VERRA MOBILITY CORP (VRRM) Stock Fundamental Analysis
NASDAQ:VRRM - Nasdaq - US92511U1025 - Common Stock - Currency: USD
VRRM gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 81 industry peers in the IT Services industry. While VRRM has a great profitability rating, there are some minor concerns on its financial health. VRRM has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
In the past year VRRM was profitable.
VRRM had a positive operating cash flow in the past year.
VRRM had positive earnings in 4 of the past 5 years.
Each year in the past 5 years VRRM had a positive operating cash flow.
1.2 Ratios
With a Return On Assets value of 2.11%, VRRM perfoms like the industry average, outperforming 53.09% of the companies in the same industry.
VRRM has a better Return On Equity (11.56%) than 67.90% of its industry peers.
With an excellent Return On Invested Capital value of 12.88%, VRRM belongs to the best of the industry, outperforming 81.48% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for VRRM is significantly below the industry average of 21.85%.
The 3 year average ROIC (10.27%) for VRRM is below the current ROIC(12.88%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.11% | ||
| ROE | 11.56% | ||
| ROIC | 12.88% |
ROA(3y)3.47%
ROA(5y)2.46%
ROE(3y)21.81%
ROE(5y)15.98%
ROIC(3y)10.27%
ROIC(5y)7.68%
1.3 Margins
Looking at the Profit Margin, with a value of 3.88%, VRRM is in line with its industry, outperforming 58.02% of the companies in the same industry.
VRRM's Profit Margin has been stable in the last couple of years.
With an excellent Operating Margin value of 26.45%, VRRM belongs to the best of the industry, outperforming 97.53% of the companies in the same industry.
VRRM's Operating Margin has improved in the last couple of years.
VRRM has a better Gross Margin (94.48%) than 100.00% of its industry peers.
In the last couple of years the Gross Margin of VRRM has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 26.45% | ||
| PM (TTM) | 3.88% | ||
| GM | 94.48% |
OM growth 3Y9.3%
OM growth 5Y3.04%
PM growth 3Y-21.94%
PM growth 5Y-1.26%
GM growth 3Y0.41%
GM growth 5Y-0.19%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so VRRM is still creating some value.
The number of shares outstanding for VRRM has been reduced compared to 1 year ago.
The number of shares outstanding for VRRM has been increased compared to 5 years ago.
Compared to 1 year ago, VRRM has a worse debt to assets ratio.
2.2 Solvency
An Altman-Z score of 2.81 indicates that VRRM is not a great score, but indicates only limited risk for bankruptcy at the moment.
With a Altman-Z score value of 2.81, VRRM perfoms like the industry average, outperforming 46.91% of the companies in the same industry.
VRRM has a debt to FCF ratio of 5.92. This is a neutral value as VRRM would need 5.92 years to pay back of all of its debts.
Looking at the Debt to FCF ratio, with a value of 5.92, VRRM is in line with its industry, outperforming 50.62% of the companies in the same industry.
A Debt/Equity ratio of 3.45 is on the high side and indicates that VRRM has dependencies on debt financing.
VRRM has a Debt to Equity ratio of 3.45. This is amonst the worse of the industry: VRRM underperforms 83.95% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 3.45 | ||
| Debt/FCF | 5.92 | ||
| Altman-Z | 2.81 |
ROIC/WACC1.33
WACC9.67%
2.3 Liquidity
VRRM has a Current Ratio of 2.19. This indicates that VRRM is financially healthy and has no problem in meeting its short term obligations.
VRRM's Current ratio of 2.19 is fine compared to the rest of the industry. VRRM outperforms 65.43% of its industry peers.
VRRM has a Quick Ratio of 2.10. This indicates that VRRM is financially healthy and has no problem in meeting its short term obligations.
With a decent Quick ratio value of 2.10, VRRM is doing good in the industry, outperforming 65.43% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.19 | ||
| Quick Ratio | 2.1 |
3. Growth
3.1 Past
VRRM shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 15.60%, which is quite good.
Measured over the past years, VRRM shows a very strong growth in Earnings Per Share. The EPS has been growing by 42.41% on average per year.
VRRM shows a small growth in Revenue. In the last year, the Revenue has grown by 6.90%.
The Revenue has been growing by 14.40% on average over the past years. This is quite good.
EPS 1Y (TTM)15.6%
EPS 3Y27.03%
EPS 5Y42.41%
EPS Q2Q%11.11%
Revenue 1Y (TTM)6.9%
Revenue growth 3Y16.88%
Revenue growth 5Y14.4%
Sales Q2Q%6.45%
3.2 Future
The Earnings Per Share is expected to grow by 12.27% on average over the next years. This is quite good.
VRRM is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 7.16% yearly.
EPS Next Y9.23%
EPS Next 2Y11.58%
EPS Next 3Y12.27%
EPS Next 5YN/A
Revenue Next Year5.8%
Revenue Next 2Y6.62%
Revenue Next 3Y7.16%
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.
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
Based on the Price/Earnings ratio of 20.36, the valuation of VRRM can be described as rather expensive.
66.67% of the companies in the same industry are more expensive than VRRM, based on the Price/Earnings ratio.
When comparing the Price/Earnings ratio of VRRM to the average of the S&P500 Index (27.45), we can say VRRM is valued slightly cheaper.
The Price/Forward Earnings ratio is 16.75, which indicates a correct valuation of VRRM.
Based on the Price/Forward Earnings ratio, VRRM is valued a bit cheaper than 69.14% of the companies in the same industry.
VRRM is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 21.90, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 20.36 | ||
| Fwd PE | 16.75 |
4.2 Price Multiples
66.67% of the companies in the same industry are more expensive than VRRM, based on the Enterprise Value to EBITDA ratio.
Based on the Price/Free Cash Flow ratio, VRRM is valued a bit cheaper than 61.73% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 23.44 | ||
| EV/EBITDA | 14.52 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates VRRM does not grow enough to justify the current Price/Earnings ratio.
The decent profitability rating of VRRM may justify a higher PE ratio.
A more expensive valuation may be justified as VRRM's earnings are expected to grow with 12.27% in the coming years.
PEG (NY)2.21
PEG (5Y)0.48
EPS Next 2Y11.58%
EPS Next 3Y12.27%
5. Dividend
5.1 Amount
VRRM does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
25.65
+0.12 (+0.47%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustryIT Services
Earnings (Last)
Earnings (Next)
Inst Owners103.92%
Inst Owner Change-0.32%
Ins Owners0.9%
Ins Owner Change1.71%
Market Cap4.09B
Analysts84.62
Price Target29.5 (15.01%)
Short Float %1.36%
Short Ratio1.96
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)5.66%
Min EPS beat(2)2.43%
Max EPS beat(2)8.88%
EPS beat(4)3
Avg EPS beat(4)3.24%
Min EPS beat(4)-0.63%
Max EPS beat(4)8.88%
EPS beat(8)6
Avg EPS beat(8)1.65%
EPS beat(12)9
Avg EPS beat(12)4.47%
EPS beat(16)11
Avg EPS beat(16)3.76%
Revenue beat(2)1
Avg Revenue beat(2)-0.31%
Min Revenue beat(2)-1.5%
Max Revenue beat(2)0.89%
Revenue beat(4)1
Avg Revenue beat(4)-1.03%
Min Revenue beat(4)-2.43%
Max Revenue beat(4)0.89%
Revenue beat(8)4
Avg Revenue beat(8)-0.13%
Revenue beat(12)6
Avg Revenue beat(12)0.1%
Revenue beat(16)10
Avg Revenue beat(16)1.4%
PT rev (1m)-0.57%
PT rev (3m)-1.7%
EPS NQ rev (1m)0%
EPS NQ rev (3m)0%
EPS NY rev (1m)0%
EPS NY rev (3m)-0.11%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-0.27%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-0.09%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 20.36 | ||
| Fwd PE | 16.75 | ||
| P/S | 4.58 | ||
| P/FCF | 23.44 | ||
| P/OCF | 16.21 | ||
| P/B | 13.65 | ||
| P/tB | N/A | ||
| EV/EBITDA | 14.52 |
EPS(TTM)1.26
EY4.91%
EPS(NY)1.53
Fwd EY5.97%
FCF(TTM)1.09
FCFY4.27%
OCF(TTM)1.58
OCFY6.17%
SpS5.6
BVpS1.88
TBVpS-4.1
PEG (NY)2.21
PEG (5Y)0.48
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.11% | ||
| ROE | 11.56% | ||
| ROCE | 16.3% | ||
| ROIC | 12.88% | ||
| ROICexc | 13.92% | ||
| ROICexgc | 48.3% | ||
| OM | 26.45% | ||
| PM (TTM) | 3.88% | ||
| GM | 94.48% | ||
| FCFM | 19.54% |
ROA(3y)3.47%
ROA(5y)2.46%
ROE(3y)21.81%
ROE(5y)15.98%
ROIC(3y)10.27%
ROIC(5y)7.68%
ROICexc(3y)11.02%
ROICexc(5y)8.25%
ROICexgc(3y)50.23%
ROICexgc(5y)40.02%
ROCE(3y)12.99%
ROCE(5y)9.72%
ROICexcg growth 3Y9.79%
ROICexcg growth 5Y-1.24%
ROICexc growth 3Y34.5%
ROICexc growth 5Y14.79%
OM growth 3Y9.3%
OM growth 5Y3.04%
PM growth 3Y-21.94%
PM growth 5Y-1.26%
GM growth 3Y0.41%
GM growth 5Y-0.19%
F-Score5
Asset Turnover0.54
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 3.45 | ||
| Debt/FCF | 5.92 | ||
| Debt/EBITDA | 2.99 | ||
| Cap/Depr | 71.31% | ||
| Cap/Sales | 8.72% | ||
| Interest Coverage | 3.25 | ||
| Cash Conversion | 73.07% | ||
| Profit Quality | 503.65% | ||
| Current Ratio | 2.19 | ||
| Quick Ratio | 2.1 | ||
| Altman-Z | 2.81 |
F-Score5
WACC9.67%
ROIC/WACC1.33
Cap/Depr(3y)50.29%
Cap/Depr(5y)38.63%
Cap/Sales(3y)7.2%
Cap/Sales(5y)6.46%
Profit Quality(3y)310.13%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)15.6%
EPS 3Y27.03%
EPS 5Y42.41%
EPS Q2Q%11.11%
EPS Next Y9.23%
EPS Next 2Y11.58%
EPS Next 3Y12.27%
EPS Next 5YN/A
Revenue 1Y (TTM)6.9%
Revenue growth 3Y16.88%
Revenue growth 5Y14.4%
Sales Q2Q%6.45%
Revenue Next Year5.8%
Revenue Next 2Y6.62%
Revenue Next 3Y7.16%
Revenue Next 5YN/A
EBIT growth 1Y22.3%
EBIT growth 3Y27.75%
EBIT growth 5Y17.88%
EBIT Next Year30.2%
EBIT Next 3Y15.29%
EBIT Next 5YN/A
FCF growth 1Y-1.55%
FCF growth 3Y-3.15%
FCF growth 5Y7.98%
OCF growth 1Y8.6%
OCF growth 3Y5%
OCF growth 5Y10.82%