XP INC - CLASS A (XP) Stock Fundamental Analysis
USA - NASDAQ:XP - KYG982391099 - Common Stock
18.66 USD
-0.42 (-2.2%)
19.1504 USD
+0.49 (+2.63%)
Taking everything into account, XP scores 4 out of 10 in our fundamental rating. XP was compared to 237 industry peers in the Capital Markets industry. While XP is still in line with the averages on profitability rating, there are concerns on its financial health. An interesting combination arises when we look at growth and value: XP is growing strongly while it also seems undervalued.
1. Profitability
1.1 Basic Checks
In the past year XP was profitable.
In the past year XP had a positive cash flow from operations.
In the past 5 years XP has always been profitable.
Of the past 5 years XP 4 years had a positive operating cash flow.
1.2 Ratios
XP has a worse Return On Assets (1.32%) than 62.87% of its industry peers.
XP's Return On Equity of 22.10% is amongst the best of the industry. XP outperforms 89.03% of its industry peers.
XP has a worse Return On Invested Capital (1.25%) than 64.56% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for XP is significantly below the industry average of 7.47%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.32% | ||
| ROE | 22.1% | ||
| ROIC | 1.25% |
ROA(3y)1.58%
ROA(5y)1.89%
ROE(3y)21.19%
ROE(5y)21.51%
ROIC(3y)1.49%
ROIC(5y)1.78%
1.3 Margins
XP has a better Profit Margin (28.02%) than 72.15% of its industry peers.
In the last couple of years the Profit Margin of XP has grown nicely.
The Operating Margin of XP (33.11%) is better than 63.71% of its industry peers.
XP's Operating Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 33.11% | ||
| PM (TTM) | 28.02% | ||
| GM | N/A |
OM growth 3Y0.94%
OM growth 5Y1.22%
PM growth 3Y-3.75%
PM growth 5Y4.69%
GM growth 3YN/A
GM growth 5YN/A
2. Health
2.1 Basic Checks
XP has less shares outstanding than it did 1 year ago.
Compared to 5 years ago, XP has less shares outstanding
Compared to 1 year ago, XP has a worse debt to assets ratio.
2.2 Solvency
XP has an Altman-Z score of 0.04. This is a bad value and indicates that XP is not financially healthy and even has some risk of bankruptcy.
XP has a Altman-Z score of 0.04. This is in the lower half of the industry: XP underperforms 75.11% of its industry peers.
XP has a debt to FCF ratio of 9.13. This is a negative value and a sign of low solvency as XP would need 9.13 years to pay back of all of its debts.
The Debt to FCF ratio of XP (9.13) is comparable to the rest of the industry.
A Debt/Equity ratio of 4.06 is on the high side and indicates that XP has dependencies on debt financing.
The Debt to Equity ratio of XP (4.06) is worse than 83.97% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 4.06 | ||
| Debt/FCF | 9.13 | ||
| Altman-Z | 0.04 |
ROIC/WACCN/A
WACCN/A
2.3 Liquidity
A Current Ratio of 0.20 indicates that XP may have some problems paying its short term obligations.
The Current ratio of XP (0.20) is worse than 86.50% of its industry peers.
XP has a Quick Ratio of 0.20. This is a bad value and indicates that XP is not financially healthy enough and could expect problems in meeting its short term obligations.
Looking at the Quick ratio, with a value of 0.20, XP is doing worse than 86.50% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.2 | ||
| Quick Ratio | 0.2 |
3. Growth
3.1 Past
XP shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 8.65%, which is quite good.
Measured over the past years, XP shows a very strong growth in Earnings Per Share. The EPS has been growing by 33.24% on average per year.
The Revenue has been growing slightly by 6.74% in the past year.
Measured over the past years, XP shows a very strong growth in Revenue. The Revenue has been growing by 27.13% on average per year.
EPS 1Y (TTM)8.65%
EPS 3Y7.19%
EPS 5Y33.24%
EPS Q2Q%20.59%
Revenue 1Y (TTM)6.74%
Revenue growth 3Y12.14%
Revenue growth 5Y27.13%
Sales Q2Q%5.6%
3.2 Future
Based on estimates for the next years, XP will show a quite strong growth in Earnings Per Share. The EPS will grow by 12.46% on average per year.
Based on estimates for the next years, XP will show a quite strong growth in Revenue. The Revenue will grow by 10.40% on average per year.
EPS Next Y15.29%
EPS Next 2Y12.65%
EPS Next 3Y12.46%
EPS Next 5YN/A
Revenue Next Year7.41%
Revenue Next 2Y9.59%
Revenue Next 3Y10.82%
Revenue Next 5Y10.4%
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
A Price/Earnings ratio of 10.72 indicates a reasonable valuation of XP.
Compared to the rest of the industry, the Price/Earnings ratio of XP indicates a somewhat cheap valuation: XP is cheaper than 66.24% of the companies listed in the same industry.
XP's Price/Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 25.89.
A Price/Forward Earnings ratio of 9.01 indicates a reasonable valuation of XP.
XP's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. XP is cheaper than 75.11% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of XP to the average of the S&P500 Index (34.59), we can say XP is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 10.72 | ||
| Fwd PE | 9.01 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, XP is valued cheaply inside the industry as 89.45% of the companies are valued more expensively.
Based on the Price/Free Cash Flow ratio, XP is valued cheaply inside the industry as 80.17% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 5.08 | ||
| EV/EBITDA | 8.13 |
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.
XP's earnings are expected to grow with 12.46% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.7
PEG (5Y)0.32
EPS Next 2Y12.65%
EPS Next 3Y12.46%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 15.69%, XP is a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 8.45, XP pays a better dividend. On top of this XP pays more dividend than 91.14% 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 2.42.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 15.69% |
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
41.40% of the earnings are spent on dividend by XP. This is a bit on the high side, but may be sustainable.
DP41.4%
EPS Next 2Y12.65%
EPS Next 3Y12.46%
18.66
-0.42 (-2.2%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupFinancial Services
GICS IndustryCapital Markets
Earnings (Last)
Earnings (Next)
Inst Owners82.04%
Inst Owner Change3.69%
Ins OwnersN/A
Ins Owner ChangeN/A
Market Cap9.85B
Revenue(TTM)17.56B
Net Income(TTM)4.92B
Analysts81.11
Price Target23.23 (24.49%)
Short Float %5.55%
Short Ratio3.03
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 15.69% |
Yearly Dividend0.7
Dividend Growth(5Y)N/A
DP41.4%
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)1.66%
Min EPS beat(2)1.46%
Max EPS beat(2)1.86%
EPS beat(4)2
Avg EPS beat(4)-0.19%
Min EPS beat(4)-2.46%
Max EPS beat(4)1.86%
EPS beat(8)6
Avg EPS beat(8)0.77%
EPS beat(12)9
Avg EPS beat(12)1.96%
EPS beat(16)13
Avg EPS beat(16)4.8%
Revenue beat(2)0
Avg Revenue beat(2)-5.2%
Min Revenue beat(2)-5.74%
Max Revenue beat(2)-4.66%
Revenue beat(4)0
Avg Revenue beat(4)-4.3%
Min Revenue beat(4)-5.74%
Max Revenue beat(4)-3.04%
Revenue beat(8)1
Avg Revenue beat(8)-2.41%
Revenue beat(12)2
Avg Revenue beat(12)-2.87%
Revenue beat(16)2
Avg Revenue beat(16)-3.8%
PT rev (1m)-0.49%
PT rev (3m)0.34%
EPS NQ rev (1m)-0.25%
EPS NQ rev (3m)0.5%
EPS NY rev (1m)0.22%
EPS NY rev (3m)2.41%
Revenue NQ rev (1m)-0.5%
Revenue NQ rev (3m)-1.61%
Revenue NY rev (1m)-0.1%
Revenue NY rev (3m)-1.51%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 10.72 | ||
| Fwd PE | 9.01 | ||
| P/S | 2.96 | ||
| P/FCF | 5.08 | ||
| P/OCF | 4.9 | ||
| P/B | 2.34 | ||
| P/tB | 2.66 | ||
| EV/EBITDA | 8.13 |
EPS(TTM)1.74
EY9.32%
EPS(NY)2.07
Fwd EY11.1%
FCF(TTM)3.67
FCFY19.68%
OCF(TTM)3.81
OCFY20.43%
SpS6.29
BVpS7.98
TBVpS7.03
PEG (NY)0.7
PEG (5Y)0.32
Graham Number17.68
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.32% | ||
| ROE | 22.1% | ||
| ROCE | 2.05% | ||
| ROIC | 1.25% | ||
| ROICexc | 1.29% | ||
| ROICexgc | 1.75% | ||
| OM | 33.11% | ||
| PM (TTM) | 28.02% | ||
| GM | N/A | ||
| FCFM | 58.35% |
ROA(3y)1.58%
ROA(5y)1.89%
ROE(3y)21.19%
ROE(5y)21.51%
ROIC(3y)1.49%
ROIC(5y)1.78%
ROICexc(3y)1.51%
ROICexc(5y)1.81%
ROICexgc(3y)1.95%
ROICexgc(5y)2.25%
ROCE(3y)2.48%
ROCE(5y)3.08%
ROICexgc growth 3Y-14.78%
ROICexgc growth 5Y-12.26%
ROICexc growth 3Y-16.98%
ROICexc growth 5Y-15.13%
OM growth 3Y0.94%
OM growth 5Y1.22%
PM growth 3Y-3.75%
PM growth 5Y4.69%
GM growth 3YN/A
GM growth 5YN/A
F-Score6
Asset Turnover0.05
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 4.06 | ||
| Debt/FCF | 9.13 | ||
| Debt/EBITDA | 14.85 | ||
| Cap/Depr | 137.12% | ||
| Cap/Sales | 2.2% | ||
| Interest Coverage | 16.42 | ||
| Cash Conversion | 174.43% | ||
| Profit Quality | 208.2% | ||
| Current Ratio | 0.2 | ||
| Quick Ratio | 0.2 | ||
| Altman-Z | 0.04 |
F-Score6
WACCN/A
ROIC/WACCN/A
Cap/Depr(3y)87.96%
Cap/Depr(5y)123.94%
Cap/Sales(3y)1.4%
Cap/Sales(5y)2.14%
Profit Quality(3y)163.55%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)8.65%
EPS 3Y7.19%
EPS 5Y33.24%
EPS Q2Q%20.59%
EPS Next Y15.29%
EPS Next 2Y12.65%
EPS Next 3Y12.46%
EPS Next 5YN/A
Revenue 1Y (TTM)6.74%
Revenue growth 3Y12.14%
Revenue growth 5Y27.13%
Sales Q2Q%5.6%
Revenue Next Year7.41%
Revenue Next 2Y9.59%
Revenue Next 3Y10.82%
Revenue Next 5Y10.4%
EBIT growth 1Y10.66%
EBIT growth 3Y13.19%
EBIT growth 5Y28.69%
EBIT Next Year10.91%
EBIT Next 3Y13.72%
EBIT Next 5Y12.13%
FCF growth 1Y60.25%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y62.72%
OCF growth 3YN/A
OCF growth 5YN/A
XP INC - CLASS A / XP FAQ
What is the ChartMill fundamental rating of XP INC - CLASS A (XP) stock?
ChartMill assigns a fundamental rating of 4 / 10 to XP.
What is the valuation status of XP INC - CLASS A (XP) stock?
ChartMill assigns a valuation rating of 8 / 10 to XP INC - CLASS A (XP). This can be considered as Undervalued.
Can you provide the profitability details for XP INC - CLASS A?
XP INC - CLASS A (XP) has a profitability rating of 4 / 10.
What is the valuation of XP INC - CLASS A based on its PE and PB ratios?
The Price/Earnings (PE) ratio for XP INC - CLASS A (XP) is 10.72 and the Price/Book (PB) ratio is 2.34.
Can you provide the dividend sustainability for XP stock?
The dividend rating of XP INC - CLASS A (XP) is 5 / 10 and the dividend payout ratio is 41.4%.