Taking everything into account, VAC scores 5 out of 10 in our fundamental rating. VAC was compared to 132 industry peers in the Hotels, Restaurants & Leisure industry. There are concerns on the financial health of VAC while its profitability can be described as average. VAC has a decent growth rate and is not valued too expensively. Finally VAC also has an excellent dividend rating.

Quickly go to:

1. Profitability

2. Health

3. Growth

4. Valuation

5. Dividend

1. Profitability

1.1 Basic Checks

VAC had positive earnings in the past year.
VAC had a positive operating cash flow in the past year.
Of the past 5 years VAC 4 years were profitable.
VAC had a positive operating cash flow in each of the past 5 years.

1.2 Ratios

With a Return On Assets value of 1.70%, VAC perfoms like the industry average, outperforming 48.48% of the companies in the same industry.
VAC has a Return On Equity of 7.02%. This is in the better half of the industry: VAC outperforms 65.15% of its industry peers.
VAC's Return On Invested Capital of 4.02% is in line compared to the rest of the industry. VAC outperforms 44.70% of its industry peers.
VAC had an Average Return On Invested Capital over the past 3 years of 4.94%. This is significantly below the industry average of 10.37%.

		Industry Rank	Sector Rank
ROA	1.7%
ROE	7.02%
ROIC	4.02%

ROA(3y)2.97%

ROA(5y)1.26%

ROE(3y)11.75%

ROE(5y)5.31%

ROIC(3y)4.94%

ROIC(5y)3.74%

1.3 Margins

With a Profit Margin value of 3.44%, VAC perfoms like the industry average, outperforming 55.30% of the companies in the same industry.
In the last couple of years the Profit Margin of VAC has grown nicely.
With a decent Operating Margin value of 11.10%, VAC is doing good in the industry, outperforming 61.36% of the companies in the same industry.
VAC's Operating Margin has declined in the last couple of years.
With a Gross Margin value of 50.38%, VAC perfoms like the industry average, outperforming 58.33% of the companies in the same industry.
VAC's Gross Margin has been stable in the last couple of years.

		Industry Rank	Sector Rank
OM	11.1%
PM (TTM)	3.44%
GM	50.38%

OM growth 3Y-2.56%

OM growth 5Y-3.62%

PM growth 3Y51.6%

PM growth 5Y6.26%

GM growth 3Y0.28%

GM growth 5Y-0.59%

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ROA

ROE

ROIC

Operating and Profit Margin

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2. Health

2.1 Basic Checks

VAC 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 VAC has been reduced compared to 1 year ago.
VAC has less shares outstanding than it did 5 years ago.
Compared to 1 year ago, VAC has a worse debt to assets ratio.

2.2 Solvency

Based on the Altman-Z score of 1.04, we must say that VAC is in the distress zone and has some risk of bankruptcy.
The Altman-Z score of VAC (1.04) is worse than 61.36% of its industry peers.
VAC has a debt to FCF ratio of 89.52. This is a negative value and a sign of low solvency as VAC would need 89.52 years to pay back of all of its debts.
VAC has a Debt to FCF ratio (89.52) which is in line with its industry peers.
A Debt/Equity ratio of 2.29 is on the high side and indicates that VAC has dependencies on debt financing.
VAC has a Debt to Equity ratio (2.29) which is in line with its industry peers.

		Industry Rank	Sector Rank
Debt/Equity	2.29
Debt/FCF	89.52
Altman-Z	1.04

ROIC/WACC0.64

WACC6.3%

2.3 Liquidity

A Current Ratio of 1.91 indicates that VAC should not have too much problems paying its short term obligations.
With an excellent Current ratio value of 1.91, VAC belongs to the best of the industry, outperforming 83.33% of the companies in the same industry.
VAC has a Quick Ratio of 1.04. This is a normal value and indicates that VAC is financially healthy and should not expect problems in meeting its short term obligations.
VAC has a Quick ratio of 1.04. This is comparable to the rest of the industry: VAC outperforms 59.09% of its industry peers.

		Industry Rank	Sector Rank
Current Ratio	1.91
Quick Ratio	1.04

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WACC

Debt/Equity

How to determine the health of a company

Altman-Z score

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3. Growth

3.1 Past

VAC shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 8.97%, which is quite good.
Measured over the past years, VAC shows a decrease in Earnings Per Share. The EPS has been decreasing by -3.50% on average per year.
Looking at the last year, VAC shows a small growth in Revenue. The Revenue has grown by 4.18% in the last year.
Measured over the past years, VAC shows a small growth in Revenue. The Revenue has been growing by 3.12% on average per year.

EPS 1Y (TTM)8.97%

EPS 3Y14.76%

EPS 5Y-3.5%

EPS Q2Q%-6.11%

Revenue 1Y (TTM)4.18%

Revenue growth 3Y8.49%

Revenue growth 5Y3.12%

Sales Q2Q%-3.22%

3.2 Future

Based on estimates for the next years, VAC will show a small growth in Earnings Per Share. The EPS will grow by 2.84% on average per year.
VAC is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 2.12% yearly.

EPS Next Y6.2%

EPS Next 2Y1.32%

EPS Next 3Y2.84%

EPS Next 5YN/A

Revenue Next Year2.37%

Revenue Next 2Y2.18%

Revenue Next 3Y2.12%

Revenue Next 5YN/A

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 accelerating.
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

A Price/Earnings ratio of 7.58 indicates a rather cheap valuation of VAC.
96.97% of the companies in the same industry are more expensive than VAC, based on the Price/Earnings ratio.
When comparing the Price/Earnings ratio of VAC to the average of the S&P500 Index (28.60), we can say VAC is valued rather cheaply.
The Price/Forward Earnings ratio is 8.07, which indicates a very decent valuation of VAC.
Based on the Price/Forward Earnings ratio, VAC is valued cheaply inside the industry as 93.18% of the companies are valued more expensively.
Compared to an average S&P500 Price/Forward Earnings ratio of 25.83, VAC is valued rather cheaply.

		Industry Rank	Sector Rank
PE	7.58
Fwd PE	8.07

4.2 Price Multiples

Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of VAC indicates a somewhat cheap valuation: VAC is cheaper than 65.91% of the companies listed in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of VAC is on the same level as its industry peers.

		Industry Rank	Sector Rank
P/FCF	29.87
EV/EBITDA	9.97

4.3 Compensation for Growth

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

PEG (NY)1.22

PEG (5Y)N/A

EPS Next 2Y1.32%

EPS Next 3Y2.84%

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5. Dividend

5.1 Amount

With a Yearly Dividend Yield of 5.42%, VAC is a good candidate for dividend investing.
VAC's Dividend Yield is rather good when compared to the industry average which is at 1.21. VAC pays more dividend than 94.70% of the companies in the same industry.
VAC's Dividend Yield is rather good when compared to the S&P500 average which is at 1.82.

		Industry Rank	Sector Rank
Dividend Yield	5.42%

5.2 History

The dividend of VAC is nicely growing with an annual growth rate of 10.51%!
VAC has paid a dividend for at least 10 years, which is a reliable track record.
VAC has not decreased its dividend in the last 3 years.

Dividend Growth(5Y)10.51%

Div Incr Years4

Div Non Decr Years4

5.3 Sustainability

78.61% of the earnings are spent on dividend by VAC. This is not a sustainable payout ratio.
The dividend of VAC is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.

DP78.61%

EPS Next 2Y1.32%

EPS Next 3Y2.84%

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MARRIOTT VACATIONS WORLD / VAC FAQ

What is the fundamental rating for VAC stock?

ChartMill assigns a fundamental rating of 5 / 10 to VAC.

What is the valuation status of MARRIOTT VACATIONS WORLD (VAC) stock?

ChartMill assigns a valuation rating of 6 / 10 to MARRIOTT VACATIONS WORLD (VAC). This can be considered as Fairly Valued.

Can you provide the profitability details for MARRIOTT VACATIONS WORLD?

MARRIOTT VACATIONS WORLD (VAC) has a profitability rating of 5 / 10.

What is the earnings growth outlook for MARRIOTT VACATIONS WORLD?

The Earnings per Share (EPS) of MARRIOTT VACATIONS WORLD (VAC) is expected to grow by 6.2% in the next year.

Is the dividend of MARRIOTT VACATIONS WORLD sustainable?

The dividend rating of MARRIOTT VACATIONS WORLD (VAC) is 7 / 10 and the dividend payout ratio is 78.61%.