VELOCITY FINANCIAL INC (VEL) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:VEL - US92262D1019 - Common Stock
19.63 USD
+0.04 (+0.2%)
Overall VEL gets a fundamental rating of 5 out of 10. We evaluated VEL against 97 industry peers in the Financial Services industry. VEL scores excellent on profitability, but there are concerns on its financial health. An interesting combination arises when we look at growth and value: VEL is growing strongly while it also seems undervalued.
1. Profitability
1.1 Basic Checks
In the past year VEL was profitable.
In the past year VEL had a positive cash flow from operations.
Of the past 5 years VEL 4 years were profitable.
Each year in the past 5 years VEL had a positive operating cash flow.
1.2 Ratios
VEL has a Return On Assets (1.29%) which is comparable to the rest of the industry.
The Return On Equity of VEL (14.15%) is better than 73.20% of its industry peers.
The Return On Invested Capital of VEL (4.05%) is comparable to the rest of the industry.
The Average Return On Invested Capital over the past 3 years for VEL 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 has a Profit Margin of 20.70%. This is amongst the best in the industry. VEL outperforms 80.41% of its industry peers.
In the last couple of years the Profit Margin of VEL has grown nicely.
Looking at the Operating Margin, with a value of 87.86%, VEL belongs to the top 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.
VEL's Gross Margin of 86.20% is amongst the best of the industry. VEL outperforms 89.69% of its industry peers.
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.
Compared to 1 year ago, VEL has more shares outstanding
VEL has more shares outstanding than it did 5 years ago.
VEL has a worse debt/assets ratio than last year.
2.2 Solvency
VEL has an Altman-Z score of 0.31. This is a bad value and indicates that VEL is not financially healthy and even has some risk of bankruptcy.
The Altman-Z score of VEL (0.31) is comparable to the rest of the industry.
The Debt to FCF ratio of VEL is 110.82, which is on the high side as it means it would take VEL, 110.82 years of fcf income to pay off all of its debts.
The Debt to FCF ratio of VEL (110.82) is worse than 67.01% of its industry peers.
VEL has a Debt/Equity ratio of 9.70. This is a high value indicating a heavy dependency on external financing.
With a Debt to Equity ratio value of 9.70, VEL is not doing good in the industry: 86.60% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 9.7 | ||
| Debt/FCF | 110.82 | ||
| Altman-Z | 0.31 |
ROIC/WACC0.75
WACC5.41%
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.
Looking at the Current ratio, with a value of 0.29, VEL is doing worse than 69.07% of the companies in the same industry.
A Quick Ratio of 0.29 indicates that VEL may have some problems paying its short term obligations.
VEL has a worse Quick ratio (0.29) than 69.07% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.29 | ||
| Quick Ratio | 0.29 |
3. Growth
3.1 Past
VEL shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 35.98%, which is quite impressive.
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%.
The Revenue has been growing by 20.82% on average over the past years. This is a very strong growth!
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.
VEL is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 16.85% yearly.
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
VEL is valuated cheaply with a Price/Earnings ratio of 7.64.
Compared to the rest of the industry, the Price/Earnings ratio of VEL indicates a rather cheap valuation: VEL is cheaper than 82.47% of the companies listed in the same industry.
The average S&P500 Price/Earnings ratio is at 26.56. VEL is valued rather cheaply when compared to this.
A Price/Forward Earnings ratio of 7.57 indicates a rather cheap valuation of VEL.
Based on the Price/Forward Earnings ratio, VEL is valued a bit cheaper than the industry average as 73.20% of the companies are valued more expensively.
When comparing the Price/Forward Earnings ratio of VEL to the average of the S&P500 Index (23.79), we can say VEL is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 7.64 | ||
| Fwd PE | 7.57 |
4.2 Price Multiples
The rest of the industry has a similar Enterprise Value to EBITDA ratio as VEL.
Based on the Price/Free Cash Flow ratio, VEL is valued a bit cheaper than the industry average as 67.01% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 13.76 | ||
| EV/EBITDA | 17.05 |
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.
VEL has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)0.28
PEG (5Y)0.49
EPS Next 2Y13.01%
EPS Next 3Y11.68%
5. Dividend
5.1 Amount
VEL does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0% |
NYSE:VEL (12/15/2025, 12:17:02 PM)
19.63
+0.04 (+0.2%)
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 Cap763.61M
Revenue(TTM)433.35M
Net Income(TTM)89.72M
Analysts77.14
Price Target22.1 (12.58%)
Short Float %1.42%
Short Ratio5.11
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0% |
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 | 7.64 | ||
| Fwd PE | 7.57 | ||
| P/S | 1.76 | ||
| P/FCF | 13.76 | ||
| P/OCF | 13.65 | ||
| P/B | 1.2 | ||
| P/tB | 1.22 | ||
| EV/EBITDA | 17.05 |
EPS(TTM)2.57
EY13.09%
EPS(NY)2.59
Fwd EY13.21%
FCF(TTM)1.43
FCFY7.27%
OCF(TTM)1.44
OCFY7.32%
SpS11.14
BVpS16.3
TBVpS16.13
PEG (NY)0.28
PEG (5Y)0.49
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 | 0.31 |
F-Score4
WACC5.41%
ROIC/WACC0.75
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 8 / 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 7.64 and the Price/Book (PB) ratio is 1.2.
What is the financial health of VELOCITY FINANCIAL INC (VEL) stock?
The financial health rating of VELOCITY FINANCIAL INC (VEL) is 0 / 10.