XP INC - CLASS A (XP)
KYG982391099 - Common Stock
We assign a fundamental rating of 5 out of 10 to XP. XP was compared to 220 industry peers in the Capital Markets industry. XP has a medium profitability rating, but doesn't score so well on its financial health evaluation. XP is evaluated to be cheap and growing strongly. This does not happen too often!
1. Profitability
1.1 Basic Checks
XP had positive earnings in the past year.
In the past year XP had a positive cash flow from operations.
Each year in the past 5 years XP has been profitable.
The reported operating cash flow has been mixed in the past 5 years: XP reported negative operating cash flow in multiple years.
1.2 Ratios
XP has a worse Return On Assets (1.38%) than 61.29% of its industry peers.
XP's Return On Equity of 20.49% is amongst the best of the industry. XP outperforms 87.10% of its industry peers.
Looking at the Return On Invested Capital, with a value of 1.36%, XP is doing worse than 73.73% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for XP is significantly below the industry average of 6.99%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.38% | ||
| ROE | 20.49% | ||
| ROIC | 1.36% |
ROA(3y)2%
ROA(5y)2.13%
ROE(3y)21.98%
ROE(5y)20.02%
ROIC(3y)1.82%
ROIC(5y)2.13%
1.3 Margins
Looking at the Profit Margin, with a value of 26.30%, XP is in the better half of the industry, outperforming 64.06% of the companies in the same industry.
XP's Profit Margin has improved in the last couple of years.
With a Operating Margin value of 32.36%, XP perfoms like the industry average, outperforming 56.68% of the companies in the same industry.
In the last couple of years the Operating Margin of XP has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 32.36% | ||
| PM (TTM) | 26.3% | ||
| GM | N/A |
OM growth 3Y-0.32%
OM growth 5Y4.94%
PM growth 3Y1%
PM growth 5Y10.98%
GM growth 3YN/A
GM growth 5YN/A
2. Health
2.1 Basic Checks
XP has more shares outstanding than it did 1 year ago.
The number of shares outstanding for XP has been reduced compared to 5 years ago.
XP has a better debt/assets ratio than last year.
2.2 Solvency
XP has an Altman-Z score of 0.05. This is a bad value and indicates that XP is not financially healthy and even has some risk of bankruptcy.
The Altman-Z score of XP (0.05) is worse than 76.96% of its industry peers.
XP has a debt to FCF ratio of 6.76. This is a slightly negative value and a sign of low solvency as XP would need 6.76 years to pay back of all of its debts.
Looking at the Debt to FCF ratio, with a value of 6.76, XP is in line with its industry, outperforming 58.99% of the companies in the same industry.
XP has a Debt/Equity ratio of 3.52. This is a high value indicating a heavy dependency on external financing.
XP has a Debt to Equity ratio of 3.52. This is amonst the worse of the industry: XP underperforms 82.95% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 3.52 | ||
| Debt/FCF | 6.76 | ||
| Altman-Z | 0.05 |
ROIC/WACCN/A
WACCN/A
2.3 Liquidity
A Current Ratio of 0.14 indicates that XP may have some problems paying its short term obligations.
The Current ratio of XP (0.14) is worse than 89.86% of its industry peers.
A Quick Ratio of 0.14 indicates that XP may have some problems paying its short term obligations.
XP has a worse Quick ratio (0.14) than 89.86% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.14 | ||
| Quick Ratio | 0.14 |
3. Growth
3.1 Past
XP shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 17.40%, which is quite good.
The Earnings Per Share has been growing by 53.52% on average over the past years. This is a very strong growth
XP shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 18.91%.
Measured over the past years, XP shows a very strong growth in Revenue. The Revenue has been growing by 38.10% on average per year.
EPS 1Y (TTM)17.4%
EPS 3Y24.1%
EPS 5Y53.52%
EPS Q2Q%2.82%
Revenue 1Y (TTM)18.91%
Revenue growth 3Y22.16%
Revenue growth 5Y38.1%
Sales Q2Q%4.52%
3.2 Future
XP is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 11.72% yearly.
Based on estimates for the next years, XP will show a quite strong growth in Revenue. The Revenue will grow by 14.23% on average per year.
EPS Next Y11.19%
EPS Next 2Y11.91%
EPS Next 3Y11.72%
EPS Next 5YN/A
Revenue Next Year14.35%
Revenue Next 2Y15.83%
Revenue Next 3Y14.23%
Revenue Next 5YN/A
3.3 Evolution
Although the future EPS growth is still strong, it is not able to hold up the even more excellent growth rate of the past 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
Based on the Price/Earnings ratio of 8.82, the valuation of XP can be described as reasonable.
Based on the Price/Earnings ratio, XP is valued a bit cheaper than the industry average as 75.12% of the companies are valued more expensively.
XP's Price/Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 27.30.
XP is valuated cheaply with a Price/Forward Earnings ratio of 7.70.
Based on the Price/Forward Earnings ratio, XP is valued cheaper than 87.10% of the companies in the same industry.
XP's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 23.80.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 8.82 | ||
| Fwd PE | 7.7 |
4.2 Price Multiples
XP's Enterprise Value to EBITDA ratio is rather cheap when compared to the industry. XP is cheaper than 89.86% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, XP is valued cheaper than 88.02% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 3.56 | ||
| EV/EBITDA | 7.5 |
4.3 Compensation for Growth
XP's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
PEG (NY)0.79
PEG (5Y)0.16
EPS Next 2Y11.91%
EPS Next 3Y11.72%
5. Dividend
5.1 Amount
XP has a Yearly Dividend Yield of 21.74%, which is a nice return.
The stock price of XP dropped by -33.63% in the last 3 months. With lower prices the dividend yield is higher, but it may be a sign investors do not trust the long term dividend.
Compared to an average industry Dividend Yield of 9.57, XP pays a better dividend. On top of this XP pays more dividend than 94.01% of the companies listed in the same industry.
XP's Dividend Yield is rather good when compared to the S&P500 average which is at 2.36.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 21.74% |
5.2 History
XP is new to the dividend game and has less than 3 years of track record.
Dividend Growth(5Y)N/A
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
44.90% of the earnings are spent on dividend by XP. This is a bit on the high side, but may be sustainable.
DP44.9%
EPS Next 2Y11.91%
EPS Next 3Y11.72%
XP INC - CLASS A
NASDAQ:XP (12/27/2024, 8:00:02 PM)
After market: 12.02 -0.06 (-0.5%)12.08
-0.1 (-0.82%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupFinancial Services
GICS IndustryCapital Markets
Earnings (Last)
Earnings (Next)
Inst Owners73.62%
Inst Owner Change11.98%
Ins OwnersN/A
Ins Owner ChangeN/A
Market Cap6.50B
Analysts80
Price Target25.16 (108.28%)
Short Float %3.37%
Short Ratio2.4
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 21.74% |
Dividend Growth(5Y)N/A
DP44.9%
Div Incr Years0
Div Non Decr Years0
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-0.41%
Min EPS beat(2)-2.46%
Max EPS beat(2)1.63%
EPS beat(4)3
Avg EPS beat(4)1.04%
Min EPS beat(4)-2.46%
Max EPS beat(4)3.31%
EPS beat(8)6
Avg EPS beat(8)-0.48%
EPS beat(12)10
Avg EPS beat(12)4.75%
EPS beat(16)14
Avg EPS beat(16)10.34%
Revenue beat(2)0
Avg Revenue beat(2)-2.47%
Min Revenue beat(2)-3.77%
Max Revenue beat(2)-1.17%
Revenue beat(4)0
Avg Revenue beat(4)-2.61%
Min Revenue beat(4)-3.77%
Max Revenue beat(4)-1.17%
Revenue beat(8)1
Avg Revenue beat(8)-2.9%
Revenue beat(12)2
Avg Revenue beat(12)-3.48%
Revenue beat(16)4
Avg Revenue beat(16)-2.53%
PT rev (1m)-4.72%
PT rev (3m)-2.99%
EPS NQ rev (1m)-3.04%
EPS NQ rev (3m)1.66%
EPS NY rev (1m)0.27%
EPS NY rev (3m)0.64%
Revenue NQ rev (1m)0.79%
Revenue NQ rev (3m)-2.2%
Revenue NY rev (1m)-2.51%
Revenue NY rev (3m)-2.29%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 8.82 | ||
| Fwd PE | 7.7 | ||
| P/S | 2.42 | ||
| P/FCF | 3.56 | ||
| P/OCF | 3.5 | ||
| P/B | 1.89 | ||
| P/tB | 2.15 | ||
| EV/EBITDA | 7.5 |
EPS(TTM)1.37
EY11.34%
EPS(NY)1.57
Fwd EY12.99%
FCF(TTM)3.39
FCFY28.06%
OCF(TTM)3.45
OCFY28.54%
SpS4.99
BVpS6.41
TBVpS5.63
PEG (NY)0.79
PEG (5Y)0.16
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.38% | ||
| ROE | 20.49% | ||
| ROCE | 2.21% | ||
| ROIC | 1.36% | ||
| ROICexc | 1.38% | ||
| ROICexgc | 1.78% | ||
| OM | 32.36% | ||
| PM (TTM) | 26.3% | ||
| GM | N/A | ||
| FCFM | 67.91% |
ROA(3y)2%
ROA(5y)2.13%
ROE(3y)21.98%
ROE(5y)20.02%
ROIC(3y)1.82%
ROIC(5y)2.13%
ROICexc(3y)1.85%
ROICexc(5y)2.16%
ROICexgc(3y)2.32%
ROICexgc(5y)2.58%
ROCE(3y)2.97%
ROCE(5y)3.96%
ROICexcg growth 3Y-7.27%
ROICexcg growth 5Y-12.07%
ROICexc growth 3Y-11.33%
ROICexc growth 5Y-14.45%
OM growth 3Y-0.32%
OM growth 5Y4.94%
PM growth 3Y1%
PM growth 5Y10.98%
GM growth 3YN/A
GM growth 5YN/A
F-Score6
Asset Turnover0.05
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 3.52 | ||
| Debt/FCF | 6.76 | ||
| Debt/EBITDA | 13.24 | ||
| Cap/Depr | 66.11% | ||
| Cap/Sales | 1.15% | ||
| Interest Coverage | 21.1 | ||
| Cash Conversion | 202.52% | ||
| Profit Quality | 258.2% | ||
| Current Ratio | 0.14 | ||
| Quick Ratio | 0.14 | ||
| Altman-Z | 0.05 |
F-Score6
WACCN/A
ROIC/WACCN/A
Cap/Depr(3y)97.27%
Cap/Depr(5y)134.66%
Cap/Sales(3y)1.73%
Cap/Sales(5y)2.38%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)17.4%
EPS 3Y24.1%
EPS 5Y53.52%
EPS Q2Q%2.82%
EPS Next Y11.19%
EPS Next 2Y11.91%
EPS Next 3Y11.72%
EPS Next 5YN/A
Revenue 1Y (TTM)18.91%
Revenue growth 3Y22.16%
Revenue growth 5Y38.1%
Sales Q2Q%4.52%
Revenue Next Year14.35%
Revenue Next 2Y15.83%
Revenue Next 3Y14.23%
Revenue Next 5YN/A
EBIT growth 1Y27.03%
EBIT growth 3Y21.76%
EBIT growth 5Y44.92%
EBIT Next Year34.41%
EBIT Next 3Y19.9%
EBIT Next 5YN/A
FCF growth 1Y846.89%
FCF growth 3Y86.67%
FCF growth 5YN/A
OCF growth 1Y796.8%
OCF growth 3Y75.22%
OCF growth 5YN/A