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VALARIS LTD (VAL) Stock Fundamental Analysis

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

48.77  +1.45 (+3.06%)

After market: 48.77 0 (0%)

Fundamental Rating

4

VAL gets a fundamental rating of 4 out of 10. The analysis compared the fundamentals against 58 industry peers in the Energy Equipment & Services industry. There are concerns on the financial health of VAL while its profitability can be described as average. VAL has a correct valuation and a medium growth rate.


Dividend Valuation Growth Profitability Health

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4

1. Profitability

1.1 Basic Checks

In the past year VAL was profitable.
VAL had a positive operating cash flow in the past year.
The reported net income has been mixed in the past 5 years: VAL reported negative net income in multiple 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 0 1B -1B -2B -3B -4B

1.2 Ratios

The Return On Assets of VAL (24.81%) is better than 96.55% of its industry peers.
Looking at the Return On Equity, with a value of 50.83%, VAL belongs to the top of the industry, outperforming 96.55% of the companies in the same industry.
VAL has a Return On Invested Capital (6.32%) which is comparable to the rest of the industry.
Industry RankSector Rank
ROA 24.81%
ROE 50.83%
ROIC 6.32%
ROA(3y)-48.76%
ROA(5y)-37.03%
ROE(3y)-122.7%
ROE(5y)-96.24%
ROIC(3y)N/A
ROIC(5y)N/A
VAL Yearly ROA, ROE, ROICVAL Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2016 2017 2018 2019 2020 2021 2022 2023 0 -100 -200 -300 -400

1.3 Margins

VAL has a Profit Margin of 47.52%. This is amongst the best in the industry. VAL outperforms 100.00% of its industry peers.
With a decent Operating Margin value of 12.59%, VAL is doing good in the industry, outperforming 67.24% of the companies in the same industry.
Industry RankSector Rank
OM 12.59%
PM (TTM) 47.52%
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 0 -100 -200 -300

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3

2. Health

2.1 Basic Checks

With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), VAL is destroying value.
Compared to 1 year ago, VAL has less shares outstanding
VAL has more shares outstanding than it did 5 years ago.
The debt/assets ratio for VAL is higher compared to a year ago.
VAL Yearly Shares OutstandingVAL Yearly Shares OutstandingYearly Shares Outstanding 2016 2017 2018 2019 2020 2021 2022 2023 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 5B 10B 15B

2.2 Solvency

An Altman-Z score of 2.17 indicates that VAL is not a great score, but indicates only limited risk for bankruptcy at the moment.
VAL has a better Altman-Z score (2.17) than 62.07% of its industry peers.
A Debt/Equity ratio of 0.51 indicates that VAL is somewhat dependend on debt financing.
With a Debt to Equity ratio value of 0.51, VAL perfoms like the industry average, outperforming 41.38% of the companies in the same industry.
Industry RankSector Rank
Debt/Equity 0.51
Debt/FCF N/A
Altman-Z 2.17
ROIC/WACC0.74
WACC8.55%
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 0 2B 4B 6B 8B

2.3 Liquidity

A Current Ratio of 1.61 indicates that VAL should not have too much problems paying its short term obligations.
VAL has a Current ratio of 1.61. This is in the lower half of the industry: VAL underperforms 63.79% of its industry peers.
VAL has a Quick Ratio of 1.61. This is a normal value and indicates that VAL is financially healthy and should not expect problems in meeting its short term obligations.
VAL has a Quick ratio of 1.61. This is in the better half of the industry: VAL outperforms 60.34% of its industry peers.
Industry RankSector Rank
Current Ratio 1.61
Quick Ratio 1.61
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 1B 2B 3B

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6

3. Growth

3.1 Past

VAL shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 402.60%, which is quite impressive.
VAL shows a strong growth in Revenue. In the last year, the Revenue has grown by 30.45%.
VAL shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 0.91% yearly.
EPS 1Y (TTM)402.6%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%417.65%
Revenue 1Y (TTM)30.45%
Revenue growth 3Y7.73%
Revenue growth 5Y0.91%
Sales Q2Q%41.31%

3.2 Future

Based on estimates for the next years, VAL will show a very strong growth in Earnings Per Share. The EPS will grow by 109.85% on average per year.
The Revenue is expected to grow by 15.81% on average over the next years. This is quite good.
EPS Next Y329.32%
EPS Next 2Y129.99%
EPS Next 3Y109.85%
EPS Next 5YN/A
Revenue Next Year31.91%
Revenue Next 2Y15.65%
Revenue Next 3Y15.81%
Revenue Next 5YN/A

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.
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 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 0 10 -10 20 -20

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6

4. Valuation

4.1 Price/Earnings Ratio

VAL is valuated correctly with a Price/Earnings ratio of 12.60.
Based on the Price/Earnings ratio, VAL is valued a bit cheaper than the industry average as 74.14% of the companies are valued more expensively.
VAL's Price/Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 28.51.
VAL is valuated reasonably with a Price/Forward Earnings ratio of 9.22.
Based on the Price/Forward Earnings ratio, VAL is valued cheaply inside the industry as 91.38% of the companies are valued more expensively.
Compared to an average S&P500 Price/Forward Earnings ratio of 93.88, VAL is valued rather cheaply.
Industry RankSector Rank
PE 12.6
Fwd PE 9.22
VAL Price Earnings VS Forward Price EarningsVAL Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 20 40 60 80

4.2 Price Multiples

Based on the Enterprise Value to EBITDA ratio, VAL is valued a bit more expensive than the industry average as 75.86% of the companies are valued more cheaply.
Industry RankSector Rank
P/FCF N/A
EV/EBITDA 10.16
VAL Per share dataVAL EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 0 10 20 30

4.3 Compensation for Growth

The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
VAL's earnings are expected to grow with 109.85% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.04
PEG (5Y)N/A
EPS Next 2Y129.99%
EPS Next 3Y109.85%

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0

5. Dividend

5.1 Amount

No dividends for VAL!.
Industry RankSector Rank
Dividend Yield N/A

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VALARIS LTD

NYSE:VAL (1/30/2025, 8:04:00 PM)

After market: 48.77 0 (0%)

48.77

+1.45 (+3.06%)

Chartmill FA Rating
GICS SectorEnergy
GICS IndustryGroupEnergy
GICS IndustryEnergy Equipment & Services
Earnings (Last)10-30 2024-10-30/amc
Earnings (Next)02-19 2025-02-19/amc
Inst Owners101.61%
Inst Owner Change-0.13%
Ins Owners0.59%
Ins Owner Change16.08%
Market Cap3.47B
Analysts76.67
Price Target65.93 (35.19%)
Short Float %15.31%
Short Ratio5.98
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)84.41%
Min EPS beat(2)-16.03%
Max EPS beat(2)184.85%
EPS beat(4)3
Avg EPS beat(4)291.05%
Min EPS beat(4)-16.03%
Max EPS beat(4)589.07%
EPS beat(8)5
Avg EPS beat(8)175.63%
EPS beat(12)9
Avg EPS beat(12)297.86%
EPS beat(16)N/A
Avg EPS beat(16)N/A
Revenue beat(2)2
Avg Revenue beat(2)3.99%
Min Revenue beat(2)3.49%
Max Revenue beat(2)4.49%
Revenue beat(4)3
Avg Revenue beat(4)2.84%
Min Revenue beat(4)-0.94%
Max Revenue beat(4)4.49%
Revenue beat(8)6
Avg Revenue beat(8)1.65%
Revenue beat(12)9
Avg Revenue beat(12)2.52%
Revenue beat(16)11
Avg Revenue beat(16)-1.15%
PT rev (1m)-6.59%
PT rev (3m)-20.89%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-33.18%
EPS NY rev (1m)0%
EPS NY rev (3m)-3.72%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-7.16%
Revenue NY rev (1m)-0.04%
Revenue NY rev (3m)-0.08%
Valuation
Industry RankSector Rank
PE 12.6
Fwd PE 9.22
P/S 1.53
P/FCF N/A
P/OCF 10.59
P/B 1.64
P/tB 1.64
EV/EBITDA 10.16
EPS(TTM)3.87
EY7.94%
EPS(NY)5.29
Fwd EY10.85%
FCF(TTM)-6.73
FCFYN/A
OCF(TTM)4.6
OCFY9.44%
SpS31.81
BVpS29.74
TBVpS29.74
PEG (NY)0.04
PEG (5Y)N/A
Profitability
Industry RankSector Rank
ROA 24.81%
ROE 50.83%
ROCE 7.82%
ROIC 6.32%
ROICexc 7.06%
ROICexgc 7.06%
OM 12.59%
PM (TTM) 47.52%
GM N/A
FCFM N/A
ROA(3y)-48.76%
ROA(5y)-37.03%
ROE(3y)-122.7%
ROE(5y)-96.24%
ROIC(3y)N/A
ROIC(5y)N/A
ROICexc(3y)N/A
ROICexc(5y)N/A
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)N/A
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-Score7
Asset Turnover0.52
Health
Industry RankSector Rank
Debt/Equity 0.51
Debt/FCF N/A
Debt/EBITDA 2.7
Cap/Depr 696.98%
Cap/Sales 35.65%
Interest Coverage 250
Cash Conversion 81.77%
Profit Quality N/A
Current Ratio 1.61
Quick Ratio 1.61
Altman-Z 2.17
F-Score7
WACC8.55%
ROIC/WACC0.74
Cap/Depr(3y)313.87%
Cap/Depr(5y)199.24%
Cap/Sales(3y)18.9%
Cap/Sales(5y)14.87%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)402.6%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%417.65%
EPS Next Y329.32%
EPS Next 2Y129.99%
EPS Next 3Y109.85%
EPS Next 5YN/A
Revenue 1Y (TTM)30.45%
Revenue growth 3Y7.73%
Revenue growth 5Y0.91%
Sales Q2Q%41.31%
Revenue Next Year31.91%
Revenue Next 2Y15.65%
Revenue Next 3Y15.81%
Revenue Next 5YN/A
EBIT growth 1Y566.98%
EBIT growth 3YN/A
EBIT growth 5YN/A
EBIT Next Year1043.34%
EBIT Next 3Y176.97%
EBIT Next 5YN/A
FCF growth 1Y-123.99%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y1057.6%
OCF growth 3YN/A
OCF growth 5YN/A