VALE SA-SP ADR (VALE) Stock Fundamental Analysis
NYSE:VALE - New York Stock Exchange, Inc. - US91912E1055 - ADR - Currency: USD
We assign a fundamental rating of 5 out of 10 to VALE. VALE was compared to 154 industry peers in the Metals & Mining industry. While VALE belongs to the best of the industry regarding profitability, there are concerns on its financial health. VALE is valued quite cheap, while showing a decent growth score. This is a good combination!
1. Profitability
1.1 Basic Checks
VALE had positive earnings in the past year.
In the past year VALE had a positive cash flow from operations.
In the past 5 years VALE has always been profitable.
Each year in the past 5 years VALE had a positive operating cash flow.
1.2 Ratios
VALE has a better Return On Assets (6.57%) than 80.52% of its industry peers.
With an excellent Return On Equity value of 15.57%, VALE belongs to the best of the industry, outperforming 87.66% of the companies in the same industry.
VALE's Return On Invested Capital of 11.71% is amongst the best of the industry. VALE outperforms 89.61% of its industry peers.
VALE had an Average Return On Invested Capital over the past 3 years of 15.63%. This is above the industry average of 11.67%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.57% | ||
| ROE | 15.57% | ||
| ROIC | 11.71% |
ROA(3y)12.09%
ROA(5y)13.23%
ROE(3y)29.15%
ROE(5y)32.97%
ROIC(3y)15.63%
ROIC(5y)19.92%
1.3 Margins
VALE has a Profit Margin of 14.88%. This is amongst the best in the industry. VALE outperforms 83.12% of its industry peers.
In the last couple of years the Profit Margin of VALE has declined.
VALE has a better Operating Margin (27.55%) than 81.82% of its industry peers.
In the last couple of years the Operating Margin of VALE has declined.
VALE has a better Gross Margin (35.45%) than 77.92% of its industry peers.
VALE's Gross Margin has declined in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 27.55% | ||
| PM (TTM) | 14.88% | ||
| GM | 35.45% |
OM growth 3Y-20.55%
OM growth 5Y-6.5%
PM growth 3Y-28.12%
PM growth 5YN/A
GM growth 3Y-15.48%
GM growth 5Y-5.12%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so VALE is still creating some value.
Compared to 1 year ago, VALE has less shares outstanding
Compared to 5 years ago, VALE has less shares outstanding
VALE has a worse debt/assets ratio than last year.
2.2 Solvency
Based on the Altman-Z score of 1.70, we must say that VALE is in the distress zone and has some risk of bankruptcy.
VALE's Altman-Z score of 1.70 is on the low side compared to the rest of the industry. VALE is outperformed by 62.34% of its industry peers.
The Debt to FCF ratio of VALE is 14.20, which is on the high side as it means it would take VALE, 14.20 years of fcf income to pay off all of its debts.
VALE has a Debt to FCF ratio of 14.20. This is in the better half of the industry: VALE outperforms 62.99% of its industry peers.
VALE has a Debt/Equity ratio of 0.44. This is a healthy value indicating a solid balance between debt and equity.
The Debt to Equity ratio of VALE (0.44) is worse than 74.68% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.44 | ||
| Debt/FCF | 14.2 | ||
| Altman-Z | 1.7 |
ROIC/WACC0.92
WACC12.78%
2.3 Liquidity
A Current Ratio of 1.11 indicates that VALE should not have too much problems paying its short term obligations.
VALE has a worse Current ratio (1.11) than 82.47% of its industry peers.
VALE has a Quick Ratio of 1.11. This is a bad value and indicates that VALE is not financially healthy enough and could expect problems in meeting its short term obligations.
The Quick ratio of VALE (0.74) is worse than 81.17% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.11 | ||
| Quick Ratio | 0.74 |
3. Growth
3.1 Past
The earnings per share for VALE have decreased strongly by -23.76% in the last year.
VALE shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 5.15% yearly.
VALE shows a small growth in Revenue. In the last year, the Revenue has grown by 2.62%.
Measured over the past years, VALE shows a small growth in Revenue. The Revenue has been growing by 7.33% on average per year.
EPS 1Y (TTM)-23.76%
EPS 3Y-31.35%
EPS 5Y5.15%
EPS Q2Q%-15.38%
Revenue 1Y (TTM)2.62%
Revenue growth 3Y-11.13%
Revenue growth 5Y7.33%
Sales Q2Q%-4.02%
3.2 Future
Based on estimates for the next years, VALE will show a quite strong growth in Earnings Per Share. The EPS will grow by 8.38% on average per year.
The Revenue is expected to grow by 0.48% on average over the next years.
EPS Next Y29.79%
EPS Next 2Y13.8%
EPS Next 3Y8.38%
EPS Next 5YN/A
Revenue Next Year-0.47%
Revenue Next 2Y1.63%
Revenue Next 3Y2.24%
Revenue Next 5Y0.48%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
VALE is valuated cheaply with a Price/Earnings ratio of 7.12.
VALE's Price/Earnings ratio is rather cheap when compared to the industry. VALE is cheaper than 99.35% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 27.21, VALE is valued rather cheaply.
VALE is valuated cheaply with a Price/Forward Earnings ratio of 5.27.
94.16% of the companies in the same industry are more expensive than VALE, based on the Price/Forward Earnings ratio.
The average S&P500 Price/Forward Earnings ratio is at 21.70. VALE is valued rather cheaply when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 7.12 | ||
| Fwd PE | 5.27 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, VALE is valued cheaply inside the industry as 94.81% of the companies are valued more expensively.
72.08% of the companies in the same industry are more expensive than VALE, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 35.15 | ||
| EV/EBITDA | 3.95 |
4.3 Compensation for Growth
VALE's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
VALE has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)0.24
PEG (5Y)1.38
EPS Next 2Y13.8%
EPS Next 3Y8.38%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 1.56%, VALE has a reasonable but not impressive dividend return.
VALE's Dividend Yield is a higher than the industry average which is at 2.98.
Compared to the average S&P500 Dividend Yield of 2.42, VALE is paying slightly less dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.56% |
5.2 History
The dividend of VALE is nicely growing with an annual growth rate of 104.30%!
VALE has been paying a dividend for at least 10 years, so it has a reliable track record.
Dividend Growth(5Y)104.3%
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
VALE pays out 64.54% of its income as dividend. This is not a sustainable payout ratio.
The dividend of VALE is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP64.54%
EPS Next 2Y13.8%
EPS Next 3Y8.38%
9.82
+0.11 (+1.13%)
Chartmill FA Rating
GICS SectorMaterials
GICS IndustryGroupMaterials
GICS IndustryMetals & Mining
Earnings (Last)
Earnings (Next)
Inst Owners42.73%
Inst Owner Change12.92%
Ins OwnersN/A
Ins Owner ChangeN/A
Market Cap41.92B
Analysts76
Price Target14.34 (46.03%)
Short Float %1.8%
Short Ratio2.08
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.56% |
Yearly Dividend0.88
Dividend Growth(5Y)104.3%
DP64.54%
Div Incr Years0
Div Non Decr Years0
Ex-Date
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-73.63%
Min EPS beat(2)-135.22%
Max EPS beat(2)-12.03%
EPS beat(4)2
Avg EPS beat(4)-22.11%
Min EPS beat(4)-135.22%
Max EPS beat(4)43.12%
EPS beat(8)3
Avg EPS beat(8)-25.94%
EPS beat(12)6
Avg EPS beat(12)-5.12%
EPS beat(16)8
Avg EPS beat(16)-4.94%
Revenue beat(2)0
Avg Revenue beat(2)-82.2%
Min Revenue beat(2)-82.3%
Max Revenue beat(2)-82.1%
Revenue beat(4)0
Avg Revenue beat(4)-82.22%
Min Revenue beat(4)-82.4%
Max Revenue beat(4)-82.1%
Revenue beat(8)0
Avg Revenue beat(8)-82.44%
Revenue beat(12)0
Avg Revenue beat(12)-64.12%
Revenue beat(16)0
Avg Revenue beat(16)-51.23%
PT rev (1m)2.51%
PT rev (3m)2.4%
EPS NQ rev (1m)0%
EPS NQ rev (3m)152.16%
EPS NY rev (1m)0%
EPS NY rev (3m)148.27%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0.96%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-0.81%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 7.12 | ||
| Fwd PE | 5.27 | ||
| P/S | 1.09 | ||
| P/FCF | 35.15 | ||
| P/OCF | 5.47 | ||
| P/B | 1.14 | ||
| P/tB | 1.6 | ||
| EV/EBITDA | 3.95 |
EPS(TTM)1.38
EY14.05%
EPS(NY)1.86
Fwd EY18.99%
FCF(TTM)0.28
FCFY2.84%
OCF(TTM)1.8
OCFY18.28%
SpS9.02
BVpS8.62
TBVpS6.12
PEG (NY)0.24
PEG (5Y)1.38
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.57% | ||
| ROE | 15.57% | ||
| ROCE | 14.46% | ||
| ROIC | 11.71% | ||
| ROICexc | 12.41% | ||
| ROICexgc | 14.67% | ||
| OM | 27.55% | ||
| PM (TTM) | 14.88% | ||
| GM | 35.45% | ||
| FCFM | 3.1% |
ROA(3y)12.09%
ROA(5y)13.23%
ROE(3y)29.15%
ROE(5y)32.97%
ROIC(3y)15.63%
ROIC(5y)19.92%
ROICexc(3y)16.65%
ROICexc(5y)22.69%
ROICexgc(3y)19.73%
ROICexgc(5y)26.7%
ROCE(3y)19.31%
ROCE(5y)24.6%
ROICexcg growth 3Y-31.02%
ROICexcg growth 5Y-4.69%
ROICexc growth 3Y-31.7%
ROICexc growth 5Y-5.74%
OM growth 3Y-20.55%
OM growth 5Y-6.5%
PM growth 3Y-28.12%
PM growth 5YN/A
GM growth 3Y-15.48%
GM growth 5Y-5.12%
F-Score4
Asset Turnover0.44
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.44 | ||
| Debt/FCF | 14.2 | ||
| Debt/EBITDA | 1.17 | ||
| Cap/Depr | 208.03% | ||
| Cap/Sales | 16.81% | ||
| Interest Coverage | 8.98 | ||
| Cash Conversion | 55.86% | ||
| Profit Quality | 20.82% | ||
| Current Ratio | 1.11 | ||
| Quick Ratio | 0.74 | ||
| Altman-Z | 1.7 |
F-Score4
WACC12.78%
ROIC/WACC0.92
Cap/Depr(3y)192.28%
Cap/Depr(5y)174.88%
Cap/Sales(3y)14.54%
Cap/Sales(5y)12.69%
Profit Quality(3y)56.79%
Profit Quality(5y)92.18%
High Growth Momentum
Growth
EPS 1Y (TTM)-23.76%
EPS 3Y-31.35%
EPS 5Y5.15%
EPS Q2Q%-15.38%
EPS Next Y29.79%
EPS Next 2Y13.8%
EPS Next 3Y8.38%
EPS Next 5YN/A
Revenue 1Y (TTM)2.62%
Revenue growth 3Y-11.13%
Revenue growth 5Y7.33%
Sales Q2Q%-4.02%
Revenue Next Year-0.47%
Revenue Next 2Y1.63%
Revenue Next 3Y2.24%
Revenue Next 5Y0.48%
EBIT growth 1Y-21.4%
EBIT growth 3Y-29.39%
EBIT growth 5Y0.36%
EBIT Next Year21.93%
EBIT Next 3Y9.54%
EBIT Next 5Y4.23%
FCF growth 1Y-81.45%
FCF growth 3Y-48.33%
FCF growth 5Y-14.71%
OCF growth 1Y-33.59%
OCF growth 3Y-28.4%
OCF growth 5Y1.2%