INTERNATIONAL PAPER CO (IP) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:IP - US4601461035 - Common Stock
42.2 USD
-0.8 (-1.86%)
42.25 USD
+0.05 (+0.12%)
Taking everything into account, IP scores 3 out of 10 in our fundamental rating. IP was compared to 22 industry peers in the Containers & Packaging industry. Both the profitability and financial health of IP have multiple concerns. IP is quite expensive at the moment. It does show a decent growth rate.
1. Profitability
1.1 Basic Checks
- In the past year IP has reported negative net income.
- In the past year IP had a positive cash flow from operations.
- Each year in the past 5 years IP has been profitable.
- IP had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
- IP's Return On Assets of -3.15% is on the low side compared to the rest of the industry. IP is outperformed by 77.27% of its industry peers.
- The Return On Equity of IP (-7.39%) is worse than 72.73% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -3.15% | ||
| ROE | -7.39% | ||
| ROIC | N/A |
ROA(3y)3.32%
ROA(5y)3.68%
ROE(3y)9.32%
ROE(5y)10.68%
ROIC(3y)N/A
ROIC(5y)N/A
1.3 Margins
- IP's Profit Margin has declined in the last couple of years.
- In the last couple of years the Operating Margin of IP has declined.
- With a decent Gross Margin value of 28.96%, IP is doing good in the industry, outperforming 77.27% of the companies in the same industry.
- In the last couple of years the Gross Margin of IP has declined.
- The Profit Margin and Operating Margin are not available for IP so they could not be analyzed.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | N/A | ||
| PM (TTM) | N/A | ||
| GM | 28.96% |
OM growth 3Y-30.36%
OM growth 5Y-25.08%
PM growth 3Y-30.85%
PM growth 5Y-11.38%
GM growth 3Y-0.48%
GM growth 5Y-2.38%
2. Health
2.1 Basic Checks
- IP does not have a ROIC to compare to the WACC, probably because it is not profitable.
- IP has more shares outstanding than it did 1 year ago.
- The number of shares outstanding for IP has been reduced compared to 5 years ago.
- Compared to 1 year ago, IP has a worse debt to assets ratio.
2.2 Solvency
- IP has an Altman-Z score of 1.48. This is a bad value and indicates that IP is not financially healthy and even has some risk of bankruptcy.
- The Altman-Z score of IP (1.48) is worse than 72.73% of its industry peers.
- IP has a Debt/Equity ratio of 0.64. This is a neutral value indicating IP is somewhat dependend on debt financing.
- IP has a Debt to Equity ratio of 0.64. This is in the better half of the industry: IP outperforms 77.27% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.64 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 1.48 |
ROIC/WACCN/A
WACC9.18%
2.3 Liquidity
- IP has a Current Ratio of 1.31. This is a normal value and indicates that IP is financially healthy and should not expect problems in meeting its short term obligations.
- Looking at the Current ratio, with a value of 1.31, IP is in line with its industry, outperforming 45.45% of the companies in the same industry.
- A Quick Ratio of 1.04 indicates that IP should not have too much problems paying its short term obligations.
- The Quick ratio of IP (1.04) is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.31 | ||
| Quick Ratio | 1.04 |
3. Growth
3.1 Past
- IP shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -101.27%.
- IP shows a very negative growth in Earnings Per Share. Measured over the last years, the EPS has been decreasing by -23.81% yearly.
- Looking at the last year, IP shows a very strong growth in Revenue. The Revenue has grown by 25.91%.
- The Revenue has been decreasing by -3.61% on average over the past years.
EPS 1Y (TTM)-101.27%
EPS 3Y-33.91%
EPS 5Y-23.81%
EPS Q2Q%-197.73%
Revenue 1Y (TTM)25.91%
Revenue growth 3Y-1.3%
Revenue growth 5Y-3.61%
Sales Q2Q%32.78%
3.2 Future
- Based on estimates for the next years, IP will show a very strong growth in Earnings Per Share. The EPS will grow by 26.74% on average per year.
- The Revenue is expected to grow by 7.44% on average over the next years.
EPS Next Y-78.72%
EPS Next 2Y34.3%
EPS Next 3Y38.69%
EPS Next 5Y26.74%
Revenue Next Year30.47%
Revenue Next 2Y14.39%
Revenue Next 3Y10.64%
Revenue Next 5Y7.44%
3.3 Evolution
- The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
- When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
- The Price/Earnings Ratio is negative for IP. In the last year negative earnings were reported.
- IP is valuated rather expensively with a Price/Forward Earnings ratio of 20.52.
- IP's Price/Forward Earnings ratio is a bit more expensive when compared to the industry. IP is more expensive than 68.18% of the companies in the same industry.
- Compared to an average S&P500 Price/Forward Earnings ratio of 25.96, IP is valued a bit cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | N/A | ||
| Fwd PE | 20.52 |
4.2 Price Multiples
- Based on the Enterprise Value to EBITDA ratio, IP is valued a bit more expensive than 72.73% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 13.42 |
4.3 Compensation for Growth
- IP's earnings are expected to grow with 38.69% in the coming years. This may justify a more expensive valuation.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y34.3%
EPS Next 3Y38.69%
5. Dividend
5.1 Amount
- IP has a Yearly Dividend Yield of 4.42%, which is a nice return.
- IP's Dividend Yield is rather good when compared to the industry average which is at 2.38. IP pays more dividend than 90.91% of the companies in the same industry.
- IP's Dividend Yield is rather good when compared to the S&P500 average which is at 1.82.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.42% |
5.2 History
- The dividend of IP decreases each year by -1.58%.
- IP has been paying a dividend for at least 10 years, so it has a reliable track record.
- The dividend of IP decreased in the last 3 years.
Dividend Growth(5Y)-1.58%
Div Incr Years0
Div Non Decr Years2
5.3 Sustainability
- The earnings of IP are negative and hence is the payout ratio. IP will probably not be able to sustain this dividend level.
DP-69.9%
EPS Next 2Y34.3%
EPS Next 3Y38.69%
INTERNATIONAL PAPER CO / IP FAQ
Can you provide the ChartMill fundamental rating for INTERNATIONAL PAPER CO?
ChartMill assigns a fundamental rating of 3 / 10 to IP.
What is the valuation status for IP stock?
ChartMill assigns a valuation rating of 1 / 10 to INTERNATIONAL PAPER CO (IP). This can be considered as Overvalued.
Can you provide the profitability details for INTERNATIONAL PAPER CO?
INTERNATIONAL PAPER CO (IP) has a profitability rating of 2 / 10.
What is the financial health of INTERNATIONAL PAPER CO (IP) stock?
The financial health rating of INTERNATIONAL PAPER CO (IP) is 3 / 10.
Can you provide the dividend sustainability for IP stock?
The dividend rating of INTERNATIONAL PAPER CO (IP) is 5 / 10 and the dividend payout ratio is -69.9%.