BREAD FINANCIAL HOLDINGS INC (BFH) Stock Fundamental Analysis
NYSE:BFH - New York Stock Exchange, Inc. - US0185811082 - Common Stock - Currency: USD
Overall BFH gets a fundamental rating of 4 out of 10. We evaluated BFH against 52 industry peers in the Consumer Finance industry. While BFH is still in line with the averages on profitability rating, there are concerns on its financial health. BFH has a bad growth rate and is valued cheaply.
1. Profitability
1.1 Basic Checks
BFH had positive earnings in the past year.
BFH had a positive operating cash flow in the past year.
BFH had positive earnings in each of the past 5 years.
In the past 5 years BFH always reported a positive cash flow from operatings.
1.2 Ratios
The Return On Assets of BFH (1.25%) is comparable to the rest of the industry.
The Return On Equity of BFH (9.13%) is comparable to the rest of the industry.
Looking at the Return On Invested Capital, with a value of 4.36%, BFH is in the better half of the industry, outperforming 61.54% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for BFH is significantly below the industry average of 10.33%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.25% | ||
| ROE | 9.13% | ||
| ROIC | 4.36% |
ROA(3y)1.73%
ROA(5y)1.96%
ROE(3y)14.51%
ROE(5y)19.2%
ROIC(3y)4.4%
ROIC(5y)4.64%
1.3 Margins
With a Profit Margin value of 6.11%, BFH is not doing good in the industry: 65.38% of the companies in the same industry are doing better.
BFH's Profit Margin has been stable in the last couple of years.
BFH has a Operating Margin of 28.52%. This is amongst the best in the industry. BFH outperforms 86.54% of its industry peers.
In the last couple of years the Operating Margin of BFH has remained more or less at the same level.
BFH has a Gross Margin of 93.00%. This is amongst the best in the industry. BFH outperforms 88.46% of its industry peers.
In the last couple of years the Gross Margin of BFH has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 28.52% | ||
| PM (TTM) | 6.11% | ||
| GM | 93% |
OM growth 3Y-9.81%
OM growth 5Y0.65%
PM growth 3Y-35.19%
PM growth 5Y0.78%
GM growth 3Y0.66%
GM growth 5Y0.7%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), BFH is creating some value.
The number of shares outstanding for BFH has been reduced compared to 1 year ago.
The number of shares outstanding for BFH has been increased compared to 5 years ago.
The debt/assets ratio for BFH has been reduced compared to a year ago.
2.2 Solvency
BFH has an Altman-Z score of 0.91. This is a bad value and indicates that BFH is not financially healthy and even has some risk of bankruptcy.
BFH has a better Altman-Z score (0.91) than 63.46% of its industry peers.
BFH has a debt to FCF ratio of 10.23. This is a negative value and a sign of low solvency as BFH would need 10.23 years to pay back of all of its debts.
BFH has a Debt to FCF ratio of 10.23. This is comparable to the rest of the industry: BFH outperforms 48.08% of its industry peers.
BFH has a Debt/Equity ratio of 5.94. This is a high value indicating a heavy dependency on external financing.
The Debt to Equity ratio of BFH (5.94) is worse than 76.92% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 5.94 | ||
| Debt/FCF | 10.23 | ||
| Altman-Z | 0.91 |
ROIC/WACC1.65
WACC2.65%
2.3 Liquidity
BFH has a Current Ratio of 1.52. This is a normal value and indicates that BFH is financially healthy and should not expect problems in meeting its short term obligations.
BFH has a Current ratio (1.52) which is comparable to the rest of the industry.
A Quick Ratio of 1.52 indicates that BFH should not have too much problems paying its short term obligations.
With a Quick ratio value of 1.52, BFH perfoms like the industry average, outperforming 59.62% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.52 | ||
| Quick Ratio | 1.52 |
3. Growth
3.1 Past
BFH shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -11.04%.
BFH shows a very negative growth in Earnings Per Share. Measured over the last years, the EPS has been decreasing by -15.20% yearly.
Looking at the last year, BFH shows a decrease in Revenue. The Revenue has decreased by -4.58% in the last year.
The Revenue has been decreasing by -0.19% on average over the past years.
EPS 1Y (TTM)-11.04%
EPS 3Y-25.81%
EPS 5Y-15.2%
EPS Q2Q%2.96%
Revenue 1Y (TTM)-4.58%
Revenue growth 3Y8.3%
Revenue growth 5Y-0.19%
Sales Q2Q%-2.12%
3.2 Future
BFH is expected to show a decrease in Earnings Per Share. In the coming years, the EPS will decrease by -0.75% yearly.
Based on estimates for the next years, BFH will show a small growth in Revenue. The Revenue will grow by 3.35% on average per year.
EPS Next Y-1.3%
EPS Next 2Y11.53%
EPS Next 3Y12.44%
EPS Next 5Y-0.75%
Revenue Next Year0.23%
Revenue Next 2Y2.18%
Revenue Next 3Y3.3%
Revenue Next 5Y3.35%
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
With a Price/Earnings ratio of 7.12, the valuation of BFH can be described as very cheap.
Based on the Price/Earnings ratio, BFH is valued a bit cheaper than the industry average as 76.92% of the companies are valued more expensively.
BFH's Price/Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 26.34.
With a Price/Forward Earnings ratio of 5.79, the valuation of BFH can be described as very cheap.
Based on the Price/Forward Earnings ratio, BFH is valued a bit cheaper than the industry average as 76.92% of the companies are valued more expensively.
Compared to an average S&P500 Price/Forward Earnings ratio of 22.19, BFH is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 7.12 | ||
| Fwd PE | 5.79 |
4.2 Price Multiples
BFH's Enterprise Value to EBITDA ratio is rather cheap when compared to the industry. BFH is cheaper than 88.46% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, BFH is valued cheaper than 88.46% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 1.38 | ||
| EV/EBITDA | 2.41 |
4.3 Compensation for Growth
The decent profitability rating of BFH may justify a higher PE ratio.
BFH's earnings are expected to grow with 12.44% in the coming years. This may justify a more expensive valuation.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y11.53%
EPS Next 3Y12.44%
5. Dividend
5.1 Amount
BFH has a Yearly Dividend Yield of 1.57%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 3.89, BFH has a dividend in line with its industry peers.
BFH's Dividend Yield is slightly below the S&P500 average, which is at 2.40.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.57% |
5.2 History
The dividend of BFH decreases each year by -19.10%.
BFH has paid a dividend for at least 10 years, which is a reliable track record.
BFH has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)-19.1%
Div Incr Years0
Div Non Decr Years3
5.3 Sustainability
BFH pays out 15.71% of its income as dividend. This is a sustainable payout ratio.
The Dividend Rate of BFH has been decling, while earnings will also be declining. This means the current dividend is most likely not sustainable.
DP15.71%
EPS Next 2Y11.53%
EPS Next 3Y12.44%
52.76
+1.05 (+2.03%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupFinancial Services
GICS IndustryConsumer Finance
Earnings (Last)
Earnings (Next)
Inst Owners108.41%
Inst Owner ChangeN/A
Ins Owners0.99%
Ins Owner Change11.38%
Market Cap2.46B
Analysts69
Price Target57.44 (8.87%)
Short Float %8.24%
Short Ratio3.9
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.57% |
Yearly Dividend0.87
Dividend Growth(5Y)-19.1%
DP15.71%
Div Incr Years0
Div Non Decr Years3
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-17.93%
Min EPS beat(2)-58.34%
Max EPS beat(2)22.48%
EPS beat(4)2
Avg EPS beat(4)2.55%
Min EPS beat(4)-58.34%
Max EPS beat(4)48.84%
EPS beat(8)5
Avg EPS beat(8)124.28%
EPS beat(12)8
Avg EPS beat(12)79.12%
EPS beat(16)10
Avg EPS beat(16)63.5%
Revenue beat(2)1
Avg Revenue beat(2)-2.17%
Min Revenue beat(2)-5.07%
Max Revenue beat(2)0.74%
Revenue beat(4)2
Avg Revenue beat(4)-1.09%
Min Revenue beat(4)-5.07%
Max Revenue beat(4)0.8%
Revenue beat(8)4
Avg Revenue beat(8)0.96%
Revenue beat(12)8
Avg Revenue beat(12)5.84%
Revenue beat(16)9
Avg Revenue beat(16)2.05%
PT rev (1m)1.53%
PT rev (3m)-20.35%
EPS NQ rev (1m)2.28%
EPS NQ rev (3m)-2.6%
EPS NY rev (1m)0%
EPS NY rev (3m)4.82%
Revenue NQ rev (1m)0.33%
Revenue NQ rev (3m)-0.84%
Revenue NY rev (1m)-0.13%
Revenue NY rev (3m)-0.73%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 7.12 | ||
| Fwd PE | 5.79 | ||
| P/S | 0.54 | ||
| P/FCF | 1.38 | ||
| P/OCF | 1.36 | ||
| P/B | 0.8 | ||
| P/tB | 1.05 | ||
| EV/EBITDA | 2.41 |
EPS(TTM)7.41
EY14.04%
EPS(NY)9.12
Fwd EY17.28%
FCF(TTM)38.26
FCFY72.52%
OCF(TTM)38.78
OCFY73.49%
SpS98.45
BVpS65.91
TBVpS50.05
PEG (NY)N/A
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.25% | ||
| ROE | 9.13% | ||
| ROCE | 14.08% | ||
| ROIC | 4.36% | ||
| ROICexc | 5.37% | ||
| ROICexgc | 6.07% | ||
| OM | 28.52% | ||
| PM (TTM) | 6.11% | ||
| GM | 93% | ||
| FCFM | 38.86% |
ROA(3y)1.73%
ROA(5y)1.96%
ROE(3y)14.51%
ROE(5y)19.2%
ROIC(3y)4.4%
ROIC(5y)4.64%
ROICexc(3y)5.33%
ROICexc(5y)5.71%
ROICexgc(3y)5.64%
ROICexgc(5y)6.71%
ROCE(3y)16.5%
ROCE(5y)14.09%
ROICexcg growth 3Y3.7%
ROICexcg growth 5Y-10.26%
ROICexc growth 3Y3.14%
ROICexc growth 5Y-6.25%
OM growth 3Y-9.81%
OM growth 5Y0.65%
PM growth 3Y-35.19%
PM growth 5Y0.78%
GM growth 3Y0.66%
GM growth 5Y0.7%
F-Score6
Asset Turnover0.2
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 5.94 | ||
| Debt/FCF | 10.23 | ||
| Debt/EBITDA | 13.06 | ||
| Cap/Depr | 27.27% | ||
| Cap/Sales | 0.52% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 129.39% | ||
| Profit Quality | 636.07% | ||
| Current Ratio | 1.52 | ||
| Quick Ratio | 1.52 | ||
| Altman-Z | 0.91 |
F-Score6
WACC2.65%
ROIC/WACC1.65
Cap/Depr(3y)47.19%
Cap/Depr(5y)47.85%
Cap/Sales(3y)1.11%
Cap/Sales(5y)1.41%
Profit Quality(3y)575.46%
Profit Quality(5y)552.61%
High Growth Momentum
Growth
EPS 1Y (TTM)-11.04%
EPS 3Y-25.81%
EPS 5Y-15.2%
EPS Q2Q%2.96%
EPS Next Y-1.3%
EPS Next 2Y11.53%
EPS Next 3Y12.44%
EPS Next 5Y-0.75%
Revenue 1Y (TTM)-4.58%
Revenue growth 3Y8.3%
Revenue growth 5Y-0.19%
Sales Q2Q%-2.12%
Revenue Next Year0.23%
Revenue Next 2Y2.18%
Revenue Next 3Y3.3%
Revenue Next 5Y3.35%
EBIT growth 1Y-8.41%
EBIT growth 3Y-2.32%
EBIT growth 5Y0.46%
EBIT Next Year-70.19%
EBIT Next 3Y-28.03%
EBIT Next 5YN/A
FCF growth 1Y5.38%
FCF growth 3Y7.71%
FCF growth 5Y11.13%
OCF growth 1Y3.2%
OCF growth 3Y6.41%
OCF growth 5Y8.83%