DNOW INC (DNOW) Stock Fundamental Analysis
NYSE:DNOW - New York Stock Exchange, Inc. - US67011P1003 - Common Stock - Currency: USD
Taking everything into account, DNOW scores 5 out of 10 in our fundamental rating. DNOW was compared to 49 industry peers in the Trading Companies & Distributors industry. DNOW has an excellent financial health rating, but there are some minor concerns on its profitability. DNOW has a valuation in line with the averages, but it does not seem to be growing.
1. Profitability
1.1 Basic Checks
In the past year DNOW was profitable.
In the past year DNOW had a positive cash flow from operations.
DNOW had positive earnings in 4 of the past 5 years.
Of the past 5 years DNOW 4 years had a positive operating cash flow.
1.2 Ratios
DNOW has a Return On Assets (4.97%) which is in line with its industry peers.
Looking at the Return On Equity, with a value of 7.20%, DNOW is doing worse than 63.27% of the companies in the same industry.
DNOW has a Return On Invested Capital of 7.85%. This is in the better half of the industry: DNOW outperforms 63.27% of its industry peers.
The Average Return On Invested Capital over the past 3 years for DNOW is in line with the industry average of 9.65%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.97% | ||
| ROE | 7.2% | ||
| ROIC | 7.85% |
ROA(3y)10.2%
ROA(5y)-2.26%
ROE(3y)15.11%
ROE(5y)-3.01%
ROIC(3y)9.28%
ROIC(5y)N/A
1.3 Margins
DNOW has a Profit Margin (3.40%) which is comparable to the rest of the industry.
In the last couple of years the Profit Margin of DNOW has grown nicely.
With a Operating Margin value of 5.40%, DNOW is not doing good in the industry: 65.31% of the companies in the same industry are doing better.
DNOW's Operating Margin has improved in the last couple of years.
Looking at the Gross Margin, with a value of 22.83%, DNOW is doing worse than 71.43% of the companies in the same industry.
In the last couple of years the Gross Margin of DNOW has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 5.4% | ||
| PM (TTM) | 3.4% | ||
| GM | 22.83% |
OM growth 3Y72.3%
OM growth 5Y26.88%
PM growth 3Y123.35%
PM growth 5YN/A
GM growth 3Y1.01%
GM growth 5Y2.57%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), DNOW is destroying value.
DNOW has less shares outstanding than it did 1 year ago.
Compared to 5 years ago, DNOW has less shares outstanding
The debt/assets ratio for DNOW is higher compared to a year ago.
2.2 Solvency
DNOW has an Altman-Z score of 3.33. This indicates that DNOW is financially healthy and has little risk of bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 3.33, DNOW is in the better half of the industry, outperforming 61.22% of the companies in the same industry.
There is no outstanding debt for DNOW. This means it has a Debt/Equity and Debt/FCF ratio of 0 and it is amongst the best of the sector and industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0 | ||
| Altman-Z | 3.33 |
ROIC/WACC0.78
WACC10.02%
2.3 Liquidity
DNOW has a Current Ratio of 2.32. This indicates that DNOW is financially healthy and has no problem in meeting its short term obligations.
With a decent Current ratio value of 2.32, DNOW is doing good in the industry, outperforming 61.22% of the companies in the same industry.
A Quick Ratio of 1.48 indicates that DNOW should not have too much problems paying its short term obligations.
DNOW's Quick ratio of 1.48 is fine compared to the rest of the industry. DNOW outperforms 63.27% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.32 | ||
| Quick Ratio | 1.48 |
3. Growth
3.1 Past
DNOW shows a slight negative growth in Earnings Per Share. In the last year, the EPS has decreased by 0.00%.
Measured over the past years, DNOW shows a very strong growth in Earnings Per Share. The EPS has been growing by 30.83% on average per year.
The Revenue has been growing slightly by 4.74% in the past year.
The Revenue has been decreasing by -4.27% on average over the past years.
EPS 1Y (TTM)0%
EPS 3Y97.18%
EPS 5Y30.83%
EPS Q2Q%4.76%
Revenue 1Y (TTM)4.74%
Revenue growth 3Y13.29%
Revenue growth 5Y-4.27%
Sales Q2Q%6.39%
3.2 Future
Based on estimates for the next years, DNOW will show a small growth in Earnings Per Share. The EPS will grow by 7.62% on average per year.
Based on estimates for the next years, DNOW will show a small growth in Revenue. The Revenue will grow by 4.35% on average per year.
EPS Next Y-1.33%
EPS Next 2Y3.17%
EPS Next 3Y4.86%
EPS Next 5Y7.62%
Revenue Next Year2.95%
Revenue Next 2Y4.12%
Revenue Next 3Y3.32%
Revenue Next 5Y4.35%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
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 15.48, DNOW is valued correctly.
Compared to the rest of the industry, the Price/Earnings ratio of DNOW indicates a somewhat cheap valuation: DNOW is cheaper than 73.47% of the companies listed in the same industry.
The average S&P500 Price/Earnings ratio is at 26.29. DNOW is valued slightly cheaper when compared to this.
A Price/Forward Earnings ratio of 14.71 indicates a correct valuation of DNOW.
63.27% of the companies in the same industry are more expensive than DNOW, based on the Price/Forward Earnings ratio.
Compared to an average S&P500 Price/Forward Earnings ratio of 22.17, DNOW is valued a bit cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.48 | ||
| Fwd PE | 14.71 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, DNOW is valued cheaply inside the industry as 83.67% of the companies are valued more expensively.
Based on the Price/Free Cash Flow ratio, DNOW is valued cheaply inside the industry as 93.88% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 8.13 | ||
| EV/EBITDA | 7.76 |
4.3 Compensation for Growth
PEG (NY)N/A
PEG (5Y)0.5
EPS Next 2Y3.17%
EPS Next 3Y4.86%
5. Dividend
5.1 Amount
No dividends for DNOW!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
14.4
-0.02 (-0.14%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryTrading Companies & Distributors
Earnings (Last)
Earnings (Next)
Inst Owners101.96%
Inst Owner Change-0.61%
Ins Owners1.98%
Ins Owner Change8.54%
Market Cap1.52B
Analysts82.5
Price Target19.38 (34.58%)
Short Float %2.4%
Short Ratio2.17
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Yearly DividendN/A
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)53%
Min EPS beat(2)24.44%
Max EPS beat(2)81.55%
EPS beat(4)3
Avg EPS beat(4)26.54%
Min EPS beat(4)-1.96%
Max EPS beat(4)81.55%
EPS beat(8)4
Avg EPS beat(8)15.07%
EPS beat(12)8
Avg EPS beat(12)17.81%
EPS beat(16)12
Avg EPS beat(16)50.45%
Revenue beat(2)2
Avg Revenue beat(2)0.54%
Min Revenue beat(2)0.02%
Max Revenue beat(2)1.07%
Revenue beat(4)2
Avg Revenue beat(4)-1.05%
Min Revenue beat(4)-3.38%
Max Revenue beat(4)1.07%
Revenue beat(8)3
Avg Revenue beat(8)-1.59%
Revenue beat(12)7
Avg Revenue beat(12)-0.22%
Revenue beat(16)10
Avg Revenue beat(16)0.12%
PT rev (1m)0%
PT rev (3m)3.64%
EPS NQ rev (1m)-1.54%
EPS NQ rev (3m)1.59%
EPS NY rev (1m)-1.84%
EPS NY rev (3m)5.64%
Revenue NQ rev (1m)-0.46%
Revenue NQ rev (3m)5.35%
Revenue NY rev (1m)-2.25%
Revenue NY rev (3m)0%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.48 | ||
| Fwd PE | 14.71 | ||
| P/S | 0.63 | ||
| P/FCF | 8.13 | ||
| P/OCF | 7.56 | ||
| P/B | 1.33 | ||
| P/tB | 1.8 | ||
| EV/EBITDA | 7.76 |
EPS(TTM)0.93
EY6.46%
EPS(NY)0.98
Fwd EY6.8%
FCF(TTM)1.77
FCFY12.3%
OCF(TTM)1.9
OCFY13.22%
SpS22.82
BVpS10.79
TBVpS8.01
PEG (NY)N/A
PEG (5Y)0.5
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.97% | ||
| ROE | 7.2% | ||
| ROCE | 10.92% | ||
| ROIC | 7.85% | ||
| ROICexc | 9.62% | ||
| ROICexgc | 13.77% | ||
| OM | 5.4% | ||
| PM (TTM) | 3.4% | ||
| GM | 22.83% | ||
| FCFM | 7.76% |
ROA(3y)10.2%
ROA(5y)-2.26%
ROE(3y)15.11%
ROE(5y)-3.01%
ROIC(3y)9.28%
ROIC(5y)N/A
ROICexc(3y)12.28%
ROICexc(5y)N/A
ROICexgc(3y)16.15%
ROICexgc(5y)N/A
ROCE(3y)12.9%
ROCE(5y)N/A
ROICexcg growth 3Y60.02%
ROICexcg growth 5Y23.31%
ROICexc growth 3Y50.38%
ROICexc growth 5Y23.73%
OM growth 3Y72.3%
OM growth 5Y26.88%
PM growth 3Y123.35%
PM growth 5YN/A
GM growth 3Y1.01%
GM growth 5Y2.57%
F-Score7
Asset Turnover1.46
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0 | ||
| Debt/EBITDA | 0 | ||
| Cap/Depr | 36.84% | ||
| Cap/Sales | 0.58% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 119.64% | ||
| Profit Quality | 228.05% | ||
| Current Ratio | 2.32 | ||
| Quick Ratio | 1.48 | ||
| Altman-Z | 3.33 |
F-Score7
WACC10.02%
ROIC/WACC0.78
Cap/Depr(3y)46.41%
Cap/Depr(5y)37.91%
Cap/Sales(3y)0.51%
Cap/Sales(5y)0.47%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)0%
EPS 3Y97.18%
EPS 5Y30.83%
EPS Q2Q%4.76%
EPS Next Y-1.33%
EPS Next 2Y3.17%
EPS Next 3Y4.86%
EPS Next 5Y7.62%
Revenue 1Y (TTM)4.74%
Revenue growth 3Y13.29%
Revenue growth 5Y-4.27%
Sales Q2Q%6.39%
Revenue Next Year2.95%
Revenue Next 2Y4.12%
Revenue Next 3Y3.32%
Revenue Next 5Y4.35%
EBIT growth 1Y-4.41%
EBIT growth 3Y95.2%
EBIT growth 5Y21.47%
EBIT Next Year72.25%
EBIT Next 3Y25.1%
EBIT Next 5Y21.12%
FCF growth 1Y9250%
FCF growth 3Y126.11%
FCF growth 5Y6.39%
OCF growth 1Y1156.25%
OCF growth 3Y114.96%
OCF growth 5Y5.88%