KBR INC (KBR) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:KBR - US48242W1062 - Common Stock
44.37 USD
-0.07 (-0.16%)
44.37 USD
0 (0%)
We assign a fundamental rating of 5 out of 10 to KBR. KBR was compared to 88 industry peers in the Professional Services industry. There are concerns on the financial health of KBR while its profitability can be described as average. KBR scores decently on growth, while it is valued quite cheap. This could make an interesting combination.
1. Profitability
1.1 Basic Checks
- In the past year KBR was profitable.
- KBR had a positive operating cash flow in the past year.
- The reported net income has been mixed in the past 5 years: KBR reported negative net income in multiple years.
- Each year in the past 5 years KBR had a positive operating cash flow.
1.2 Ratios
- KBR has a better Return On Assets (5.72%) than 63.64% of its industry peers.
- KBR has a Return On Equity of 25.96%. This is in the better half of the industry: KBR outperforms 78.41% of its industry peers.
- KBR has a better Return On Invested Capital (8.28%) than 62.50% of its industry peers.
- KBR had an Average Return On Invested Capital over the past 3 years of 8.52%. This is below the industry average of 11.85%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.72% | ||
| ROE | 25.96% | ||
| ROIC | 8.28% |
ROA(3y)1.42%
ROA(5y)0.72%
ROE(3y)6.1%
ROE(5y)3.19%
ROIC(3y)8.52%
ROIC(5y)7.69%
1.3 Margins
- With a decent Profit Margin value of 4.71%, KBR is doing good in the industry, outperforming 61.36% of the companies in the same industry.
- KBR's Profit Margin has improved in the last couple of years.
- KBR has a Operating Margin (6.72%) which is in line with its industry peers.
- KBR's Operating Margin has improved in the last couple of years.
- With a Gross Margin value of 14.28%, KBR is not doing good in the industry: 77.27% of the companies in the same industry are doing better.
- KBR's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 6.72% | ||
| PM (TTM) | 4.71% | ||
| GM | 14.28% |
OM growth 3Y7.95%
OM growth 5Y5.05%
PM growth 3Y136.13%
PM growth 5Y6.22%
GM growth 3Y9.06%
GM growth 5Y4.23%
2. Health
2.1 Basic Checks
- KBR has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
- The number of shares outstanding for KBR has been reduced compared to 1 year ago.
- KBR has less shares outstanding than it did 5 years ago.
- KBR has a worse debt/assets ratio than last year.
2.2 Solvency
- KBR has an Altman-Z score of 2.53. This is not the best score and indicates that KBR is in the grey zone with still only limited risk for bankruptcy at the moment.
- KBR has a Altman-Z score of 2.53. This is comparable to the rest of the industry: KBR outperforms 47.73% of its industry peers.
- KBR has a debt to FCF ratio of 5.59. This is a neutral value as KBR would need 5.59 years to pay back of all of its debts.
- KBR has a Debt to FCF ratio (5.59) which is in line with its industry peers.
- KBR has a Debt/Equity ratio of 1.75. This is a high value indicating a heavy dependency on external financing.
- With a Debt to Equity ratio value of 1.75, KBR is not doing good in the industry: 78.41% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.75 | ||
| Debt/FCF | 5.59 | ||
| Altman-Z | 2.53 |
ROIC/WACC1.05
WACC7.89%
2.3 Liquidity
- A Current Ratio of 1.18 indicates that KBR should not have too much problems paying its short term obligations.
- With a Current ratio value of 1.18, KBR is not doing good in the industry: 64.77% of the companies in the same industry are doing better.
- KBR has a Quick Ratio of 1.18. This is a normal value and indicates that KBR is financially healthy and should not expect problems in meeting its short term obligations.
- The Quick ratio of KBR (1.18) is worse than 64.77% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.18 | ||
| Quick Ratio | 1.18 |
3. Growth
3.1 Past
- The Earnings Per Share has grown by an impressive 22.04% over the past year.
- The Earnings Per Share has been growing by 14.80% on average over the past years. This is quite good.
- KBR shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 9.66%.
- The Revenue has been growing slightly by 6.54% on average over the past years.
EPS 1Y (TTM)22.04%
EPS 3Y11.91%
EPS 5Y14.8%
EPS Q2Q%21.43%
Revenue 1Y (TTM)9.66%
Revenue growth 3Y1.8%
Revenue growth 5Y6.54%
Sales Q2Q%-0.82%
3.2 Future
- Based on estimates for the next years, KBR will show a quite strong growth in Earnings Per Share. The EPS will grow by 16.31% on average per year.
- KBR is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 6.62% yearly.
EPS Next Y16.18%
EPS Next 2Y11.54%
EPS Next 3Y9.88%
EPS Next 5Y16.31%
Revenue Next Year2.97%
Revenue Next 2Y3.52%
Revenue Next 3Y4.03%
Revenue Next 5Y6.62%
3.3 Evolution
- The EPS growth rate is stable: in the next years the growth will be about the same 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 stable.
4. Valuation
4.1 Price/Earnings Ratio
- A Price/Earnings ratio of 11.62 indicates a reasonable valuation of KBR.
- 82.95% of the companies in the same industry are more expensive than KBR, based on the Price/Earnings ratio.
- The average S&P500 Price/Earnings ratio is at 27.21. KBR is valued rather cheaply when compared to this.
- A Price/Forward Earnings ratio of 10.65 indicates a reasonable valuation of KBR.
- Based on the Price/Forward Earnings ratio, KBR is valued cheaply inside the industry as 85.23% of the companies are valued more expensively.
- Compared to an average S&P500 Price/Forward Earnings ratio of 24.26, KBR is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 11.62 | ||
| Fwd PE | 10.65 |
4.2 Price Multiples
- Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of KBR indicates a somewhat cheap valuation: KBR is cheaper than 78.41% of the companies listed in the same industry.
- KBR's Price/Free Cash Flow ratio is rather cheap when compared to the industry. KBR is cheaper than 84.09% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 12.09 | ||
| EV/EBITDA | 10.78 |
4.3 Compensation for Growth
- KBR's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
- KBR has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)0.72
PEG (5Y)0.78
EPS Next 2Y11.54%
EPS Next 3Y9.88%
5. Dividend
5.1 Amount
- With a Yearly Dividend Yield of 1.49%, KBR has a reasonable but not impressive dividend return.
- KBR's Dividend Yield is a higher than the industry average which is at 1.43.
- Compared to an average S&P500 Dividend Yield of 1.81, KBR has a dividend comparable with the average S&P500 company.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.49% |
5.2 History
- KBR has been paying a dividend for at least 10 years, so it has a reliable track record.
- KBR has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)N/A
Div Incr Years5
Div Non Decr Years16
5.3 Sustainability
- KBR pays out 21.84% of its income as dividend. This is a sustainable payout ratio.
DP21.84%
EPS Next 2Y11.54%
EPS Next 3Y9.88%
KBR INC / KBR FAQ
Can you provide the ChartMill fundamental rating for KBR INC?
ChartMill assigns a fundamental rating of 5 / 10 to KBR.
What is the valuation status for KBR stock?
ChartMill assigns a valuation rating of 8 / 10 to KBR INC (KBR). This can be considered as Undervalued.
What is the profitability of KBR stock?
KBR INC (KBR) has a profitability rating of 6 / 10.
What is the financial health of KBR INC (KBR) stock?
The financial health rating of KBR INC (KBR) is 3 / 10.
How sustainable is the dividend of KBR INC (KBR) stock?
The dividend rating of KBR INC (KBR) is 5 / 10 and the dividend payout ratio is 21.84%.