UL SOLUTIONS INC - CLASS A (ULS) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:ULS - US9037311076 - Common Stock
71.2 USD
-1.4 (-1.93%)
71.2 USD
0 (0%)
We assign a fundamental rating of 6 out of 10 to ULS. ULS was compared to 88 industry peers in the Professional Services industry. ULS gets an excellent profitability rating and is at the same time showing great financial health properties. ULS is valied quite expensively at the moment, while it does show a decent growth rate. These ratings would make ULS suitable for quality investing!
1. Profitability
1.1 Basic Checks
- ULS had positive earnings in the past year.
- ULS had a positive operating cash flow in the past year.
1.2 Ratios
- Looking at the Return On Assets, with a value of 11.70%, ULS belongs to the top of the industry, outperforming 87.50% of the companies in the same industry.
- Looking at the Return On Equity, with a value of 28.42%, ULS belongs to the top of the industry, outperforming 85.23% of the companies in the same industry.
- The Return On Invested Capital of ULS (19.67%) is better than 92.05% of its industry peers.
- The Average Return On Invested Capital over the past 3 years for ULS is significantly above the industry average of 11.85%.
- The last Return On Invested Capital (19.67%) for ULS is above the 3 year average (17.03%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 11.7% | ||
| ROE | 28.42% | ||
| ROIC | 19.67% |
ROA(3y)10.64%
ROA(5y)N/A
ROE(3y)34.54%
ROE(5y)N/A
ROIC(3y)17.03%
ROIC(5y)N/A
1.3 Margins
- ULS has a better Profit Margin (11.29%) than 80.68% of its industry peers.
- In the last couple of years the Profit Margin of ULS has grown nicely.
- ULS has a better Operating Margin (17.28%) than 82.95% of its industry peers.
- ULS's Operating Margin has improved in the last couple of years.
- ULS has a better Gross Margin (48.88%) than 64.77% of its industry peers.
- In the last couple of years the Gross Margin of ULS has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 17.28% | ||
| PM (TTM) | 11.29% | ||
| GM | 48.88% |
OM growth 3Y12.18%
OM growth 5YN/A
PM growth 3Y8.47%
PM growth 5YN/A
GM growth 3Y1.19%
GM growth 5YN/A
2. Health
2.1 Basic Checks
- With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), ULS is creating value.
- ULS has about the same amout of shares outstanding than it did 1 year ago.
- Compared to 1 year ago, ULS has an improved debt to assets ratio.
2.2 Solvency
- ULS has an Altman-Z score of 7.07. This indicates that ULS is financially healthy and has little risk of bankruptcy at the moment.
- ULS has a better Altman-Z score (7.07) than 90.91% of its industry peers.
- ULS has a debt to FCF ratio of 1.40. This is a very positive value and a sign of high solvency as it would only need 1.40 years to pay back of all of its debts.
- With a decent Debt to FCF ratio value of 1.40, ULS is doing good in the industry, outperforming 76.14% of the companies in the same industry.
- ULS has a Debt/Equity ratio of 0.46. This is a healthy value indicating a solid balance between debt and equity.
- ULS has a Debt to Equity ratio (0.46) which is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.46 | ||
| Debt/FCF | 1.4 | ||
| Altman-Z | 7.07 |
ROIC/WACC2.26
WACC8.7%
2.3 Liquidity
- A Current Ratio of 1.33 indicates that ULS should not have too much problems paying its short term obligations.
- ULS has a Current ratio (1.33) which is in line with its industry peers.
- A Quick Ratio of 1.33 indicates that ULS should not have too much problems paying its short term obligations.
- With a Quick ratio value of 1.33, ULS perfoms like the industry average, outperforming 45.45% of the companies in the same industry.
- ULS does not score too well on the current and quick ratio evaluation. However, as it has excellent solvency and profitability, these ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.33 | ||
| Quick Ratio | 1.33 |
3. Growth
3.1 Past
- The Earnings Per Share has grown by an nice 11.00% over the past year.
- Measured over the past years, ULS shows a quite strong growth in Earnings Per Share. The EPS has been growing by 13.14% on average per year.
- ULS shows a small growth in Revenue. In the last year, the Revenue has grown by 6.68%.
- ULS shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 4.47% yearly.
EPS 1Y (TTM)11%
EPS 3Y13.14%
EPS 5YN/A
EPS Q2Q%27.27%
Revenue 1Y (TTM)6.68%
Revenue growth 3Y4.47%
Revenue growth 5YN/A
Sales Q2Q%7.11%
3.2 Future
- The Earnings Per Share is expected to grow by 15.45% on average over the next years. This is quite good.
- Based on estimates for the next years, ULS will show a small growth in Revenue. The Revenue will grow by 5.95% on average per year.
EPS Next Y17.25%
EPS Next 2Y13.4%
EPS Next 3Y13.87%
EPS Next 5Y15.45%
Revenue Next Year6.55%
Revenue Next 2Y6.05%
Revenue Next 3Y6.01%
Revenue Next 5Y5.95%
3.3 Evolution
- The EPS growth rate is stable: in the next years the growth will be about the same than in the last 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 40.92 indicates a quite expensive valuation of ULS.
- 61.36% of the companies in the same industry are cheaper than ULS, based on the Price/Earnings ratio.
- Compared to an average S&P500 Price/Earnings ratio of 27.21, ULS is valued quite expensively.
- ULS is valuated quite expensively with a Price/Forward Earnings ratio of 34.17.
- Based on the Price/Forward Earnings ratio, ULS is valued a bit more expensive than the industry average as 61.36% of the companies are valued more cheaply.
- Compared to an average S&P500 Price/Forward Earnings ratio of 24.26, ULS is valued a bit more expensive.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 40.92 | ||
| Fwd PE | 34.17 |
4.2 Price Multiples
- Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of ULS is on the same level as its industry peers.
- ULS's Price/Free Cash Flow is on the same level as the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 36.77 | ||
| EV/EBITDA | 21.16 |
4.3 Compensation for Growth
- The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates ULS does not grow enough to justify the current Price/Earnings ratio.
- The excellent profitability rating of ULS may justify a higher PE ratio.
- ULS's earnings are expected to grow with 13.87% in the coming years. This may justify a more expensive valuation.
PEG (NY)2.37
PEG (5Y)N/A
EPS Next 2Y13.4%
EPS Next 3Y13.87%
5. Dividend
5.1 Amount
- ULS has a yearly dividend return of 0.72%, which is pretty low.
- ULS's Dividend Yield is a higher than the industry average which is at 1.41.
- Compared to an average S&P500 Dividend Yield of 1.82, ULS's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.72% |
5.2 History
- ULS is new to the dividend game and has less than 3 years of track record.
Dividend Growth(5Y)N/A
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
- ULS pays out 30.38% of its income as dividend. This is a sustainable payout ratio.
DP30.38%
EPS Next 2Y13.4%
EPS Next 3Y13.87%
UL SOLUTIONS INC - CLASS A / ULS FAQ
What is the ChartMill fundamental rating of UL SOLUTIONS INC - CLASS A (ULS) stock?
ChartMill assigns a fundamental rating of 6 / 10 to ULS.
What is the valuation status for ULS stock?
ChartMill assigns a valuation rating of 2 / 10 to UL SOLUTIONS INC - CLASS A (ULS). This can be considered as Overvalued.
What is the profitability of ULS stock?
UL SOLUTIONS INC - CLASS A (ULS) has a profitability rating of 8 / 10.
How financially healthy is UL SOLUTIONS INC - CLASS A?
The financial health rating of UL SOLUTIONS INC - CLASS A (ULS) is 7 / 10.
Is the dividend of UL SOLUTIONS INC - CLASS A sustainable?
The dividend rating of UL SOLUTIONS INC - CLASS A (ULS) is 2 / 10 and the dividend payout ratio is 30.38%.