VALVOLINE INC (VVV) Stock Fundamental Analysis
USA - NYSE:VVV - US92047W1018 - Common Stock
40.17 USD
-0.3 (-0.74%)
40.17 USD
0 (0%)
We assign a fundamental rating of 5 out of 10 to VVV. VVV was compared to 121 industry peers in the Specialty Retail industry. VVV has an excellent profitability rating, but there are concerns on its financial health. VVV is quite expensive at the moment. It does show a decent growth rate.
1. Profitability
1.1 Basic Checks
VVV had positive earnings in the past year.
In the past year VVV had a positive cash flow from operations.
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
Looking at the Return On Assets, with a value of 10.85%, 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 88.65%. This is amongst the best in the industry. VVV outperforms 98.35% 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 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 12.11%.
The last Return On Invested Capital (11.30%) for VVV is above the 3 year average (9.44%), which is a sign of increasing profitability.
| 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
VVV's Profit Margin of 16.43% is amongst the best of the industry. VVV outperforms 97.52% of its industry peers.
In the last couple of years the Profit Margin of VVV has grown nicely.
VVV's Operating Margin of 18.65% is amongst the best of the industry. VVV outperforms 95.87% of its industry peers.
In the last couple of years the Operating Margin of VVV has grown nicely.
With a Gross Margin value of 38.49%, VVV perfoms like the industry average, outperforming 57.85% of the companies in the same industry.
In the last couple of years the Gross Margin of VVV has grown nicely.
| 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.
Compared to 1 year ago, VVV has less shares outstanding
VVV has less shares outstanding than it did 5 years ago.
VVV has a better debt/assets ratio than last year.
2.2 Solvency
VVV has an Altman-Z score of 2.53. 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.
Looking at the Altman-Z score, with a value of 2.53, VVV is in line with its industry, outperforming 53.72% of the companies in the same industry.
The Debt to FCF ratio of VVV is 24.05, which is on the high side as it means it would take VVV, 24.05 years of fcf income to pay off all of its debts.
VVV has a Debt to FCF ratio (24.05) which is comparable to the rest of the industry.
A Debt/Equity ratio of 3.37 is on the high side and indicates that VVV has dependencies on debt financing.
VVV has a Debt to Equity ratio of 3.37. This is in the lower half of the industry: VVV underperforms 76.86% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 3.37 | ||
| Debt/FCF | 24.05 | ||
| Altman-Z | 2.53 |
ROIC/WACC1.21
WACC9.35%
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.
VVV has a worse Current ratio (0.73) than 87.60% 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's Quick ratio of 0.60 is fine compared to the rest of the industry. VVV outperforms 60.33% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.73 | ||
| Quick Ratio | 0.6 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 6.00% over the past year.
VVV shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 2.47% yearly.
The Revenue has been growing slightly by 7.53% in the past year.
The Revenue has been decreasing by -7.49% on average over the past years.
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 13.47% 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 Y4.03%
EPS Next 2Y10.49%
EPS Next 3Y13.47%
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.
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
The Price/Earnings ratio is 25.26, which means the current valuation is very expensive for VVV.
Based on the Price/Earnings ratio, VVV is valued a bit cheaper than the industry average as 66.12% of the companies are valued more expensively.
When comparing the Price/Earnings ratio of VVV to the average of the S&P500 Index (27.27), we can say VVV is valued inline with the index average.
VVV is valuated rather expensively with a Price/Forward Earnings ratio of 20.96.
VVV's Price/Forward Earnings is on the same level as the industry average.
When comparing the Price/Forward Earnings ratio of VVV to the average of the S&P500 Index (22.77), we can say VVV is valued inline with the index average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 25.26 | ||
| Fwd PE | 20.96 |
4.2 Price Multiples
The rest of the industry has a similar Enterprise Value to EBITDA ratio as VVV.
VVV's Price/Free Cash Flow ratio is in line with the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 113.72 | ||
| EV/EBITDA | 14.28 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
The excellent profitability rating of VVV may justify a higher PE ratio.
VVV's earnings are expected to grow with 13.47% in the coming years. This may justify a more expensive valuation.
PEG (NY)6.26
PEG (5Y)10.25
EPS Next 2Y10.49%
EPS Next 3Y13.47%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 1.43%, VVV has a reasonable but not impressive dividend return.
VVV's Dividend Yield is a higher than the industry average which is at 5.21.
VVV's Dividend Yield is slightly below the S&P500 average, which is at 2.38.
| 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 3Y13.47%
40.17
-0.3 (-0.74%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Discretionary Distribution & Retail
GICS IndustrySpecialty Retail
Earnings (Last)
Earnings (Next)
Inst Owners104.79%
Inst Owner Change7.72%
Ins Owners0.26%
Ins Owner Change1.95%
Market Cap5.11B
Analysts76.84
Price Target45.6 (13.52%)
Short Float %7.35%
Short Ratio5.24
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)3.17%
PT rev (3m)6.03%
EPS NQ rev (1m)-0.29%
EPS NQ rev (3m)0%
EPS NY rev (1m)1.6%
EPS NY rev (3m)0.73%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-0.2%
Revenue NY rev (1m)0.17%
Revenue NY rev (3m)0.12%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 25.26 | ||
| Fwd PE | 20.96 | ||
| P/S | 3.02 | ||
| P/FCF | 113.72 | ||
| P/OCF | 18.46 | ||
| P/B | 16.28 | ||
| P/tB | N/A | ||
| EV/EBITDA | 14.28 |
EPS(TTM)1.59
EY3.96%
EPS(NY)1.92
Fwd EY4.77%
FCF(TTM)0.35
FCFY0.88%
OCF(TTM)2.18
OCFY5.42%
SpS13.31
BVpS2.47
TBVpS-3.14
PEG (NY)6.26
PEG (5Y)10.25
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 | 2.53 |
F-Score7
WACC9.35%
ROIC/WACC1.21
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 Y4.03%
EPS Next 2Y10.49%
EPS Next 3Y13.47%
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 Year38.52%
EBIT Next 3Y23.24%
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%