VELOCITY FINANCIAL INC (VEL) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:VEL - US92262D1019 - Common Stock
18.85 USD
-0.12 (-0.63%)
18.85 USD
0 (0%)
Taking everything into account, VEL scores 5 out of 10 in our fundamental rating. VEL was compared to 97 industry peers in the Financial Services industry. VEL has an excellent profitability rating, but there are concerns on its financial health. VEL is evaluated to be cheap and growing strongly. This does not happen too often!
1. Profitability
1.1 Basic Checks
VEL had positive earnings in the past year.
In the past year VEL had a positive cash flow from operations.
Of the past 5 years VEL 4 years were profitable.
In the past 5 years VEL always reported a positive cash flow from operatings.
1.2 Ratios
VEL has a Return On Assets (1.29%) which is in line with its industry peers.
Looking at the Return On Equity, with a value of 14.15%, VEL is in the better half of the industry, outperforming 73.47% of the companies in the same industry.
VEL has a Return On Invested Capital (4.05%) which is in line with its industry peers.
VEL had an Average Return On Invested Capital over the past 3 years of 4.55%. This is below the industry average of 8.44%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.29% | ||
| ROE | 14.15% | ||
| ROIC | 4.05% |
ROA(3y)1.08%
ROA(5y)0.5%
ROE(3y)11.12%
ROE(5y)5.87%
ROIC(3y)4.55%
ROIC(5y)4.48%
1.3 Margins
VEL's Profit Margin of 20.70% is amongst the best of the industry. VEL outperforms 80.61% of its industry peers.
VEL's Profit Margin has improved in the last couple of years.
With an excellent Operating Margin value of 87.86%, VEL belongs to the best of the industry, outperforming 100.00% of the companies in the same industry.
VEL's Operating Margin has improved in the last couple of years.
Looking at the Gross Margin, with a value of 86.20%, VEL belongs to the top of the industry, outperforming 89.80% of the companies in the same industry.
In the last couple of years the Gross Margin of VEL has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 87.86% | ||
| PM (TTM) | 20.7% | ||
| GM | 86.2% |
OM growth 3Y2.96%
OM growth 5Y2.4%
PM growth 3Y14.34%
PM growth 5Y8.7%
GM growth 3Y-2.01%
GM growth 5Y-1.17%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so VEL is destroying value.
The number of shares outstanding for VEL has been increased compared to 1 year ago.
VEL has more shares outstanding than it did 5 years ago.
Compared to 1 year ago, VEL has a worse debt to assets ratio.
2.2 Solvency
VEL has an Altman-Z score of 0.30. This is a bad value and indicates that VEL is not financially healthy and even has some risk of bankruptcy.
VEL has a Altman-Z score (0.30) which is in line with its industry peers.
VEL has a debt to FCF ratio of 110.82. This is a negative value and a sign of low solvency as VEL would need 110.82 years to pay back of all of its debts.
VEL's Debt to FCF ratio of 110.82 is on the low side compared to the rest of the industry. VEL is outperformed by 67.35% of its industry peers.
A Debt/Equity ratio of 9.70 is on the high side and indicates that VEL has dependencies on debt financing.
Looking at the Debt to Equity ratio, with a value of 9.70, VEL is doing worse than 86.73% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 9.7 | ||
| Debt/FCF | 110.82 | ||
| Altman-Z | 0.3 |
ROIC/WACC0.74
WACC5.48%
2.3 Liquidity
VEL has a Current Ratio of 0.29. This is a bad value and indicates that VEL is not financially healthy enough and could expect problems in meeting its short term obligations.
With a Current ratio value of 0.29, VEL is not doing good in the industry: 69.39% of the companies in the same industry are doing better.
A Quick Ratio of 0.29 indicates that VEL may have some problems paying its short term obligations.
The Quick ratio of VEL (0.29) is worse than 69.39% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.29 | ||
| Quick Ratio | 0.29 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 35.98% over the past year.
Measured over the past years, VEL shows a quite strong growth in Earnings Per Share. The EPS has been growing by 15.62% on average per year.
VEL shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 11.61%.
VEL shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 20.82% yearly.
EPS 1Y (TTM)35.98%
EPS 3Y27.91%
EPS 5Y15.62%
EPS Q2Q%46.81%
Revenue 1Y (TTM)11.61%
Revenue growth 3Y29.96%
Revenue growth 5Y20.82%
Sales Q2Q%54.24%
3.2 Future
Based on estimates for the next years, VEL will show a quite strong growth in Earnings Per Share. The EPS will grow by 11.68% on average per year.
Based on estimates for the next years, VEL will show a quite strong growth in Revenue. The Revenue will grow by 16.85% on average per year.
EPS Next Y27.37%
EPS Next 2Y13.01%
EPS Next 3Y11.68%
EPS Next 5YN/A
Revenue Next Year5.29%
Revenue Next 2Y15.78%
Revenue Next 3Y16.85%
Revenue Next 5YN/A
3.3 Evolution
The estimated forward EPS growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 7.33, the valuation of VEL can be described as very cheap.
82.65% of the companies in the same industry are more expensive than VEL, based on the Price/Earnings ratio.
Compared to an average S&P500 Price/Earnings ratio of 26.49, VEL is valued rather cheaply.
With a Price/Forward Earnings ratio of 7.27, the valuation of VEL can be described as very cheap.
Compared to the rest of the industry, the Price/Forward Earnings ratio of VEL indicates a somewhat cheap valuation: VEL is cheaper than 72.45% of the companies listed in the same industry.
VEL's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 23.69.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 7.33 | ||
| Fwd PE | 7.27 |
4.2 Price Multiples
VEL's Enterprise Value to EBITDA is on the same level as the industry average.
VEL's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. VEL is cheaper than 68.37% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 13.21 | ||
| EV/EBITDA | 16.97 |
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.
The decent profitability rating of VEL may justify a higher PE ratio.
PEG (NY)0.27
PEG (5Y)0.47
EPS Next 2Y13.01%
EPS Next 3Y11.68%
5. Dividend
5.1 Amount
No dividends for VEL!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
18.85
-0.12 (-0.63%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupFinancial Services
GICS IndustryFinancial Services
Earnings (Last)
Earnings (Next)
Inst Owners62.3%
Inst Owner Change0.73%
Ins Owners2.87%
Ins Owner Change0.02%
Market Cap733.26M
Revenue(TTM)433.35M
Net Income(TTM)89.72M
Analysts77.14
Price Target22.1 (17.24%)
Short Float %1.42%
Short Ratio5.11
Dividend
| Industry Rank | Sector 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)2
Avg EPS beat(2)24.22%
Min EPS beat(2)12.92%
Max EPS beat(2)35.52%
EPS beat(4)4
Avg EPS beat(4)18.9%
Min EPS beat(4)4.06%
Max EPS beat(4)35.52%
EPS beat(8)7
Avg EPS beat(8)16.55%
EPS beat(12)10
Avg EPS beat(12)12.95%
EPS beat(16)13
Avg EPS beat(16)13.53%
Revenue beat(2)2
Avg Revenue beat(2)103.33%
Min Revenue beat(2)95.7%
Max Revenue beat(2)110.96%
Revenue beat(4)3
Avg Revenue beat(4)48.54%
Min Revenue beat(4)-40.39%
Max Revenue beat(4)110.96%
Revenue beat(8)7
Avg Revenue beat(8)28.83%
Revenue beat(12)11
Avg Revenue beat(12)34.35%
Revenue beat(16)15
Avg Revenue beat(16)56.62%
PT rev (1m)1.56%
PT rev (3m)1.56%
EPS NQ rev (1m)8.94%
EPS NQ rev (3m)7.2%
EPS NY rev (1m)2.4%
EPS NY rev (3m)8.94%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0%
Revenue NY rev (1m)1.69%
Revenue NY rev (3m)1.69%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 7.33 | ||
| Fwd PE | 7.27 | ||
| P/S | 1.69 | ||
| P/FCF | 13.21 | ||
| P/OCF | 13.11 | ||
| P/B | 1.16 | ||
| P/tB | 1.17 | ||
| EV/EBITDA | 16.97 |
EPS(TTM)2.57
EY13.63%
EPS(NY)2.59
Fwd EY13.75%
FCF(TTM)1.43
FCFY7.57%
OCF(TTM)1.44
OCFY7.63%
SpS11.14
BVpS16.3
TBVpS16.13
PEG (NY)0.27
PEG (5Y)0.47
Graham Number30.71
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.29% | ||
| ROE | 14.15% | ||
| ROCE | 5.9% | ||
| ROIC | 4.05% | ||
| ROICexc | 4.11% | ||
| ROICexgc | 4.2% | ||
| OM | 87.86% | ||
| PM (TTM) | 20.7% | ||
| GM | 86.2% | ||
| FCFM | 12.81% |
ROA(3y)1.08%
ROA(5y)0.5%
ROE(3y)11.12%
ROE(5y)5.87%
ROIC(3y)4.55%
ROIC(5y)4.48%
ROICexc(3y)4.6%
ROICexc(5y)4.52%
ROICexgc(3y)4.66%
ROICexgc(5y)4.58%
ROCE(3y)6.64%
ROCE(5y)6.4%
ROICexgc growth 3Y6.61%
ROICexgc growth 5Y3.27%
ROICexc growth 3Y6.46%
ROICexc growth 5Y3.05%
OM growth 3Y2.96%
OM growth 5Y2.4%
PM growth 3Y14.34%
PM growth 5Y8.7%
GM growth 3Y-2.01%
GM growth 5Y-1.17%
F-Score4
Asset Turnover0.06
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 9.7 | ||
| Debt/FCF | 110.82 | ||
| Debt/EBITDA | 16.18 | ||
| Cap/Depr | -82.23% | ||
| Cap/Sales | 0.1% | ||
| Interest Coverage | 1.2 | ||
| Cash Conversion | 14.71% | ||
| Profit Quality | 61.86% | ||
| Current Ratio | 0.29 | ||
| Quick Ratio | 0.29 | ||
| Altman-Z | 0.3 |
F-Score4
WACC5.48%
ROIC/WACC0.74
Cap/Depr(3y)327.67%
Cap/Depr(5y)228.23%
Cap/Sales(3y)0.77%
Cap/Sales(5y)0.68%
Profit Quality(3y)96.08%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)35.98%
EPS 3Y27.91%
EPS 5Y15.62%
EPS Q2Q%46.81%
EPS Next Y27.37%
EPS Next 2Y13.01%
EPS Next 3Y11.68%
EPS Next 5YN/A
Revenue 1Y (TTM)11.61%
Revenue growth 3Y29.96%
Revenue growth 5Y20.82%
Sales Q2Q%54.24%
Revenue Next Year5.29%
Revenue Next 2Y15.78%
Revenue Next 3Y16.85%
Revenue Next 5YN/A
EBIT growth 1Y12.08%
EBIT growth 3Y33.8%
EBIT growth 5Y23.72%
EBIT Next Year40.63%
EBIT Next 3YN/A
EBIT Next 5YN/A
FCF growth 1Y-11.28%
FCF growth 3Y-17.04%
FCF growth 5YN/A
OCF growth 1Y-10.79%
OCF growth 3Y-13.14%
OCF growth 5YN/A
VELOCITY FINANCIAL INC / VEL FAQ
What is the ChartMill fundamental rating of VELOCITY FINANCIAL INC (VEL) stock?
ChartMill assigns a fundamental rating of 5 / 10 to VEL.
What is the valuation status of VELOCITY FINANCIAL INC (VEL) stock?
ChartMill assigns a valuation rating of 7 / 10 to VELOCITY FINANCIAL INC (VEL). This can be considered as Undervalued.
How profitable is VELOCITY FINANCIAL INC (VEL) stock?
VELOCITY FINANCIAL INC (VEL) has a profitability rating of 7 / 10.
What is the valuation of VELOCITY FINANCIAL INC based on its PE and PB ratios?
The Price/Earnings (PE) ratio for VELOCITY FINANCIAL INC (VEL) is 7.33 and the Price/Book (PB) ratio is 1.16.
What is the financial health of VELOCITY FINANCIAL INC (VEL) stock?
The financial health rating of VELOCITY FINANCIAL INC (VEL) is 0 / 10.