VALVOLINE INC (VVV) Stock Fundamental Analysis
NYSE:VVV - New York Stock Exchange, Inc. - US92047W1018 - Common Stock - Currency: USD
Taking everything into account, VVV scores 5 out of 10 in our fundamental rating. VVV was compared to 121 industry peers in the Specialty Retail industry. VVV scores excellent on profitability, but there are concerns on its financial health. While showing a medium growth rate, VVV is valued expensive at the moment.
1. Profitability
1.1 Basic Checks
VVV had positive earnings in the past year.
VVV had a positive operating cash flow in the past year.
In the past 5 years VVV has always been profitable.
Of the past 5 years VVV 4 years had a positive operating cash flow.
1.2 Ratios
Looking at the Return On Assets, with a value of 10.90%, VVV belongs to the top of the industry, outperforming 85.12% of the companies in the same industry.
VVV has a Return On Equity of 107.52%. This is amongst the best in the industry. VVV outperforms 99.17% of its industry peers.
With a decent Return On Invested Capital value of 11.74%, VVV is doing good in the industry, outperforming 79.34% of the companies in the same industry.
VVV had an Average Return On Invested Capital over the past 3 years of 9.44%. This is below the industry average of 13.07%.
The last Return On Invested Capital (11.74%) for VVV is above the 3 year average (9.44%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 10.9% | ||
| ROE | 107.52% | ||
| ROIC | 11.74% |
ROA(3y)23.41%
ROA(5y)18.75%
ROE(3y)317.01%
ROE(5y)N/A
ROIC(3y)9.44%
ROIC(5y)7.69%
1.3 Margins
With an excellent Profit Margin value of 15.97%, VVV belongs to the best of the industry, outperforming 96.69% of the companies in the same industry.
VVV's Profit Margin has improved in the last couple of years.
Looking at the Operating Margin, with a value of 18.74%, VVV belongs to the top of the industry, outperforming 95.87% of the companies in the same industry.
In the last couple of years the Operating Margin of VVV has grown nicely.
The Gross Margin of VVV (38.29%) is comparable to the rest of the industry.
In the last couple of years the Gross Margin of VVV has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 18.74% | ||
| PM (TTM) | 15.97% | ||
| GM | 38.29% |
OM growth 3Y-1.2%
OM growth 5Y3.93%
PM growth 3Y-31.43%
PM growth 5Y8.46%
GM growth 3Y-2.85%
GM growth 5Y2.43%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), VVV is creating some value.
VVV has less shares outstanding than it did 1 year ago.
VVV has less shares outstanding than it did 5 years ago.
The debt/assets ratio for VVV has been reduced compared to a year ago.
2.2 Solvency
VVV has an Altman-Z score of 2.52. This is not the best score and indicates that VVV is in the grey zone with still only limited risk for bankruptcy at the moment.
The Altman-Z score of VVV (2.52) is comparable to the rest of the industry.
VVV has a debt to FCF ratio of 47.39. This is a negative value and a sign of low solvency as VVV would need 47.39 years to pay back of all of its debts.
VVV's Debt to FCF ratio of 47.39 is in line compared to the rest of the industry. VVV outperforms 47.11% of its industry peers.
VVV has a Debt/Equity ratio of 4.23. This is a high value indicating a heavy dependency on external financing.
VVV has a worse Debt to Equity ratio (4.23) than 78.51% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 4.23 | ||
| Debt/FCF | 47.39 | ||
| Altman-Z | 2.52 |
ROIC/WACC1.28
WACC9.14%
2.3 Liquidity
VVV has a Current Ratio of 0.73. This is a bad value and indicates that VVV is not financially healthy enough and could expect problems in meeting its short term obligations.
Looking at the Current ratio, with a value of 0.73, VVV is doing worse than 88.43% of the companies in the same industry.
VVV has a Quick Ratio of 0.73. This is a bad value and indicates that VVV is not financially healthy enough and could expect problems in meeting its short term obligations.
VVV has a Quick ratio (0.60) which is in line with its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.73 | ||
| Quick Ratio | 0.6 |
3. Growth
3.1 Past
VVV shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 6.08%.
The Earnings Per Share has been growing slightly by 2.47% on average over the past years.
Looking at the last year, VVV shows a quite strong growth in Revenue. The Revenue has grown by 9.56% in the last year.
VVV shows a decrease in Revenue. Measured over the last years, the Revenue has been decreasing by -7.49% yearly.
EPS 1Y (TTM)6.08%
EPS 3Y-6.49%
EPS 5Y2.47%
EPS Q2Q%-8.11%
Revenue 1Y (TTM)9.56%
Revenue growth 3Y16%
Revenue growth 5Y-7.49%
Sales Q2Q%3.73%
3.2 Future
The Earnings Per Share is expected to grow by 7.69% on average over the next years.
VVV is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 6.78% yearly.
EPS Next Y2.49%
EPS Next 2Y9.77%
EPS Next 3Y7.69%
EPS Next 5YN/A
Revenue Next Year5.76%
Revenue Next 2Y10.47%
Revenue Next 3Y6.78%
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
Based on the Price/Earnings ratio of 24.57, the valuation of VVV can be described as rather expensive.
Based on the Price/Earnings ratio, VVV is valued a bit cheaper than 63.64% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 27.30, VVV is valued at the same level.
Based on the Price/Forward Earnings ratio of 20.39, the valuation of VVV can be described as rather expensive.
The rest of the industry has a similar Price/Forward Earnings ratio as VVV.
VVV's Price/Forward Earnings ratio indicates a similar valuation than the S&P500 average which is at 21.76.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 24.57 | ||
| Fwd PE | 20.39 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of VVV is on the same level as its industry peers.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of VVV is on the same level as its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 216.03 | ||
| EV/EBITDA | 14.03 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates VVV does not grow enough to justify the current Price/Earnings ratio.
VVV has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)9.85
PEG (5Y)9.97
EPS Next 2Y9.77%
EPS Next 3Y7.69%
5. Dividend
5.1 Amount
VVV has a Yearly Dividend Yield of 1.43%.
VVV's Dividend Yield is a higher than the industry average which is at 4.99.
VVV's Dividend Yield is slightly below the S&P500 average, which is at 2.37.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.43% |
5.2 History
VVV has been paying a dividend for over 5 years, so it has already some track record.
Dividend Growth(5Y)N/A
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
DP0%
EPS Next 2Y9.77%
EPS Next 3Y7.69%
38.58
-0.47 (-1.2%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Discretionary Distribution & Retail
GICS IndustrySpecialty Retail
Earnings (Last)
Earnings (Next)
Inst Owners104.35%
Inst Owner Change0%
Ins Owners0.26%
Ins Owner Change0.53%
Market Cap4.90B
Analysts77.89
Price Target43.44 (12.6%)
Short Float %7.67%
Short Ratio5.36
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.43% |
Yearly Dividend0
Dividend Growth(5Y)N/A
DP0%
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-0.35%
Min EPS beat(2)-6.75%
Max EPS beat(2)6.05%
EPS beat(4)2
Avg EPS beat(4)0.21%
Min EPS beat(4)-6.75%
Max EPS beat(4)7.74%
EPS beat(8)4
Avg EPS beat(8)2.2%
EPS beat(12)6
Avg EPS beat(12)-1.05%
EPS beat(16)9
Avg EPS beat(16)0.81%
Revenue beat(2)1
Avg Revenue beat(2)0.55%
Min Revenue beat(2)-1.46%
Max Revenue beat(2)2.56%
Revenue beat(4)1
Avg Revenue beat(4)-0.28%
Min Revenue beat(4)-1.88%
Max Revenue beat(4)2.56%
Revenue beat(8)2
Avg Revenue beat(8)-0.55%
Revenue beat(12)2
Avg Revenue beat(12)-10.93%
Revenue beat(16)3
Avg Revenue beat(16)-30.69%
PT rev (1m)-1.16%
PT rev (3m)-3.12%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-5.25%
EPS NY rev (1m)-0.76%
EPS NY rev (3m)-2.32%
Revenue NQ rev (1m)-0.14%
Revenue NQ rev (3m)-3.29%
Revenue NY rev (1m)-0.06%
Revenue NY rev (3m)-2.04%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 24.57 | ||
| Fwd PE | 20.39 | ||
| P/S | 2.93 | ||
| P/FCF | 216.03 | ||
| P/OCF | 18.48 | ||
| P/B | 19.72 | ||
| P/tB | N/A | ||
| EV/EBITDA | 14.03 |
EPS(TTM)1.57
EY4.07%
EPS(NY)1.89
Fwd EY4.9%
FCF(TTM)0.18
FCFY0.46%
OCF(TTM)2.09
OCFY5.41%
SpS13.17
BVpS1.96
TBVpS-3.48
PEG (NY)9.85
PEG (5Y)9.97
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 10.9% | ||
| ROE | 107.52% | ||
| ROCE | 14.68% | ||
| ROIC | 11.74% | ||
| ROICexc | 12.09% | ||
| ROICexgc | 18.13% | ||
| OM | 18.74% | ||
| PM (TTM) | 15.97% | ||
| GM | 38.29% | ||
| FCFM | 1.36% |
ROA(3y)23.41%
ROA(5y)18.75%
ROE(3y)317.01%
ROE(5y)N/A
ROIC(3y)9.44%
ROIC(5y)7.69%
ROICexc(3y)10.86%
ROICexc(5y)8.92%
ROICexgc(3y)16.64%
ROICexgc(5y)13.28%
ROCE(3y)11.8%
ROCE(5y)9.62%
ROICexcg growth 3Y28.72%
ROICexcg growth 5Y-9.33%
ROICexc growth 3Y23.11%
ROICexc growth 5Y-9.61%
OM growth 3Y-1.2%
OM growth 5Y3.93%
PM growth 3Y-31.43%
PM growth 5Y8.46%
GM growth 3Y-2.85%
GM growth 5Y2.43%
F-Score7
Asset Turnover0.68
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 4.23 | ||
| Debt/FCF | 47.39 | ||
| Debt/EBITDA | 2.47 | ||
| Cap/Depr | 216.41% | ||
| Cap/Sales | 14.49% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 62.29% | ||
| Profit Quality | 8.49% | ||
| Current Ratio | 0.73 | ||
| Quick Ratio | 0.6 | ||
| Altman-Z | 2.52 |
F-Score7
WACC9.14%
ROIC/WACC1.28
Cap/Depr(3y)200.01%
Cap/Depr(5y)197.07%
Cap/Sales(3y)12.35%
Cap/Sales(5y)14.34%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)6.08%
EPS 3Y-6.49%
EPS 5Y2.47%
EPS Q2Q%-8.11%
EPS Next Y2.49%
EPS Next 2Y9.77%
EPS Next 3Y7.69%
EPS Next 5YN/A
Revenue 1Y (TTM)9.56%
Revenue growth 3Y16%
Revenue growth 5Y-7.49%
Sales Q2Q%3.73%
Revenue Next Year5.76%
Revenue Next 2Y10.47%
Revenue Next 3Y6.78%
Revenue Next 5YN/A
EBIT growth 1Y5.55%
EBIT growth 3Y14.61%
EBIT growth 5Y-3.86%
EBIT Next Year38.61%
EBIT Next 3Y17.36%
EBIT Next 5YN/A
FCF growth 1Y-85.25%
FCF growth 3Y-46.11%
FCF growth 5Y-28.45%
OCF growth 1Y-11.06%
OCF growth 3Y-13.1%
OCF growth 5Y-3.99%