VALVOLINE INC (VVV) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:VVV - US92047W1018 - Common Stock
33.2 USD
+0.19 (+0.58%)
33.2 USD
0 (0%)
Taking everything into account, VVV scores 5 out of 10 in our fundamental rating. VVV was compared to 122 industry peers in the Specialty Retail industry. While VVV belongs to the best of the industry regarding profitability, there are concerns on its financial health. VVV has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
- In the past year VVV was profitable.
- In the past year VVV had a positive cash flow from operations.
- VVV had positive earnings in each of the past 5 years.
- Of the past 5 years VVV 4 years had a positive operating cash flow.
1.2 Ratios
- VVV has a Return On Assets of 7.89%. This is amongst the best in the industry. VVV outperforms 81.97% of its industry peers.
- VVV's Return On Equity of 62.25% is amongst the best of the industry. VVV outperforms 96.72% of its industry peers.
- Looking at the Return On Invested Capital, with a value of 10.18%, VVV is in the better half of the industry, outperforming 75.41% of the companies in the same industry.
- The Average Return On Invested Capital over the past 3 years for VVV is in line with the industry average of 12.24%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.89% | ||
| ROE | 62.25% | ||
| ROIC | 10.18% |
ROA(3y)21.9%
ROA(5y)18.26%
ROE(3y)291.62%
ROE(5y)265.15%
ROIC(3y)11.31%
ROIC(5y)9.35%
1.3 Margins
- The Profit Margin of VVV (12.32%) is better than 93.44% of its industry peers.
- VVV's Profit Margin has declined in the last couple of years.
- The Operating Margin of VVV (18.55%) is better than 95.90% of its industry peers.
- In the last couple of years the Operating Margin of VVV has grown nicely.
- VVV has a Gross Margin (38.50%) which is comparable to the rest of the industry.
- VVV's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 18.55% | ||
| PM (TTM) | 12.32% | ||
| GM | 38.5% |
OM growth 3Y6.87%
OM growth 5Y6.08%
PM growth 3Y-28.93%
PM growth 5Y-22.32%
GM growth 3Y-0.03%
GM growth 5Y-1.44%
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.
- The number of shares outstanding for VVV has been reduced compared to 1 year ago.
- Compared to 5 years ago, VVV has less shares outstanding
- The debt/assets ratio for VVV has been reduced compared to a year ago.
2.2 Solvency
- An Altman-Z score of 2.22 indicates that VVV is not a great score, but indicates only limited risk for bankruptcy at the moment.
- VVV's Altman-Z score of 2.22 is in line compared to the rest of the industry. VVV outperforms 49.18% of its industry peers.
- VVV has a debt to FCF ratio of 34.30. This is a negative value and a sign of low solvency as VVV would need 34.30 years to pay back of all of its debts.
- VVV's Debt to FCF ratio of 34.30 is in line compared to the rest of the industry. VVV outperforms 43.44% of its industry peers.
- VVV has a Debt/Equity ratio of 3.78. This is a high value indicating a heavy dependency on external financing.
- With a Debt to Equity ratio value of 3.78, VVV is not doing good in the industry: 76.23% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 3.78 | ||
| Debt/FCF | 34.3 | ||
| Altman-Z | 2.22 |
ROIC/WACC1.12
WACC9.11%
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.
- The Current ratio of VVV (0.70) is worse than 88.52% of its industry peers.
- 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.
- Looking at the Quick ratio, with a value of 0.58, VVV is in line with its industry, outperforming 54.10% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.7 | ||
| Quick Ratio | 0.58 |
3. Growth
3.1 Past
- VVV shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 0.64%.
- The Earnings Per Share has been growing slightly by 1.32% on average over the past years.
- VVV shows a small growth in Revenue. In the last year, the Revenue has grown by 5.64%.
- Measured over the past years, VVV shows a quite strong growth in Revenue. The Revenue has been growing by 18.66% on average per year.
EPS 1Y (TTM)0.64%
EPS 3Y-9.48%
EPS 5Y1.32%
EPS Q2Q%-2.17%
Revenue 1Y (TTM)5.64%
Revenue growth 3Y11.43%
Revenue growth 5Y18.66%
Sales Q2Q%4.2%
3.2 Future
- VVV is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 16.21% yearly.
- The Revenue is expected to grow by 13.45% on average over the next years. This is quite good.
EPS Next Y6.59%
EPS Next 2Y12.57%
EPS Next 3Y16.21%
EPS Next 5YN/A
Revenue Next Year19.56%
Revenue Next 2Y14.84%
Revenue Next 3Y13.45%
Revenue Next 5YN/A
3.3 Evolution
- The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
- The estimated forward Revenue growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
4. Valuation
4.1 Price/Earnings Ratio
- A Price/Earnings ratio of 21.01 indicates a rather expensive valuation of VVV.
- Based on the Price/Earnings ratio, VVV is valued a bit cheaper than 73.77% of the companies in the same industry.
- VVV is valuated rather cheaply when we compare the Price/Earnings ratio to 28.82, which is the current average of the S&P500 Index.
- A Price/Forward Earnings ratio of 19.71 indicates a rather expensive valuation of VVV.
- Compared to the rest of the industry, the Price/Forward Earnings ratio of VVV indicates a somewhat cheap valuation: VVV is cheaper than 64.75% of the companies listed in the same industry.
- Compared to an average S&P500 Price/Forward Earnings ratio of 25.95, VVV is valued a bit cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 21.01 | ||
| Fwd PE | 19.71 |
4.2 Price Multiples
- VVV's Enterprise Value to EBITDA ratio is in line with the industry average.
- VVV's Price/Free Cash Flow ratio is in line with the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 111.1 | ||
| EV/EBITDA | 12.54 |
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 decent profitability rating of VVV may justify a higher PE ratio.
- VVV's earnings are expected to grow with 16.21% in the coming years. This may justify a more expensive valuation.
PEG (NY)3.19
PEG (5Y)15.96
EPS Next 2Y12.57%
EPS Next 3Y16.21%
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 2.15.
- Compared to the average S&P500 Dividend Yield of 1.82, VVV is paying slightly less dividend.
| 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 2Y12.57%
EPS Next 3Y16.21%
VALVOLINE INC / VVV FAQ
Can you provide the ChartMill fundamental rating for VALVOLINE INC?
ChartMill assigns a fundamental rating of 5 / 10 to VVV.
What is the valuation status of VALVOLINE INC (VVV) stock?
ChartMill assigns a valuation rating of 4 / 10 to VALVOLINE INC (VVV). This can be considered as Fairly Valued.
Can you provide the profitability details for VALVOLINE INC?
VALVOLINE INC (VVV) has a profitability rating of 7 / 10.
What is the expected EPS growth for VALVOLINE INC (VVV) stock?
The Earnings per Share (EPS) of VALVOLINE INC (VVV) is expected to grow by 6.59% in the next year.
Can you provide the dividend sustainability for VVV stock?
The dividend rating of VALVOLINE INC (VVV) is 3 / 10 and the dividend payout ratio is 0%.