UL SOLUTIONS INC - CLASS A (ULS) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:ULS - US9037311076 - Common Stock
72.6 USD
-0.3 (-0.41%)
72.6 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 scores excellent points on both the profitability and health parts. This is a solid base for a good stock. ULS is valied quite expensively at the moment, while it does show a decent growth rate. These ratings could make ULS a good candidate 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.
- ULS has a better Return On Invested Capital (19.67%) 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 3 year average ROIC (17.03%) for ULS is below the current ROIC(19.67%), indicating increased profibility in the last year.
| 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 Profit Margin of 11.29%. This is amongst the best in the industry. ULS outperforms 80.68% of its industry peers.
- In the last couple of years the Profit Margin of ULS has grown nicely.
- ULS's Operating Margin of 17.28% is amongst the best of the industry. ULS outperforms 82.95% of its industry peers.
- In the last couple of years the Operating Margin of ULS has grown nicely.
- ULS has a Gross Margin of 48.88%. This is in the better half of the industry: ULS outperforms 64.77% of its industry peers.
- ULS's Gross Margin has been stable in the last couple of years.
| 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
- ULS has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
- The number of shares outstanding for ULS remains at a similar level compared to 1 year ago.
- ULS has a better debt/assets ratio than last year.
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's Altman-Z score of 7.07 is amongst the best of the industry. ULS outperforms 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.
- A Debt/Equity ratio of 0.46 indicates that ULS is not too dependend on debt financing.
- Looking at the Debt to Equity ratio, with a value of 0.46, ULS is in line with its industry, outperforming 50.00% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.46 | ||
| Debt/FCF | 1.4 | ||
| Altman-Z | 7.07 |
ROIC/WACC2.25
WACC8.73%
2.3 Liquidity
- A Current Ratio of 1.33 indicates that ULS should not have too much problems paying its short term obligations.
- Looking at the Current ratio, with a value of 1.33, ULS is in line with its industry, outperforming 45.45% of the companies in the same industry.
- A Quick Ratio of 1.33 indicates that ULS should not have too much problems paying its short term obligations.
- Looking at the Quick ratio, with a value of 1.33, ULS is in line with its industry, 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.
- Looking at the last year, ULS shows a small growth in Revenue. The Revenue has grown by 6.68% in the last year.
- Measured over the past years, ULS shows a small growth in Revenue. The Revenue has been growing by 4.47% on average per year.
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
- Based on estimates for the next years, ULS will show a quite strong growth in Earnings Per Share. The EPS will grow by 15.45% on average per year.
- ULS is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 5.95% yearly.
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
- When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
- 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
- ULS is valuated quite expensively with a Price/Earnings ratio of 41.72.
- Compared to the rest of the industry, the Price/Earnings ratio of ULS indicates a slightly more expensive valuation: ULS is more expensive than 61.36% of the companies listed in the same industry.
- When comparing the Price/Earnings ratio of ULS to the average of the S&P500 Index (27.30), we can say ULS is valued expensively.
- The Price/Forward Earnings ratio is 34.85, which means the current valuation is very expensive for ULS.
- Compared to the rest of the industry, the Price/Forward Earnings ratio of ULS indicates a slightly more expensive valuation: ULS is more expensive than 61.36% of the companies listed in the same industry.
- ULS is valuated rather expensively 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 | 41.72 | ||
| Fwd PE | 34.85 |
4.2 Price Multiples
- The rest of the industry has a similar Enterprise Value to EBITDA ratio as ULS.
- ULS's Price/Free Cash Flow is on the same level as the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 37.49 | ||
| EV/EBITDA | 21.16 |
4.3 Compensation for Growth
- The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
- ULS has an outstanding profitability rating, which 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)2.42
PEG (5Y)N/A
EPS Next 2Y13.4%
EPS Next 3Y13.87%
5. Dividend
5.1 Amount
- ULS has a yearly dividend return of 0.67%, which is pretty low.
- Compared to an average industry Dividend Yield of 1.41, ULS pays a bit more dividend than its industry peers.
- 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 | 0.67% |
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
- 30.38% of the earnings are spent on dividend by ULS. This is a low number and 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%.