicates that TAL has no problem at all paying its short term obligations.
- The Quick ratio of TAL (2.20) is better than 78.95% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.28 | ||
| Quick Ratio | 2.2 |
3. Growth
3.1 Past
- The Earnings Per Share has grown by an impressive 52.00% over the past year.
- The Revenue has grown by 44.45% in the past year. This is a very strong growth!
- Measured over the past years, TAL shows a decrease in Revenue. The Revenue has been decreasing by -7.22% on average per year.
EPS 1Y (TTM)52%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%100%
Revenue 1Y (TTM)44.45%
Revenue growth 3Y-19.98%
Revenue growth 5Y-7.22%
Sales Q2Q%39.07%
3.2 Future
- Based on estimates for the next years, TAL will show a very strong growth in Earnings Per Share. The EPS will grow by 59.59% on average per year.
- Based on estimates for the next years, TAL will show a quite strong growth in Revenue. The Revenue will grow by 18.00% on average per year.
EPS Next Y93.83%
EPS Next 2Y61.07%
EPS Next 3Y50.87%
EPS Next 5Y59.59%
Revenue Next Year33.71%
Revenue Next 2Y28.94%
Revenue Next 3Y25.73%
Revenue Next 5Y18%
3.3 Evolution
- When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
- A Price/Earnings ratio of 29.29 indicates a quite expensive valuation of TAL.
- The rest of the industry has a similar Price/Earnings ratio as TAL.
- TAL's Price/Earnings ratio indicates a similar valuation than the S&P500 average which is at 27.32.
- With a Price/Forward Earnings ratio of 17.87, TAL is valued on the expensive side.
- 69.74% of the companies in the same industry are more expensive than TAL, based on the Price/Forward Earnings ratio.
- TAL is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 24.32, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 29.29 | ||
| Fwd PE | 17.87 |
4.2 Price Multiples
- Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of TAL is on the same level as its industry peers.
- TAL's Price/Free Cash Flow ratio is rather cheap when compared to the industry. TAL is cheaper than 92.11% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 9.56 | ||
| EV/EBITDA | 12.51 |
4.3 Compensation for Growth
- TAL's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
- TAL's earnings are expected to grow with 50.87% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.31
PEG (5Y)N/A
EPS Next 2Y61.07%
EPS Next 3Y50.87%
5. Dividend
5.1 Amount
- TAL does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0% |
TAL EDUCATION GROUP- ADR / TAL FAQ
What is the ChartMill fundamental rating of TAL EDUCATION GROUP- ADR (TAL) stock?
ChartMill assigns a fundamental rating of 5 / 10 to TAL.
Can you provide the valuation status for TAL EDUCATION GROUP- ADR?
ChartMill assigns a valuation rating of 5 / 10 to TAL EDUCATION GROUP- ADR (TAL). This can be considered as Fairly Valued.
How profitable is TAL EDUCATION GROUP- ADR (TAL) stock?
TAL EDUCATION GROUP- ADR (TAL) has a profitability rating of 3 / 10.
What is the earnings growth outlook for TAL EDUCATION GROUP- ADR?
The Earnings per Share (EPS) of TAL EDUCATION GROUP- ADR (TAL) is expected to grow by 93.83% in the next year.
Can you provide the dividend sustainability for TAL stock?
The dividend rating of TAL EDUCATION GROUP- ADR (TAL) is 0 / 10 and the dividend payout ratio is -38.57%.