VICTORIA'S SECRET & CO (VSCO) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:VSCO - US9264001028 - Common Stock
59.75 USD
-2.54 (-4.08%)
60 USD
+0.25 (+0.42%)
VSCO gets a fundamental rating of 4 out of 10. The analysis compared the fundamentals against 122 industry peers in the Specialty Retail industry. VSCO has a medium profitability rating, but doesn't score so well on its financial health evaluation. VSCO has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
- VSCO had positive earnings in the past year.
- VSCO had a positive operating cash flow in the past year.
- VSCO had positive earnings in 4 of the past 5 years.
- Each year in the past 5 years VSCO had a positive operating cash flow.
1.2 Ratios
- VSCO's Return On Assets of 3.31% is fine compared to the rest of the industry. VSCO outperforms 60.33% of its industry peers.
- VSCO has a better Return On Equity (26.03%) than 84.30% of its industry peers.
- VSCO's Return On Invested Capital of 6.85% is fine compared to the rest of the industry. VSCO outperforms 64.46% of its industry peers.
- Measured over the past 3 years, the Average Return On Invested Capital for VSCO is below the industry average of 12.24%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.31% | ||
| ROE | 26.03% | ||
| ROIC | 6.85% |
ROA(3y)4.47%
ROA(5y)5.31%
ROE(3y)47.59%
ROE(5y)77.21%
ROIC(3y)9.17%
ROIC(5y)N/A
1.3 Margins
- VSCO's Profit Margin of 2.66% is fine compared to the rest of the industry. VSCO outperforms 66.94% of its industry peers.
- VSCO's Profit Margin has declined in the last couple of years.
- With a decent Operating Margin value of 5.02%, VSCO is doing good in the industry, outperforming 66.12% of the companies in the same industry.
- In the last couple of years the Operating Margin of VSCO has declined.
- VSCO has a Gross Margin (36.40%) which is comparable to the rest of the industry.
- In the last couple of years the Gross Margin of VSCO has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 5.02% | ||
| PM (TTM) | 2.66% | ||
| GM | 36.4% |
OM growth 3Y-28.61%
OM growth 5YN/A
PM growth 3Y-34.72%
PM growth 5YN/A
GM growth 3Y-3.67%
GM growth 5Y5.76%
2. Health
2.1 Basic Checks
- VSCO has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
- Compared to 1 year ago, VSCO has more shares outstanding
- The number of shares outstanding for VSCO has been reduced compared to 5 years ago.
- The debt/assets ratio for VSCO has been reduced compared to a year ago.
2.2 Solvency
- VSCO has an Altman-Z score of 2.29. This is not the best score and indicates that VSCO is in the grey zone with still only limited risk for bankruptcy at the moment.
- VSCO has a Altman-Z score of 2.29. This is comparable to the rest of the industry: VSCO outperforms 51.24% of its industry peers.
- VSCO has a debt to FCF ratio of 4.37. This is a neutral value as VSCO would need 4.37 years to pay back of all of its debts.
- VSCO has a Debt to FCF ratio of 4.37. This is in the better half of the industry: VSCO outperforms 68.59% of its industry peers.
- A Debt/Equity ratio of 2.06 is on the high side and indicates that VSCO has dependencies on debt financing.
- VSCO's Debt to Equity ratio of 2.06 is on the low side compared to the rest of the industry. VSCO is outperformed by 67.77% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.06 | ||
| Debt/FCF | 4.37 | ||
| Altman-Z | 2.29 |
ROIC/WACC0.7
WACC9.79%
2.3 Liquidity
- VSCO has a Current Ratio of 1.30. This is a normal value and indicates that VSCO is financially healthy and should not expect problems in meeting its short term obligations.
- Looking at the Current ratio, with a value of 1.30, VSCO is in line with its industry, outperforming 51.24% of the companies in the same industry.
- VSCO has a Quick Ratio of 1.30. This is a bad value and indicates that VSCO is not financially healthy enough and could expect problems in meeting its short term obligations.
- VSCO has a Quick ratio of 0.38. This is in the lower half of the industry: VSCO underperforms 61.16% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.3 | ||
| Quick Ratio | 0.38 |
3. Growth
3.1 Past
- The Earnings Per Share has been growing slightly by 5.77% over the past year.
- VSCO shows a very negative growth in Earnings Per Share. Measured over the last years, the EPS has been decreasing by -25.48% yearly.
- VSCO shows a small growth in Revenue. In the last year, the Revenue has grown by 2.96%.
- Measured over the past years, VSCO shows a decrease in Revenue. The Revenue has been decreasing by -3.67% on average per year.
EPS 1Y (TTM)5.77%
EPS 3Y-25.48%
EPS 5YN/A
EPS Q2Q%46%
Revenue 1Y (TTM)2.96%
Revenue growth 3Y-2.8%
Revenue growth 5Y-3.67%
Sales Q2Q%9.21%
3.2 Future
- The Earnings Per Share is expected to grow by 11.81% on average over the next years. This is quite good.
- Based on estimates for the next years, VSCO will show a small growth in Revenue. The Revenue will grow by 4.09% on average per year.
EPS Next Y5.11%
EPS Next 2Y10%
EPS Next 3Y11.81%
EPS Next 5YN/A
Revenue Next Year5.7%
Revenue Next 2Y4.77%
Revenue Next 3Y4.09%
Revenue Next 5YN/A
3.3 Evolution
- When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
- When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
- The Price/Earnings ratio is 21.73, which indicates a rather expensive current valuation of VSCO.
- Based on the Price/Earnings ratio, VSCO is valued a bit cheaper than the industry average as 73.55% of the companies are valued more expensively.
- VSCO is valuated rather cheaply when we compare the Price/Earnings ratio to 27.21, which is the current average of the S&P500 Index.
- A Price/Forward Earnings ratio of 18.85 indicates a rather expensive valuation of VSCO.
- Based on the Price/Forward Earnings ratio, VSCO is valued a bit cheaper than the industry average as 66.94% of the companies are valued more expensively.
- VSCO is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 25.98, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 21.73 | ||
| Fwd PE | 18.85 |
4.2 Price Multiples
- Based on the Enterprise Value to EBITDA ratio, VSCO is valued a bit cheaper than the industry average as 62.81% of the companies are valued more expensively.
- Based on the Price/Free Cash Flow ratio, VSCO is valued a bit cheaper than 75.21% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 15.5 | ||
| EV/EBITDA | 10.3 |
4.3 Compensation for Growth
- The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates VSCO does not grow enough to justify the current Price/Earnings ratio.
- VSCO has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)4.25
PEG (5Y)N/A
EPS Next 2Y10%
EPS Next 3Y11.81%
5. Dividend
5.1 Amount
- VSCO does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0% |
VICTORIA'S SECRET & CO / VSCO FAQ
Can you provide the ChartMill fundamental rating for VICTORIA'S SECRET & CO?
ChartMill assigns a fundamental rating of 4 / 10 to VSCO.
What is the valuation status for VSCO stock?
ChartMill assigns a valuation rating of 4 / 10 to VICTORIA'S SECRET & CO (VSCO). This can be considered as Fairly Valued.
How profitable is VICTORIA'S SECRET & CO (VSCO) stock?
VICTORIA'S SECRET & CO (VSCO) has a profitability rating of 6 / 10.
How financially healthy is VICTORIA'S SECRET & CO?
The financial health rating of VICTORIA'S SECRET & CO (VSCO) is 3 / 10.
Can you provide the expected EPS growth for VSCO stock?
The Earnings per Share (EPS) of VICTORIA'S SECRET & CO (VSCO) is expected to grow by 5.11% in the next year.