RIO TINTO PLC-SPON ADR (RIO) Stock Fundamental Analysis
NYSE:RIO - New York Stock Exchange, Inc. - US7672041008 - ADR - Currency: USD
Taking everything into account, RIO scores 5 out of 10 in our fundamental rating. RIO was compared to 153 industry peers in the Metals & Mining industry. RIO scores excellent on profitability, but there are some minor concerns on its financial health. RIO is valued quite cheap, but it does not seem to be growing. This makes RIO very considerable for value investing!
1. Profitability
1.1 Basic Checks
In the past year RIO was profitable.
In the past year RIO had a positive cash flow from operations.
Each year in the past 5 years RIO has been profitable.
Each year in the past 5 years RIO had a positive operating cash flow.
1.2 Ratios
RIO has a better Return On Assets (11.24%) than 90.20% of its industry peers.
The Return On Equity of RIO (20.91%) is better than 90.85% of its industry peers.
RIO has a better Return On Invested Capital (12.04%) than 92.81% of its industry peers.
RIO had an Average Return On Invested Capital over the past 3 years of 14.66%. This is significantly above the industry average of 8.56%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 11.24% | ||
| ROE | 20.91% | ||
| ROIC | 12.04% |
ROA(3y)11.25%
ROA(5y)12.86%
ROE(3y)21.27%
ROE(5y)25.13%
ROIC(3y)14.66%
ROIC(5y)17.06%
1.3 Margins
Looking at the Profit Margin, with a value of 21.53%, RIO belongs to the top of the industry, outperforming 90.20% of the companies in the same industry.
RIO's Profit Margin has improved in the last couple of years.
RIO has a Operating Margin of 27.91%. This is amongst the best in the industry. RIO outperforms 83.66% of its industry peers.
RIO's Operating Margin has declined in the last couple of years.
Looking at the Gross Margin, with a value of 47.66%, RIO belongs to the top of the industry, outperforming 87.58% of the companies in the same industry.
RIO's Gross Margin has declined in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 27.91% | ||
| PM (TTM) | 21.53% | ||
| GM | 47.66% |
OM growth 3Y-15.69%
OM growth 5Y-5.08%
PM growth 3Y-13.49%
PM growth 5Y3.02%
GM growth 3Y-9.8%
GM growth 5Y-2.74%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), RIO is creating some value.
Compared to 1 year ago, RIO has about the same amount of shares outstanding.
Compared to 5 years ago, RIO has about the same amount of shares outstanding.
The debt/assets ratio for RIO has been reduced compared to a year ago.
2.2 Solvency
An Altman-Z score of 2.96 indicates that RIO is not a great score, but indicates only limited risk for bankruptcy at the moment.
RIO has a Altman-Z score of 2.96. This is comparable to the rest of the industry: RIO outperforms 58.82% of its industry peers.
RIO has a debt to FCF ratio of 2.32. This is a good value and a sign of high solvency as RIO would need 2.32 years to pay back of all of its debts.
RIO's Debt to FCF ratio of 2.32 is amongst the best of the industry. RIO outperforms 81.05% of its industry peers.
A Debt/Equity ratio of 0.24 indicates that RIO is not too dependend on debt financing.
RIO has a Debt to Equity ratio (0.24) which is in line with its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.24 | ||
| Debt/FCF | 2.32 | ||
| Altman-Z | 2.96 |
ROIC/WACC1.17
WACC10.27%
2.3 Liquidity
RIO has a Current Ratio of 1.63. This is a normal value and indicates that RIO is financially healthy and should not expect problems in meeting its short term obligations.
With a Current ratio value of 1.63, RIO is not doing good in the industry: 66.67% of the companies in the same industry are doing better.
RIO has a Quick Ratio of 1.13. This is a normal value and indicates that RIO is financially healthy and should not expect problems in meeting its short term obligations.
RIO's Quick ratio of 1.13 is on the low side compared to the rest of the industry. RIO is outperformed by 60.78% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.63 | ||
| Quick Ratio | 1.13 |
3. Growth
3.1 Past
RIO shows a slight negative growth in Earnings Per Share. In the last year, the EPS has decreased by -7.54%.
The Earnings Per Share has been growing slightly by 1.06% on average over the past years.
RIO shows a decrease in Revenue. In the last year, the revenue decreased by -0.71%.
RIO shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 4.45% yearly.
EPS 1Y (TTM)-7.54%
EPS 3Y-20.07%
EPS 5Y1.06%
EPS Q2Q%-15.08%
Revenue 1Y (TTM)-0.71%
Revenue growth 3Y-5.46%
Revenue growth 5Y4.45%
Sales Q2Q%-1.89%
3.2 Future
RIO is expected to show a decrease in Earnings Per Share. In the coming years, the EPS will decrease by -3.77% yearly.
RIO is expected to show a decrease in Revenue. In the coming years, the Revenue will decrease by -3.00% yearly.
EPS Next Y-2.67%
EPS Next 2Y-1.44%
EPS Next 3Y1.03%
EPS Next 5Y-3.77%
Revenue Next Year-2.55%
Revenue Next 2Y0.63%
Revenue Next 3Y1.67%
Revenue Next 5Y-3%
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 8.91 indicates a reasonable valuation of RIO.
98.04% of the companies in the same industry are more expensive than RIO, based on the Price/Earnings ratio.
When comparing the Price/Earnings ratio of RIO to the average of the S&P500 Index (23.99), we can say RIO is valued rather cheaply.
Based on the Price/Forward Earnings ratio of 9.14, the valuation of RIO can be described as reasonable.
Based on the Price/Forward Earnings ratio, RIO is valued cheaper than 85.62% of the companies in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 20.35. RIO is valued rather cheaply when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 8.91 | ||
| Fwd PE | 9.14 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, RIO is valued cheaply inside the industry as 89.54% of the companies are valued more expensively.
RIO's Price/Free Cash Flow ratio is rather cheap when compared to the industry. RIO is cheaper than 82.35% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 16.31 | ||
| EV/EBITDA | 4.87 |
4.3 Compensation for Growth
RIO has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)8.43
EPS Next 2Y-1.44%
EPS Next 3Y1.03%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 7.00%, RIO is a good candidate for dividend investing.
RIO's Dividend Yield is rather good when compared to the industry average which is at 2.94. RIO pays more dividend than 96.73% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 2.44, RIO pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 7% |
5.2 History
The dividend of RIO decreases each year by -7.29%.
RIO has been paying a dividend for at least 10 years, so it has a reliable track record.
RIO has decreased its dividend recently.
Dividend Growth(5Y)-7.29%
Div Incr Years1
Div Non Decr Years1
5.3 Sustainability
RIO pays out 60.81% of its income as dividend. This is not a sustainable payout ratio.
RIO's earnings and Dividend Rate are declining. This means the current dividend is most likely not sustainable.
DP60.81%
EPS Next 2Y-1.44%
EPS Next 3Y1.03%
60.02
+0.22 (+0.37%)
Chartmill FA Rating
GICS SectorMaterials
GICS IndustryGroupMaterials
GICS IndustryMetals & Mining
Earnings (Last)
Earnings (Next)
Inst Owners49.48%
Inst Owner Change0.07%
Ins Owners0.03%
Ins Owner ChangeN/A
Market Cap97.51B
Analysts79.33
Price Target77.92 (29.82%)
Short Float %0.61%
Short Ratio1.86
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 7% |
Yearly Dividend4.33
Dividend Growth(5Y)-7.29%
DP60.81%
Div Incr Years1
Div Non Decr Years1
Ex-Date
Surprises & Revisions
EPS beat(2)N/A
Avg EPS beat(2)N/A
Min EPS beat(2)N/A
Max EPS beat(2)N/A
EPS beat(4)N/A
Avg EPS beat(4)N/A
Min EPS beat(4)N/A
Max EPS beat(4)N/A
EPS beat(8)N/A
Avg EPS beat(8)N/A
EPS beat(12)N/A
Avg EPS beat(12)N/A
EPS beat(16)N/A
Avg EPS beat(16)N/A
Revenue beat(2)N/A
Avg Revenue beat(2)N/A
Min Revenue beat(2)N/A
Max Revenue beat(2)N/A
Revenue beat(4)N/A
Avg Revenue beat(4)N/A
Min Revenue beat(4)N/A
Max Revenue beat(4)N/A
Revenue beat(8)N/A
Avg Revenue beat(8)N/A
Revenue beat(12)N/A
Avg Revenue beat(12)N/A
Revenue beat(16)N/A
Avg Revenue beat(16)N/A
PT rev (1m)0.45%
PT rev (3m)1.05%
EPS NQ rev (1m)N/A
EPS NQ rev (3m)N/A
EPS NY rev (1m)-2.65%
EPS NY rev (3m)-5.34%
Revenue NQ rev (1m)N/A
Revenue NQ rev (3m)N/A
Revenue NY rev (1m)-0.38%
Revenue NY rev (3m)-0.47%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 8.91 | ||
| Fwd PE | 9.14 | ||
| P/S | 1.82 | ||
| P/FCF | 16.31 | ||
| P/OCF | 6.25 | ||
| P/B | 1.77 | ||
| P/tB | 1.89 | ||
| EV/EBITDA | 4.87 |
EPS(TTM)6.74
EY11.23%
EPS(NY)6.56
Fwd EY10.94%
FCF(TTM)3.68
FCFY6.13%
OCF(TTM)9.6
OCFY16%
SpS33.03
BVpS34
TBVpS31.83
PEG (NY)N/A
PEG (5Y)8.43
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 11.24% | ||
| ROE | 20.91% | ||
| ROCE | 16.45% | ||
| ROIC | 12.04% | ||
| ROICexc | 13.34% | ||
| ROICexgc | 13.94% | ||
| OM | 27.91% | ||
| PM (TTM) | 21.53% | ||
| GM | 47.66% | ||
| FCFM | 11.14% |
ROA(3y)11.25%
ROA(5y)12.86%
ROE(3y)21.27%
ROE(5y)25.13%
ROIC(3y)14.66%
ROIC(5y)17.06%
ROICexc(3y)16.42%
ROICexc(5y)19.71%
ROICexgc(3y)17.39%
ROICexgc(5y)20.82%
ROCE(3y)20.04%
ROCE(5y)23.31%
ROICexcg growth 3Y-22.87%
ROICexcg growth 5Y-5.32%
ROICexc growth 3Y-22.69%
ROICexc growth 5Y-5.1%
OM growth 3Y-15.69%
OM growth 5Y-5.08%
PM growth 3Y-13.49%
PM growth 5Y3.02%
GM growth 3Y-9.8%
GM growth 5Y-2.74%
F-Score5
Asset Turnover0.52
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.24 | ||
| Debt/FCF | 2.32 | ||
| Debt/EBITDA | 0.64 | ||
| Cap/Depr | 162.57% | ||
| Cap/Sales | 17.93% | ||
| Interest Coverage | 21.86 | ||
| Cash Conversion | 74.65% | ||
| Profit Quality | 51.75% | ||
| Current Ratio | 1.63 | ||
| Quick Ratio | 1.13 | ||
| Altman-Z | 2.96 |
F-Score5
WACC10.27%
ROIC/WACC1.17
Cap/Depr(3y)143.38%
Cap/Depr(5y)146.4%
Cap/Sales(3y)14.4%
Cap/Sales(5y)13.74%
Profit Quality(3y)69.25%
Profit Quality(5y)78.39%
High Growth Momentum
Growth
EPS 1Y (TTM)-7.54%
EPS 3Y-20.07%
EPS 5Y1.06%
EPS Q2Q%-15.08%
EPS Next Y-2.67%
EPS Next 2Y-1.44%
EPS Next 3Y1.03%
EPS Next 5Y-3.77%
Revenue 1Y (TTM)-0.71%
Revenue growth 3Y-5.46%
Revenue growth 5Y4.45%
Sales Q2Q%-1.89%
Revenue Next Year-2.55%
Revenue Next 2Y0.63%
Revenue Next 3Y1.67%
Revenue Next 5Y-3%
EBIT growth 1Y-4.96%
EBIT growth 3Y-20.29%
EBIT growth 5Y-0.86%
EBIT Next Year38.52%
EBIT Next 3Y14.72%
EBIT Next 5Y4.02%
FCF growth 1Y-25.96%
FCF growth 3Y-30.7%
FCF growth 5Y-8.7%
OCF growth 1Y2.9%
OCF growth 3Y-14.94%
OCF growth 5Y0.9%