VALVOLINE INC (VVV) Stock Fundamental Analysis
NYSE:VVV - New York Stock Exchange, Inc. - US92047W1018 - Common Stock - Currency: USD
VVV gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 120 industry peers in the Specialty Retail industry. VVV scores excellent on profitability, but there are concerns on its financial health. VVV has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
In the past year VVV was profitable.
VVV had a positive operating cash flow in the past year.
Each year in the past 5 years VVV has been profitable.
VVV had a positive operating cash flow in 4 of the past 5 years.
1.2 Ratios
The Return On Assets of VVV (11.54%) is better than 88.03% of its industry peers.
With an excellent Return On Equity value of 118.02%, VVV belongs to the best of the industry, outperforming 98.29% of the companies in the same industry.
VVV has a better Return On Invested Capital (12.64%) than 81.20% of its industry peers.
VVV had an Average Return On Invested Capital over the past 3 years of 9.44%. This is below the industry average of 12.30%.
The last Return On Invested Capital (12.64%) for VVV is above the 3 year average (9.44%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 11.54% | ||
| ROE | 118.02% | ||
| ROIC | 12.64% |
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
VVV's Profit Margin of 16.34% is amongst the best of the industry. VVV outperforms 99.15% of its industry peers.
In the last couple of years the Profit Margin of VVV has grown nicely.
VVV has a Operating Margin of 19.49%. This is amongst the best in the industry. VVV outperforms 97.44% of its industry peers.
VVV's Operating Margin has improved in the last couple of years.
The Gross Margin of VVV (38.37%) is comparable to the rest of the industry.
VVV's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 19.49% | ||
| PM (TTM) | 16.34% | ||
| GM | 38.37% |
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
VVV has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it 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.
Compared to 1 year ago, VVV has an improved debt to assets ratio.
2.2 Solvency
An Altman-Z score of 2.58 indicates that VVV is not a great score, but indicates only limited risk for bankruptcy at the moment.
The Altman-Z score of VVV (2.58) is comparable to the rest of the industry.
The Debt to FCF ratio of VVV is 20.38, which is on the high side as it means it would take VVV, 20.38 years of fcf income to pay off all of its debts.
With a Debt to FCF ratio value of 20.38, VVV perfoms like the industry average, outperforming 45.30% of the companies in the same industry.
A Debt/Equity ratio of 4.39 is on the high side and indicates that VVV has dependencies on debt financing.
Looking at the Debt to Equity ratio, with a value of 4.39, VVV is doing worse than 79.49% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 4.39 | ||
| Debt/FCF | 20.38 | ||
| Altman-Z | 2.58 |
ROIC/WACC1.28
WACC9.87%
2.3 Liquidity
VVV has a Current Ratio of 0.70. This is a bad value and indicates that VVV is not financially healthy enough and could expect problems in meeting its short term obligations.
With a Current ratio value of 0.70, VVV is not doing good in the industry: 93.16% of the companies in the same industry are doing better.
VVV has a Quick Ratio of 0.70. 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's Quick ratio of 0.58 is in line compared to the rest of the industry. VVV outperforms 59.83% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.7 | ||
| Quick Ratio | 0.58 |
3. Growth
3.1 Past
VVV shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 19.40%, which is quite good.
VVV shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 2.47% yearly.
VVV shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 11.85%.
Measured over the past years, VVV shows a decrease in Revenue. The Revenue has been decreasing by -7.49% on average per year.
EPS 1Y (TTM)19.4%
EPS 3Y-6.49%
EPS 5Y2.47%
EPS Q2Q%10.34%
Revenue 1Y (TTM)11.85%
Revenue growth 3Y16%
Revenue growth 5Y-7.49%
Sales Q2Q%10.95%
3.2 Future
Based on estimates for the next years, VVV will show a small growth in Earnings Per Share. The EPS will grow by 7.58% on average per year.
The Revenue is expected to grow by 3.98% on average over the next years.
EPS Next Y4.69%
EPS Next 2Y11.64%
EPS Next 3Y7.58%
EPS Next 5YN/A
Revenue Next Year5.82%
Revenue Next 2Y8.97%
Revenue Next 3Y3.98%
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.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
VVV is valuated rather expensively with a Price/Earnings ratio of 22.78.
Based on the Price/Earnings ratio, VVV is valued a bit cheaper than 61.54% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 29.63, VVV is valued a bit cheaper.
VVV is valuated rather expensively with a Price/Forward Earnings ratio of 18.63.
VVV's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. VVV is cheaper than 63.25% of the companies in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 22.68. VVV is around the same levels.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.78 | ||
| Fwd PE | 18.63 |
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 | 91.38 | ||
| EV/EBITDA | 13.38 |
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.
The excellent profitability rating of VVV may justify a higher PE ratio.
PEG (NY)4.85
PEG (5Y)9.24
EPS Next 2Y11.64%
EPS Next 3Y7.58%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 1.43%, VVV has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 4.31, VVV pays a bit more dividend than its industry peers.
VVV's Dividend Yield is slightly below the S&P500 average, which is at 2.27.
| 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 2Y11.64%
EPS Next 3Y7.58%
36.45
-1.47 (-3.88%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Discretionary Distribution & Retail
GICS IndustrySpecialty Retail
Earnings (Last)
Earnings (Next)
Inst Owners101.71%
Inst Owner Change-2.46%
Ins Owners0.26%
Ins Owner Change7.1%
Market Cap4.63B
Analysts76.84
Price Target45.26 (24.17%)
Short Float %4.49%
Short Ratio3.48
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)2
Avg EPS beat(2)6.89%
Min EPS beat(2)6.05%
Max EPS beat(2)7.74%
EPS beat(4)3
Avg EPS beat(4)3.1%
Min EPS beat(4)-6.2%
Max EPS beat(4)7.74%
EPS beat(8)4
Avg EPS beat(8)0.86%
EPS beat(12)6
Avg EPS beat(12)-0.93%
EPS beat(16)10
Avg EPS beat(16)2.7%
Revenue beat(2)1
Avg Revenue beat(2)1.1%
Min Revenue beat(2)-0.36%
Max Revenue beat(2)2.56%
Revenue beat(4)1
Avg Revenue beat(4)-0.27%
Min Revenue beat(4)-1.88%
Max Revenue beat(4)2.56%
Revenue beat(8)2
Avg Revenue beat(8)-0.48%
Revenue beat(12)2
Avg Revenue beat(12)-16.39%
Revenue beat(16)4
Avg Revenue beat(16)-30.26%
PT rev (1m)-1.41%
PT rev (3m)-5.4%
EPS NQ rev (1m)-1.79%
EPS NQ rev (3m)-16.23%
EPS NY rev (1m)0.6%
EPS NY rev (3m)-10.15%
Revenue NQ rev (1m)-0.37%
Revenue NQ rev (3m)-9.11%
Revenue NY rev (1m)0.12%
Revenue NY rev (3m)-6.04%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.78 | ||
| Fwd PE | 18.63 | ||
| P/S | 2.79 | ||
| P/FCF | 91.38 | ||
| P/OCF | 16.18 | ||
| P/B | 20.16 | ||
| P/tB | N/A | ||
| EV/EBITDA | 13.38 |
EPS(TTM)1.6
EY4.39%
EPS(NY)1.96
Fwd EY5.37%
FCF(TTM)0.4
FCFY1.09%
OCF(TTM)2.25
OCFY6.18%
SpS13.06
BVpS1.81
TBVpS-3.62
PEG (NY)4.85
PEG (5Y)9.24
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 11.54% | ||
| ROE | 118.02% | ||
| ROCE | 15.81% | ||
| ROIC | 12.64% | ||
| ROICexc | 13.03% | ||
| ROICexgc | 19.95% | ||
| OM | 19.49% | ||
| PM (TTM) | 16.34% | ||
| GM | 38.37% | ||
| FCFM | 3.05% |
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 Turnover0.71
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 4.39 | ||
| Debt/FCF | 20.38 | ||
| Debt/EBITDA | 2.33 | ||
| Cap/Depr | 215.65% | ||
| Cap/Sales | 14.2% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 66.17% | ||
| Profit Quality | 18.69% | ||
| Current Ratio | 0.7 | ||
| Quick Ratio | 0.58 | ||
| Altman-Z | 2.58 |
F-Score7
WACC9.87%
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)19.4%
EPS 3Y-6.49%
EPS 5Y2.47%
EPS Q2Q%10.34%
EPS Next Y4.69%
EPS Next 2Y11.64%
EPS Next 3Y7.58%
EPS Next 5YN/A
Revenue 1Y (TTM)11.85%
Revenue growth 3Y16%
Revenue growth 5Y-7.49%
Sales Q2Q%10.95%
Revenue Next Year5.82%
Revenue Next 2Y8.97%
Revenue Next 3Y3.98%
Revenue Next 5YN/A
EBIT growth 1Y12.52%
EBIT growth 3Y14.61%
EBIT growth 5Y-3.86%
EBIT Next Year37.95%
EBIT Next 3Y14.77%
EBIT Next 5YN/A
FCF growth 1Y-52.44%
FCF growth 3Y-46.11%
FCF growth 5Y-28.45%
OCF growth 1Y17.62%
OCF growth 3Y-13.1%
OCF growth 5Y-3.99%