PENNYMAC FINANCIAL SERVICES (PFSI) Stock Fundamental Analysis
USA - NYSE:PFSI - US70932M1071 - Common Stock
117.11 USD
+2.54 (+2.22%)
117.11 USD
0 (0%)
We assign a fundamental rating of 4 out of 10 to PFSI. PFSI was compared to 99 industry peers in the Financial Services industry. PFSI may be in some trouble as it scores bad on both profitability and health. PFSI is not priced too expensively while it is growing strongly. Keep and eye on this one!
1. Profitability
1.1 Basic Checks
PFSI had positive earnings in the past year.
In the past year PFSI has reported a negative cash flow from operations.
In the past 5 years PFSI has always been profitable.
In multiple years PFSI reported negative operating cash flow during the last 5 years.
1.2 Ratios
PFSI has a Return On Assets (1.60%) which is comparable to the rest of the industry.
PFSI has a Return On Equity (9.59%) which is comparable to the rest of the industry.
PFSI has a Return On Invested Capital (1.41%) which is in line with its industry peers.
PFSI had an Average Return On Invested Capital over the past 3 years of 2.11%. This is significantly below the industry average of 7.66%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.6% | ||
| ROE | 9.59% | ||
| ROIC | 1.41% |
ROA(3y)1.6%
ROA(5y)3.07%
ROE(3y)8.64%
ROE(5y)20.77%
ROIC(3y)2.11%
ROIC(5y)3.65%
1.3 Margins
PFSI has a better Profit Margin (14.58%) than 62.63% of its industry peers.
In the last couple of years the Profit Margin of PFSI has declined.
PFSI has a Operating Margin (15.30%) which is comparable to the rest of the industry.
In the last couple of years the Operating Margin of PFSI has declined.
The Gross Margin of PFSI (66.30%) is better than 78.79% of its industry peers.
PFSI's Gross Margin has declined in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 15.3% | ||
| PM (TTM) | 14.58% | ||
| GM | 66.3% |
OM growth 3Y-24.13%
OM growth 5Y-11.84%
PM growth 3Y-22.94%
PM growth 5Y-11.12%
GM growth 3Y-9.47%
GM growth 5Y-5.46%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), PFSI is destroying value.
PFSI has more shares outstanding than it did 1 year ago.
The number of shares outstanding for PFSI has been reduced compared to 5 years ago.
Compared to 1 year ago, PFSI has a worse debt to assets ratio.
2.2 Solvency
Based on the Altman-Z score of 0.10, we must say that PFSI is in the distress zone and has some risk of bankruptcy.
PFSI has a Altman-Z score of 0.10. This is comparable to the rest of the industry: PFSI outperforms 40.40% of its industry peers.
PFSI has a Debt/Equity ratio of 3.34. This is a high value indicating a heavy dependency on external financing.
PFSI has a worse Debt to Equity ratio (3.34) than 76.77% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 3.34 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 0.1 |
ROIC/WACC0.22
WACC6.55%
2.3 Liquidity
A Current Ratio of 0.02 indicates that PFSI may have some problems paying its short term obligations.
The Current ratio of PFSI (0.02) is worse than 83.84% of its industry peers.
PFSI has a Quick Ratio of 0.02. This is a bad value and indicates that PFSI is not financially healthy enough and could expect problems in meeting its short term obligations.
PFSI has a Quick ratio of 0.02. This is amonst the worse of the industry: PFSI underperforms 83.84% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.02 | ||
| Quick Ratio | 0.02 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 34.51% over the past year.
PFSI shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 9.16% yearly.
The Revenue has grown by 21.88% in the past year. This is a very strong growth!
Measured over the past years, PFSI shows a small growth in Revenue. The Revenue has been growing by 7.39% on average per year.
EPS 1Y (TTM)34.51%
EPS 3Y-19.77%
EPS 5Y9.16%
EPS Q2Q%37.3%
Revenue 1Y (TTM)21.88%
Revenue growth 3Y-12.14%
Revenue growth 5Y7.39%
Sales Q2Q%9.51%
3.2 Future
PFSI is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 31.62% yearly.
PFSI is expected to show a strong growth in Revenue. In the coming years, the Revenue will grow by 20.23% yearly.
EPS Next Y34.92%
EPS Next 2Y39.81%
EPS Next 3Y31.62%
EPS Next 5YN/A
Revenue Next Year29.24%
Revenue Next 2Y26.36%
Revenue Next 3Y20.23%
Revenue Next 5YN/A
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
The Price/Earnings ratio is 16.24, which indicates a correct valuation of PFSI.
Compared to the rest of the industry, the Price/Earnings ratio of PFSI is on the same level as its industry peers.
PFSI is valuated rather cheaply when we compare the Price/Earnings ratio to 27.02, which is the current average of the S&P500 Index.
A Price/Forward Earnings ratio of 7.90 indicates a rather cheap valuation of PFSI.
Compared to the rest of the industry, the Price/Forward Earnings ratio of PFSI indicates a somewhat cheap valuation: PFSI is cheaper than 70.71% of the companies listed in the same industry.
PFSI's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 22.57.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 16.24 | ||
| Fwd PE | 7.9 |
4.2 Price Multiples
The rest of the industry has a similar Enterprise Value to EBITDA ratio as PFSI.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 24.78 |
4.3 Compensation for Growth
PFSI's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
A more expensive valuation may be justified as PFSI's earnings are expected to grow with 31.62% in the coming years.
PEG (NY)0.47
PEG (5Y)1.77
EPS Next 2Y39.81%
EPS Next 3Y31.62%
5. Dividend
5.1 Amount
PFSI has a Yearly Dividend Yield of 1.05%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 5.03, PFSI has a dividend in line with its industry peers.
Compared to an average S&P500 Dividend Yield of 2.44, PFSI's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.05% |
5.2 History
On average, the dividend of PFSI grows each year by 52.53%, which is quite nice.
PFSI has been paying a dividend for over 5 years, so it has already some track record.
PFSI has decreased its dividend in the last 3 years.
Dividend Growth(5Y)52.53%
Div Incr Years1
Div Non Decr Years2
5.3 Sustainability
16.08% of the earnings are spent on dividend by PFSI. This is a low number and sustainable payout ratio.
The dividend of PFSI is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP16.08%
EPS Next 2Y39.81%
EPS Next 3Y31.62%
117.11
+2.54 (+2.22%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupFinancial Services
GICS IndustryFinancial Services
Earnings (Last)
Earnings (Next)
Inst Owners60.52%
Inst Owner Change-0.01%
Ins Owners4.71%
Ins Owner Change-0.24%
Market Cap6.06B
Analysts80
Price Target124.73 (6.51%)
Short Float %5.71%
Short Ratio4.45
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.05% |
Yearly Dividend1.03
Dividend Growth(5Y)52.53%
DP16.08%
Div Incr Years1
Div Non Decr Years2
Ex-Date
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-31.14%
Min EPS beat(2)-49.34%
Max EPS beat(2)-12.94%
EPS beat(4)0
Avg EPS beat(4)-39.28%
Min EPS beat(4)-56.05%
Max EPS beat(4)-12.94%
EPS beat(8)2
Avg EPS beat(8)-40.93%
EPS beat(12)3
Avg EPS beat(12)-26.91%
EPS beat(16)6
Avg EPS beat(16)-13.72%
Revenue beat(2)0
Avg Revenue beat(2)-21.13%
Min Revenue beat(2)-21.27%
Max Revenue beat(2)-20.99%
Revenue beat(4)0
Avg Revenue beat(4)-18.77%
Min Revenue beat(4)-21.27%
Max Revenue beat(4)-11.77%
Revenue beat(8)0
Avg Revenue beat(8)-17.07%
Revenue beat(12)2
Avg Revenue beat(12)-9.01%
Revenue beat(16)6
Avg Revenue beat(16)-4.29%
PT rev (1m)0.47%
PT rev (3m)-1.88%
EPS NQ rev (1m)0.22%
EPS NQ rev (3m)-8.91%
EPS NY rev (1m)6.64%
EPS NY rev (3m)-9.16%
Revenue NQ rev (1m)0.12%
Revenue NQ rev (3m)0.25%
Revenue NY rev (1m)2.07%
Revenue NY rev (3m)-2.87%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 16.24 | ||
| Fwd PE | 7.9 | ||
| P/S | 2.28 | ||
| P/FCF | N/A | ||
| P/OCF | N/A | ||
| P/B | 1.5 | ||
| P/tB | N/A | ||
| EV/EBITDA | 24.78 |
EPS(TTM)7.21
EY6.16%
EPS(NY)14.82
Fwd EY12.65%
FCF(TTM)-31.67
FCFYN/A
OCF(TTM)-31.09
OCFYN/A
SpS51.27
BVpS77.98
TBVpS-108.51
PEG (NY)0.47
PEG (5Y)1.77
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.6% | ||
| ROE | 9.59% | ||
| ROCE | 2.8% | ||
| ROIC | 1.41% | ||
| ROICexc | 1.42% | ||
| ROICexgc | 4.79% | ||
| OM | 15.3% | ||
| PM (TTM) | 14.58% | ||
| GM | 66.3% | ||
| FCFM | N/A |
ROA(3y)1.6%
ROA(5y)3.07%
ROE(3y)8.64%
ROE(5y)20.77%
ROIC(3y)2.11%
ROIC(5y)3.65%
ROICexc(3y)2.25%
ROICexc(5y)3.78%
ROICexgc(3y)12.97%
ROICexgc(5y)13.6%
ROCE(3y)3.67%
ROCE(5y)7.27%
ROICexcg growth 3Y-29.91%
ROICexcg growth 5Y-15.06%
ROICexc growth 3Y-40.19%
ROICexc growth 5Y-21.68%
OM growth 3Y-24.13%
OM growth 5Y-11.84%
PM growth 3Y-22.94%
PM growth 5Y-11.12%
GM growth 3Y-9.47%
GM growth 5Y-5.46%
F-Score4
Asset Turnover0.11
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 3.34 | ||
| Debt/FCF | N/A | ||
| Debt/EBITDA | 29.58 | ||
| Cap/Depr | 60.98% | ||
| Cap/Sales | 1.13% | ||
| Interest Coverage | 0.46 | ||
| Cash Conversion | N/A | ||
| Profit Quality | N/A | ||
| Current Ratio | 0.02 | ||
| Quick Ratio | 0.02 | ||
| Altman-Z | 0.1 |
F-Score4
WACC6.55%
ROIC/WACC0.22
Cap/Depr(3y)116.34%
Cap/Depr(5y)175.37%
Cap/Sales(3y)2.09%
Cap/Sales(5y)2%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)34.51%
EPS 3Y-19.77%
EPS 5Y9.16%
EPS Q2Q%37.3%
EPS Next Y34.92%
EPS Next 2Y39.81%
EPS Next 3Y31.62%
EPS Next 5YN/A
Revenue 1Y (TTM)21.88%
Revenue growth 3Y-12.14%
Revenue growth 5Y7.39%
Sales Q2Q%9.51%
Revenue Next Year29.24%
Revenue Next 2Y26.36%
Revenue Next 3Y20.23%
Revenue Next 5YN/A
EBIT growth 1Y-2.15%
EBIT growth 3Y-33.34%
EBIT growth 5Y-5.32%
EBIT Next Year87.51%
EBIT Next 3Y41.46%
EBIT Next 5YN/A
FCF growth 1Y-37.12%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y-41.67%
OCF growth 3YN/A
OCF growth 5YN/A