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VALARIS LTD (VAL) Stock Fundamental Analysis

NYSE:VAL - New York Stock Exchange, Inc. - BMG9460G1015 - Common Stock - Currency: USD

33.2572  -2.44 (-6.84%)

Fundamental Rating

4

We assign a fundamental rating of 4 out of 10 to VAL. VAL was compared to 59 industry peers in the Energy Equipment & Services industry. Both the profitability and the financial health of VAL get a neutral evaluation. Nothing too spectacular is happening here. VAL has a decent growth rate and is not valued too expensively.


Dividend Valuation Growth Profitability Health

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4

1. Profitability

1.1 Basic Checks

VAL had positive earnings in the past year.
VAL had a positive operating cash flow in the past year.
In multiple years VAL reported negative net income over the last 5 years.
The reported operating cash flow has been mixed in the past 5 years: VAL reported negative operating cash flow in multiple years.
VAL Yearly Net Income VS EBIT VS OCF VS FCFVAL Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 1B -1B -2B -3B -4B

1.2 Ratios

With a decent Return On Assets value of 8.45%, VAL is doing good in the industry, outperforming 72.41% of the companies in the same industry.
With a decent Return On Equity value of 16.68%, VAL is doing good in the industry, outperforming 75.86% of the companies in the same industry.
With a Return On Invested Capital value of 7.67%, VAL perfoms like the industry average, outperforming 58.62% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for VAL is below the industry average of 8.11%.
The last Return On Invested Capital (7.67%) for VAL is above the 3 year average (3.38%), which is a sign of increasing profitability.
Industry RankSector Rank
ROA 8.45%
ROE 16.68%
ROIC 7.67%
ROA(3y)11.55%
ROA(5y)-35.11%
ROE(3y)24.63%
ROE(5y)-92.48%
ROIC(3y)3.38%
ROIC(5y)N/A
VAL Yearly ROA, ROE, ROICVAL Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 -100 -200 -300 -400

1.3 Margins

Looking at the Profit Margin, with a value of 15.80%, VAL belongs to the top of the industry, outperforming 87.93% of the companies in the same industry.
VAL has a Operating Margin of 15.38%. This is in the better half of the industry: VAL outperforms 74.14% of its industry peers.
Industry RankSector Rank
OM 15.38%
PM (TTM) 15.8%
GM N/A
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3YN/A
GM growth 5YN/A
VAL Yearly Profit, Operating, Gross MarginsVAL Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 -100 -200 -300

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4

2. Health

2.1 Basic Checks

The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so VAL is destroying value.
VAL has less shares outstanding than it did 1 year ago.
Compared to 5 years ago, VAL has more shares outstanding
The debt/assets ratio for VAL has been reduced compared to a year ago.
VAL Yearly Shares OutstandingVAL Yearly Shares OutstandingYearly Shares Outstanding 2016 2017 2018 2019 2020 2021 2022 2023 2024 20M 40M 60M
VAL Yearly Total Debt VS Total AssetsVAL Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2016 2017 2018 2019 2020 2021 2022 2023 2024 5B 10B 15B

2.2 Solvency

An Altman-Z score of 2.06 indicates that VAL is not a great score, but indicates only limited risk for bankruptcy at the moment.
VAL has a Altman-Z score of 2.06. This is in the better half of the industry: VAL outperforms 62.07% of its industry peers.
VAL has a Debt/Equity ratio of 0.48. This is a healthy value indicating a solid balance between debt and equity.
VAL has a Debt to Equity ratio (0.48) which is comparable to the rest of the industry.
Industry RankSector Rank
Debt/Equity 0.48
Debt/FCF N/A
Altman-Z 2.06
ROIC/WACC0.84
WACC9.09%
VAL Yearly LT Debt VS Equity VS FCFVAL Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 2B 4B 6B 8B

2.3 Liquidity

VAL has a Current Ratio of 1.59. This is a normal value and indicates that VAL is financially healthy and should not expect problems in meeting its short term obligations.
VAL's Current ratio of 1.59 is on the low side compared to the rest of the industry. VAL is outperformed by 62.07% of its industry peers.
A Quick Ratio of 1.59 indicates that VAL should not have too much problems paying its short term obligations.
VAL has a better Quick ratio (1.59) than 62.07% of its industry peers.
Industry RankSector Rank
Current Ratio 1.59
Quick Ratio 1.59
VAL Yearly Current Assets VS Current LiabilitesVAL Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2016 2017 2018 2019 2020 2021 2022 2023 2024 1B 2B 3B

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5

3. Growth

3.1 Past

The Earnings Per Share has grown by an impressive 414.00% over the past year.
Looking at the last year, VAL shows a very strong growth in Revenue. The Revenue has grown by 32.42%.
Measured over the past years, VAL shows a small growth in Revenue. The Revenue has been growing by 2.85% on average per year.
EPS 1Y (TTM)414%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%208.2%
Revenue 1Y (TTM)32.42%
Revenue growth 3Y24.23%
Revenue growth 5Y2.85%
Sales Q2Q%20.79%

3.2 Future

VAL is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 10.09% yearly.
VAL is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 4.60% yearly.
EPS Next Y-13.96%
EPS Next 2Y20.25%
EPS Next 3Y10.09%
EPS Next 5YN/A
Revenue Next Year-2.69%
Revenue Next 2Y3.49%
Revenue Next 3Y4.6%
Revenue Next 5YN/A

3.3 Evolution

The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
VAL Yearly Revenue VS EstimatesVAL Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 1B 2B 3B 4B
VAL Yearly EPS VS EstimatesVAL Yearly EPS VS EstimatesYearly EPS VS Estimates 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 0 10 -10 20 -20

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5

4. Valuation

4.1 Price/Earnings Ratio

A Price/Earnings ratio of 6.47 indicates a rather cheap valuation of VAL.
Based on the Price/Earnings ratio, VAL is valued cheaper than 98.28% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 29.98, VAL is valued rather cheaply.
With a Price/Forward Earnings ratio of 7.52, the valuation of VAL can be described as very cheap.
Based on the Price/Forward Earnings ratio, VAL is valued cheaply inside the industry as 93.10% of the companies are valued more expensively.
The average S&P500 Price/Forward Earnings ratio is at 22.66. VAL is valued rather cheaply when compared to this.
Industry RankSector Rank
PE 6.47
Fwd PE 7.52
VAL Price Earnings VS Forward Price EarningsVAL Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 5 10 15 20 25

4.2 Price Multiples

Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of VAL is on the same level as its industry peers.
Industry RankSector Rank
P/FCF N/A
EV/EBITDA 6.7
VAL Per share dataVAL EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 0 10 20 30

4.3 Compensation for Growth

PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y20.25%
EPS Next 3Y10.09%

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0

5. Dividend

5.1 Amount

VAL does not give a dividend.
Industry RankSector Rank
Dividend Yield N/A

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VALARIS LTD

NYSE:VAL (3/3/2025, 3:04:07 PM)

33.2572

-2.44 (-6.84%)

Chartmill FA Rating
GICS SectorEnergy
GICS IndustryGroupEnergy
GICS IndustryEnergy Equipment & Services
Earnings (Last)02-19 2025-02-19/amc
Earnings (Next)04-29 2025-04-29/bmo
Inst Owners96.44%
Inst Owner Change-2.85%
Ins Owners0.59%
Ins Owner Change16.08%
Market Cap2.37B
Analysts75.56
Price Target59.93 (80.2%)
Short Float %14.98%
Short Ratio6.2
Dividend
Industry RankSector Rank
Dividend Yield N/A
Yearly DividendN/A
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)32.67%
Min EPS beat(2)-16.03%
Max EPS beat(2)81.37%
EPS beat(4)3
Avg EPS beat(4)209.81%
Min EPS beat(4)-16.03%
Max EPS beat(4)589.07%
EPS beat(8)6
Avg EPS beat(8)188.78%
EPS beat(12)9
Avg EPS beat(12)290.24%
EPS beat(16)N/A
Avg EPS beat(16)N/A
Revenue beat(2)2
Avg Revenue beat(2)1.81%
Min Revenue beat(2)0.12%
Max Revenue beat(2)3.49%
Revenue beat(4)4
Avg Revenue beat(4)3.11%
Min Revenue beat(4)0.12%
Max Revenue beat(4)4.49%
Revenue beat(8)6
Avg Revenue beat(8)1.58%
Revenue beat(12)10
Avg Revenue beat(12)2.72%
Revenue beat(16)12
Avg Revenue beat(16)0.68%
PT rev (1m)-2.67%
PT rev (3m)-16.67%
EPS NQ rev (1m)2.53%
EPS NQ rev (3m)5.01%
EPS NY rev (1m)-6.76%
EPS NY rev (3m)-21.62%
Revenue NQ rev (1m)1.03%
Revenue NQ rev (3m)0.69%
Revenue NY rev (1m)-3.94%
Revenue NY rev (3m)-5.63%
Valuation
Industry RankSector Rank
PE 6.47
Fwd PE 7.52
P/S 1
P/FCF N/A
P/OCF 6.66
P/B 1.06
P/tB 1.06
EV/EBITDA 6.7
EPS(TTM)5.14
EY15.46%
EPS(NY)4.42
Fwd EY13.3%
FCF(TTM)-1.4
FCFYN/A
OCF(TTM)5
OCFY15.03%
SpS33.22
BVpS31.47
TBVpS31.48
PEG (NY)N/A
PEG (5Y)N/A
Profitability
Industry RankSector Rank
ROA 8.45%
ROE 16.68%
ROCE 9.71%
ROIC 7.67%
ROICexc 8.51%
ROICexgc 8.51%
OM 15.38%
PM (TTM) 15.8%
GM N/A
FCFM N/A
ROA(3y)11.55%
ROA(5y)-35.11%
ROE(3y)24.63%
ROE(5y)-92.48%
ROIC(3y)3.38%
ROIC(5y)N/A
ROICexc(3y)3.96%
ROICexc(5y)N/A
ROICexgc(3y)3.96%
ROICexgc(5y)N/A
ROCE(3y)4.28%
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 3YN/A
PM growth 5YN/A
GM growth 3YN/A
GM growth 5YN/A
F-Score5
Asset Turnover0.53
Health
Industry RankSector Rank
Debt/Equity 0.48
Debt/FCF N/A
Debt/EBITDA 2.23
Cap/Depr 372.73%
Cap/Sales 19.26%
Interest Coverage 4.64
Cash Conversion 73.22%
Profit Quality N/A
Current Ratio 1.59
Quick Ratio 1.59
Altman-Z 2.06
F-Score5
WACC9.09%
ROIC/WACC0.84
Cap/Depr(3y)429.41%
Cap/Depr(5y)266.33%
Cap/Sales(3y)23.73%
Cap/Sales(5y)16.51%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)414%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%208.2%
EPS Next Y-13.96%
EPS Next 2Y20.25%
EPS Next 3Y10.09%
EPS Next 5YN/A
Revenue 1Y (TTM)32.42%
Revenue growth 3Y24.23%
Revenue growth 5Y2.85%
Sales Q2Q%20.79%
Revenue Next Year-2.69%
Revenue Next 2Y3.49%
Revenue Next 3Y4.6%
Revenue Next 5YN/A
EBIT growth 1Y803.73%
EBIT growth 3YN/A
EBIT growth 5YN/A
EBIT Next Year72.4%
EBIT Next 3Y31.27%
EBIT Next 5YN/A
FCF growth 1Y76.74%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y32.86%
OCF growth 3YN/A
OCF growth 5YN/A