VECTOR GROUP LTD (VGR) Stock Fundamental Analysis
NYSE:VGR - New York Stock Exchange, Inc. - US92240M1080 - Common Stock - Currency: USD
We assign a fundamental rating of 5 out of 10 to VGR. VGR was compared to 8 industry peers in the Tobacco industry. VGR has an excellent profitability rating, but there are some minor concerns on its financial health. VGR has a valuation in line with the averages, but it does not seem to be growing.
1. Profitability
1.1 Basic Checks
In the past year VGR was profitable.
In the past year VGR had a positive cash flow from operations.
VGR had positive earnings in each of the past 5 years.
In the past 5 years VGR always reported a positive cash flow from operatings.
1.2 Ratios
Looking at the Return On Assets, with a value of 17.97%, VGR belongs to the top of the industry, outperforming 88.89% of the companies in the same industry.
VGR has a better Return On Invested Capital (32.14%) than 77.78% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for VGR is significantly above the industry average of 16.98%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 17.97% | ||
| ROE | N/A | ||
| ROIC | 32.14% |
ROA(3y)20.18%
ROA(5y)14.68%
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)33.49%
ROIC(5y)27.54%
1.3 Margins
With a decent Profit Margin value of 13.84%, VGR is doing good in the industry, outperforming 66.67% of the companies in the same industry.
VGR's Profit Margin has improved in the last couple of years.
With a Operating Margin value of 25.26%, VGR perfoms like the industry average, outperforming 55.56% of the companies in the same industry.
VGR's Operating Margin has improved in the last couple of years.
VGR's Gross Margin of 33.43% is in line compared to the rest of the industry. VGR outperforms 55.56% of its industry peers.
In the last couple of years the Gross Margin of VGR has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 25.26% | ||
| PM (TTM) | 13.84% | ||
| GM | 33.43% |
OM growth 3Y16.89%
OM growth 5Y15.47%
PM growth 3Y40.56%
PM growth 5Y35.62%
GM growth 3Y0.56%
GM growth 5Y0.88%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is well above the Cost of Capital (WACC), so VGR is creating value.
VGR has more shares outstanding than it did 1 year ago.
VGR has more shares outstanding than it did 5 years ago.
The debt/assets ratio for VGR has been reduced compared to a year ago.
2.2 Solvency
VGR has an Altman-Z score of 2.67. This is not the best score and indicates that VGR is in the grey zone with still only limited risk for bankruptcy at the moment.
VGR's Altman-Z score of 2.67 is on the low side compared to the rest of the industry. VGR is outperformed by 66.67% of its industry peers.
VGR has a debt to FCF ratio of 6.84. This is a slightly negative value and a sign of low solvency as VGR would need 6.84 years to pay back of all of its debts.
The Debt to FCF ratio of VGR (6.84) is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | N/A | ||
| Debt/FCF | 6.84 | ||
| Altman-Z | 2.67 |
ROIC/WACC4.22
WACC7.62%
2.3 Liquidity
VGR has a Current Ratio of 2.43. This indicates that VGR is financially healthy and has no problem in meeting its short term obligations.
With a decent Current ratio value of 2.43, VGR is doing good in the industry, outperforming 77.78% of the companies in the same industry.
VGR has a Quick Ratio of 2.06. This indicates that VGR is financially healthy and has no problem in meeting its short term obligations.
Looking at the Quick ratio, with a value of 2.06, VGR belongs to the top of the industry, outperforming 88.89% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.43 | ||
| Quick Ratio | 2.06 |
3. Growth
3.1 Past
VGR shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 15.60%, which is quite good.
The Earnings Per Share has been growing by 17.59% on average over the past years. This is quite good.
VGR shows a very negative growth in Revenue. In the last year, the Revenue has decreased by -19.98%.
VGR shows a decrease in Revenue. Measured over the last years, the Revenue has been decreasing by -5.30% yearly.
EPS 1Y (TTM)15.6%
EPS 3Y11.27%
EPS 5Y17.59%
EPS Q2Q%6.25%
Revenue 1Y (TTM)-19.98%
Revenue growth 3Y-10.74%
Revenue growth 5Y-5.3%
Sales Q2Q%1.71%
3.2 Future
VGR is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 10.80% yearly.
The Revenue is expected to decrease by -10.29% on average over the next years. This is quite bad
EPS Next Y5.32%
EPS Next 2Y6.98%
EPS Next 3Y10.8%
EPS Next 5YN/A
Revenue Next Year-15.64%
Revenue Next 2Y-7.51%
Revenue Next 3Y-10.29%
Revenue Next 5YN/A
3.3 Evolution
Although the future EPS growth is still strong, it is not able to hold up the even more excellent growth rate of 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 decreasing.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 11.90 indicates a reasonable valuation of VGR.
66.67% of the companies in the same industry are more expensive than VGR, based on the Price/Earnings ratio.
Compared to an average S&P500 Price/Earnings ratio of 28.33, VGR is valued rather cheaply.
A Price/Forward Earnings ratio of 10.56 indicates a reasonable valuation of VGR.
Based on the Price/Forward Earnings ratio, VGR is valued a bit cheaper than the industry average as 77.78% of the companies are valued more expensively.
VGR's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 21.37.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 11.9 | ||
| Fwd PE | 10.56 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of VGR indicates a somewhat cheap valuation: VGR is cheaper than 66.67% of the companies listed in the same industry.
Based on the Price/Free Cash Flow ratio, VGR is valued a bit cheaper than 66.67% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 11.74 | ||
| EV/EBITDA | 8.37 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates VGR does not grow enough to justify the current Price/Earnings ratio.
VGR has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)2.24
PEG (5Y)0.68
EPS Next 2Y6.98%
EPS Next 3Y10.8%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 5.34%, VGR is a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 4.20, VGR pays a bit more dividend than its industry peers.
VGR's Dividend Yield is rather good when compared to the S&P500 average which is at 2.51.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 5.34% |
5.2 History
The dividend of VGR decreases each year by -11.81%.
VGR has paid a dividend for at least 10 years, which is a reliable track record.
VGR has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)-11.81%
Div Incr Years0
Div Non Decr Years3
5.3 Sustainability
VGR pays out 64.32% of its income as dividend. This is not a sustainable payout ratio.
DP64.32%
EPS Next 2Y6.98%
EPS Next 3Y10.8%
14.99
+0.03 (+0.2%)
Chartmill FA Rating
GICS SectorConsumer Staples
GICS IndustryGroupFood, Beverage & Tobacco
GICS IndustryTobacco
Earnings (Last)
Earnings (Next)
Inst Owners64.19%
Inst Owner Change0%
Ins Owners0.08%
Ins Owner Change0%
Market Cap2.36B
Analysts83.33
Price Target16.32 (8.87%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 5.34% |
Yearly Dividend0.81
Dividend Growth(5Y)-11.81%
DP64.32%
Div Incr Years0
Div Non Decr Years3
Ex-DateN/A
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-0.33%
Min EPS beat(2)-12.87%
Max EPS beat(2)12.21%
EPS beat(4)2
Avg EPS beat(4)1.14%
Min EPS beat(4)-12.87%
Max EPS beat(4)14.48%
EPS beat(8)3
Avg EPS beat(8)-2.62%
EPS beat(12)3
Avg EPS beat(12)-11.57%
EPS beat(16)7
Avg EPS beat(16)6.07%
Revenue beat(2)1
Avg Revenue beat(2)-1.06%
Min Revenue beat(2)-3.58%
Max Revenue beat(2)1.47%
Revenue beat(4)1
Avg Revenue beat(4)-10.18%
Min Revenue beat(4)-38.38%
Max Revenue beat(4)1.47%
Revenue beat(8)3
Avg Revenue beat(8)-3.06%
Revenue beat(12)6
Avg Revenue beat(12)3.33%
Revenue beat(16)9
Avg Revenue beat(16)2.99%
PT rev (1m)0%
PT rev (3m)3.23%
EPS NQ rev (1m)0%
EPS NQ rev (3m)18.06%
EPS NY rev (1m)0%
EPS NY rev (3m)0.9%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0.74%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-15.69%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 11.9 | ||
| Fwd PE | 10.56 | ||
| P/S | 1.66 | ||
| P/FCF | 11.74 | ||
| P/OCF | 11.39 | ||
| P/B | N/A | ||
| P/tB | N/A | ||
| EV/EBITDA | 8.37 |
EPS(TTM)1.26
EY8.41%
EPS(NY)1.42
Fwd EY9.47%
FCF(TTM)1.28
FCFY8.52%
OCF(TTM)1.32
OCFY8.78%
SpS9.03
BVpS-4.53
TBVpS-5.22
PEG (NY)2.24
PEG (5Y)0.68
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 17.97% | ||
| ROE | N/A | ||
| ROCE | 44.08% | ||
| ROIC | 32.14% | ||
| ROICexc | 92.65% | ||
| ROICexgc | 149.57% | ||
| OM | 25.26% | ||
| PM (TTM) | 13.84% | ||
| GM | 33.43% | ||
| FCFM | 14.14% |
ROA(3y)20.18%
ROA(5y)14.68%
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)33.49%
ROIC(5y)27.54%
ROICexc(3y)63.91%
ROICexc(5y)52.39%
ROICexgc(3y)88.47%
ROICexgc(5y)77.55%
ROCE(3y)45.93%
ROCE(5y)37.78%
ROICexcg growth 3Y11.03%
ROICexcg growth 5Y-15.8%
ROICexc growth 3Y16.6%
ROICexc growth 5Y5.87%
OM growth 3Y16.89%
OM growth 5Y15.47%
PM growth 3Y40.56%
PM growth 5Y35.62%
GM growth 3Y0.56%
GM growth 5Y0.88%
F-Score6
Asset Turnover1.3
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | N/A | ||
| Debt/FCF | 6.84 | ||
| Debt/EBITDA | 3.76 | ||
| Cap/Depr | 90.77% | ||
| Cap/Sales | 0.43% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 56.62% | ||
| Profit Quality | 102.18% | ||
| Current Ratio | 2.43 | ||
| Quick Ratio | 2.06 | ||
| Altman-Z | 2.67 |
F-Score6
WACC7.62%
ROIC/WACC4.22
Cap/Depr(3y)124.24%
Cap/Depr(5y)110.33%
Cap/Sales(3y)0.85%
Cap/Sales(5y)0.83%
Profit Quality(3y)112.11%
Profit Quality(5y)146.38%
High Growth Momentum
Growth
EPS 1Y (TTM)15.6%
EPS 3Y11.27%
EPS 5Y17.59%
EPS Q2Q%6.25%
EPS Next Y5.32%
EPS Next 2Y6.98%
EPS Next 3Y10.8%
EPS Next 5YN/A
Revenue 1Y (TTM)-19.98%
Revenue growth 3Y-10.74%
Revenue growth 5Y-5.3%
Sales Q2Q%1.71%
Revenue Next Year-15.64%
Revenue Next 2Y-7.51%
Revenue Next 3Y-10.29%
Revenue Next 5YN/A
EBIT growth 1Y-13.04%
EBIT growth 3Y4.34%
EBIT growth 5Y9.35%
EBIT Next Year20.36%
EBIT Next 3Y10.31%
EBIT Next 5YN/A
FCF growth 1Y-13.3%
FCF growth 3Y-7.06%
FCF growth 5Y3.98%
OCF growth 1Y-15.52%
OCF growth 3Y-7.75%
OCF growth 5Y2.92%