VALVOLINE INC (VVV) Stock Fundamental Analysis
USA - NYSE:VVV - US92047W1018 - Common Stock
34.6 USD
-0.62 (-1.76%)
34.6 USD
0 (0%)
We assign a fundamental rating of 5 out of 10 to VVV. VVV was compared to 120 industry peers in the Specialty Retail industry. VVV has an excellent profitability rating, 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.
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
Looking at the Return On Assets, with a value of 10.85%, VVV belongs to the top of the industry, outperforming 85.83% of the companies in the same industry.
VVV has a Return On Equity of 88.65%. This is amongst the best in the industry. VVV outperforms 99.17% of its industry peers.
Looking at the Return On Invested Capital, with a value of 11.30%, VVV is in the better half of the industry, outperforming 78.33% 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 12.17%.
The 3 year average ROIC (9.44%) for VVV is below the current ROIC(11.30%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 10.85% | ||
| ROE | 88.65% | ||
| ROIC | 11.3% |
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
The Profit Margin of VVV (16.43%) is better than 97.50% of its industry peers.
In the last couple of years the Profit Margin of VVV has grown nicely.
The Operating Margin of VVV (18.65%) is better than 95.83% of its industry peers.
VVV's Operating Margin has improved in the last couple of years.
With a Gross Margin value of 38.49%, VVV perfoms like the industry average, outperforming 56.67% of the companies in the same industry.
VVV's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 18.65% | ||
| PM (TTM) | 16.43% | ||
| GM | 38.49% |
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 2.36. 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.
VVV has a Altman-Z score (2.36) which is in line with its industry peers.
VVV has a debt to FCF ratio of 24.05. This is a negative value and a sign of low solvency as VVV would need 24.05 years to pay back of all of its debts.
VVV has a Debt to FCF ratio (24.05) which is comparable to the rest of the industry.
VVV has a Debt/Equity ratio of 3.37. This is a high value indicating a heavy dependency on external financing.
VVV has a Debt to Equity ratio of 3.37. This is in the lower half of the industry: VVV underperforms 76.67% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 3.37 | ||
| Debt/FCF | 24.05 | ||
| Altman-Z | 2.36 |
ROIC/WACC1.23
WACC9.16%
2.3 Liquidity
A Current Ratio of 0.73 indicates that VVV may have some problems paying its short term obligations.
VVV has a Current ratio of 0.73. This is amonst the worse of the industry: VVV underperforms 88.33% of its industry peers.
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 6.00%.
Measured over the past 5 years, VVV shows a small growth in Earnings Per Share. The EPS has been growing by 2.47% on average per year.
Looking at the last year, VVV shows a small growth in Revenue. The Revenue has grown by 7.53% 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%
EPS 3Y-6.49%
EPS 5Y2.47%
EPS Q2Q%4.44%
Revenue 1Y (TTM)7.53%
Revenue growth 3Y16%
Revenue growth 5Y-7.49%
Sales Q2Q%4.18%
3.2 Future
The Earnings Per Share is expected to grow by 13.65% on average over the next years. This is quite good.
The Revenue is expected to grow by 10.75% on average over the next years. This is quite good.
EPS Next Y3.87%
EPS Next 2Y10.49%
EPS Next 3Y13.65%
EPS Next 5YN/A
Revenue Next Year5.94%
Revenue Next 2Y10.03%
Revenue Next 3Y10.75%
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.
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 21.76, which indicates a rather expensive current valuation of VVV.
Based on the Price/Earnings ratio, VVV is valued a bit cheaper than the industry average as 69.17% of the companies are valued more expensively.
VVV's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 27.31.
Based on the Price/Forward Earnings ratio of 18.05, the valuation of VVV can be described as rather expensive.
61.67% of the companies in the same industry are more expensive than VVV, based on the Price/Forward Earnings ratio.
When comparing the Price/Forward Earnings ratio of VVV to the average of the S&P500 Index (22.85), we can say VVV is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 21.76 | ||
| Fwd PE | 18.05 |
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 | 97.95 | ||
| EV/EBITDA | 12.73 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
VVV has an outstanding profitability rating, which may justify a higher PE ratio.
VVV's earnings are expected to grow with 13.65% in the coming years. This may justify a more expensive valuation.
PEG (NY)5.62
PEG (5Y)8.83
EPS Next 2Y10.49%
EPS Next 3Y13.65%
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 5.63, VVV pays a bit more dividend than its industry peers.
With a Dividend Yield of 1.43, VVV pays less dividend than the S&P500 average, which is at 2.40.
| 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 2Y10.49%
EPS Next 3Y13.65%
34.6
-0.62 (-1.76%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Discretionary Distribution & Retail
GICS IndustrySpecialty Retail
Earnings (Last)
Earnings (Next)
Inst Owners112.84%
Inst Owner Change-0.01%
Ins Owners0.27%
Ins Owner Change1.93%
Market Cap4.40B
Analysts76.84
Price Target45.6 (31.79%)
Short Float %8.76%
Short Ratio6.5
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)-1.68%
Min EPS beat(2)-6.75%
Max EPS beat(2)3.39%
EPS beat(4)3
Avg EPS beat(4)2.61%
Min EPS beat(4)-6.75%
Max EPS beat(4)7.74%
EPS beat(8)4
Avg EPS beat(8)0.42%
EPS beat(12)6
Avg EPS beat(12)-0.89%
EPS beat(16)9
Avg EPS beat(16)-0.29%
Revenue beat(2)0
Avg Revenue beat(2)-0.93%
Min Revenue beat(2)-1.46%
Max Revenue beat(2)-0.39%
Revenue beat(4)1
Avg Revenue beat(4)0.09%
Min Revenue beat(4)-1.46%
Max Revenue beat(4)2.56%
Revenue beat(8)1
Avg Revenue beat(8)-0.8%
Revenue beat(12)2
Avg Revenue beat(12)-5.43%
Revenue beat(16)2
Avg Revenue beat(16)-31.04%
PT rev (1m)1.13%
PT rev (3m)4.99%
EPS NQ rev (1m)0%
EPS NQ rev (3m)0.18%
EPS NY rev (1m)-0.16%
EPS NY rev (3m)1.44%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-0.14%
Revenue NY rev (1m)0%
Revenue NY rev (3m)0.17%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 21.76 | ||
| Fwd PE | 18.05 | ||
| P/S | 2.6 | ||
| P/FCF | 97.95 | ||
| P/OCF | 15.9 | ||
| P/B | 14.02 | ||
| P/tB | N/A | ||
| EV/EBITDA | 12.73 |
EPS(TTM)1.59
EY4.6%
EPS(NY)1.92
Fwd EY5.54%
FCF(TTM)0.35
FCFY1.02%
OCF(TTM)2.18
OCFY6.29%
SpS13.31
BVpS2.47
TBVpS-3.14
PEG (NY)5.62
PEG (5Y)8.83
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 10.85% | ||
| ROE | 88.65% | ||
| ROCE | 14.13% | ||
| ROIC | 11.3% | ||
| ROICexc | 11.65% | ||
| ROICexgc | 17.37% | ||
| OM | 18.65% | ||
| PM (TTM) | 16.43% | ||
| GM | 38.49% | ||
| FCFM | 2.65% |
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 Turnover0.66
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 3.37 | ||
| Debt/FCF | 24.05 | ||
| Debt/EBITDA | 2.45 | ||
| Cap/Depr | 200.78% | ||
| Cap/Sales | 13.69% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 64.18% | ||
| Profit Quality | 16.15% | ||
| Current Ratio | 0.73 | ||
| Quick Ratio | 0.6 | ||
| Altman-Z | 2.36 |
F-Score7
WACC9.16%
ROIC/WACC1.23
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%
EPS 3Y-6.49%
EPS 5Y2.47%
EPS Q2Q%4.44%
EPS Next Y3.87%
EPS Next 2Y10.49%
EPS Next 3Y13.65%
EPS Next 5YN/A
Revenue 1Y (TTM)7.53%
Revenue growth 3Y16%
Revenue growth 5Y-7.49%
Sales Q2Q%4.18%
Revenue Next Year5.94%
Revenue Next 2Y10.03%
Revenue Next 3Y10.75%
Revenue Next 5YN/A
EBIT growth 1Y4.33%
EBIT growth 3Y14.61%
EBIT growth 5Y-3.86%
EBIT Next Year40.69%
EBIT Next 3Y22.59%
EBIT Next 5YN/A
FCF growth 1Y140.41%
FCF growth 3Y-46.11%
FCF growth 5Y-28.45%
OCF growth 1Y517.41%
OCF growth 3Y-13.1%
OCF growth 5Y-3.99%