REGIONAL MANAGEMENT CORP (RM) Stock Fundamental Analysis
NYSE:RM - New York Stock Exchange, Inc. - US75902K1060 - Common Stock - Currency: USD
Taking everything into account, RM scores 5 out of 10 in our fundamental rating. RM was compared to 52 industry peers in the Consumer Finance industry. While RM is still in line with the averages on profitability rating, there are concerns on its financial health. RM may be a bit undervalued, certainly considering the very reasonable score on growth
1. Profitability
1.1 Basic Checks
RM had positive earnings in the past year.
RM had a positive operating cash flow in the past year.
Each year in the past 5 years RM has been profitable.
RM had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
RM has a Return On Assets of 1.74%. This is comparable to the rest of the industry: RM outperforms 48.08% of its industry peers.
With a Return On Equity value of 9.23%, RM perfoms like the industry average, outperforming 50.00% of the companies in the same industry.
RM has a Return On Invested Capital of 5.03%. This is in the better half of the industry: RM outperforms 63.46% of its industry peers.
The Average Return On Invested Capital over the past 3 years for RM is below the industry average of 10.31%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.74% | ||
| ROE | 9.23% | ||
| ROIC | 5.03% |
ROA(3y)2.01%
ROA(5y)2.9%
ROE(3y)11.03%
ROE(5y)14.86%
ROIC(3y)5.39%
ROIC(5y)6.19%
1.3 Margins
Looking at the Profit Margin, with a value of 5.53%, RM is doing worse than 67.31% of the companies in the same industry.
In the last couple of years the Profit Margin of RM has declined.
Looking at the Operating Margin, with a value of 20.11%, RM is in the better half of the industry, outperforming 69.23% of the companies in the same industry.
RM's Operating Margin has declined in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 20.11% | ||
| PM (TTM) | 5.53% | ||
| GM | N/A |
OM growth 3Y-9.85%
OM growth 5Y-4.74%
PM growth 3Y-30.32%
PM growth 5Y-11.03%
GM growth 3YN/A
GM growth 5YN/A
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), RM is destroying value.
RM has more shares outstanding than it did 1 year ago.
The number of shares outstanding for RM has been reduced compared to 5 years ago.
The debt/assets ratio for RM has been reduced compared to a year ago.
2.2 Solvency
RM has an Altman-Z score of 0.89. This is a bad value and indicates that RM is not financially healthy and even has some risk of bankruptcy.
The Altman-Z score of RM (0.89) is better than 61.54% of its industry peers.
RM has a debt to FCF ratio of 5.74. This is a neutral value as RM would need 5.74 years to pay back of all of its debts.
With a decent Debt to FCF ratio value of 5.74, RM is doing good in the industry, outperforming 61.54% of the companies in the same industry.
A Debt/Equity ratio of 4.11 is on the high side and indicates that RM has dependencies on debt financing.
Looking at the Debt to Equity ratio, with a value of 4.11, RM is doing worse than 63.46% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 4.11 | ||
| Debt/FCF | 5.74 | ||
| Altman-Z | 0.89 |
ROIC/WACC0.84
WACC5.95%
2.3 Liquidity
RM has a Current Ratio of 0.06. This is a bad value and indicates that RM is not financially healthy enough and could expect problems in meeting its short term obligations.
Looking at the Current ratio, with a value of 0.06, RM is doing worse than 82.69% of the companies in the same industry.
RM has a Quick Ratio of 0.06. This is a bad value and indicates that RM is not financially healthy enough and could expect problems in meeting its short term obligations.
RM has a Quick ratio of 0.06. This is amonst the worse of the industry: RM underperforms 82.69% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.06 | ||
| Quick Ratio | 0.06 |
3. Growth
3.1 Past
RM shows a slight negative growth in Earnings Per Share. In the last year, the EPS has decreased by -9.34%.
Measured over the past 5 years, RM shows a small growth in Earnings Per Share. The EPS has been growing by 1.67% on average per year.
The Revenue has been growing slightly by 6.57% in the past year.
Measured over the past years, RM shows a quite strong growth in Revenue. The Revenue has been growing by 10.59% on average per year.
EPS 1Y (TTM)-9.34%
EPS 3Y-20.66%
EPS 5Y1.67%
EPS Q2Q%-55.13%
Revenue 1Y (TTM)6.57%
Revenue growth 3Y11.16%
Revenue growth 5Y10.59%
Sales Q2Q%6%
3.2 Future
Based on estimates for the next years, RM will show a very strong growth in Earnings Per Share. The EPS will grow by 42.80% on average per year.
RM is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 3.56% yearly.
EPS Next Y8.08%
EPS Next 2Y27.15%
EPS Next 3Y42.8%
EPS Next 5YN/A
Revenue Next Year6.4%
Revenue Next 2Y7.87%
Revenue Next 3Y3.56%
Revenue Next 5YN/A
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 accelerating.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 9.80, the valuation of RM can be described as reasonable.
Based on the Price/Earnings ratio, RM is valued a bit cheaper than 65.38% of the companies in the same industry.
The average S&P500 Price/Earnings ratio is at 27.30. RM is valued rather cheaply when compared to this.
A Price/Forward Earnings ratio of 4.81 indicates a rather cheap valuation of RM.
84.62% of the companies in the same industry are more expensive than RM, based on the Price/Forward Earnings ratio.
RM is valuated cheaply when we compare the Price/Forward Earnings ratio to 21.76, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.8 | ||
| Fwd PE | 4.81 |
4.2 Price Multiples
61.54% of the companies in the same industry are more expensive than RM, based on the Enterprise Value to EBITDA ratio.
Based on the Price/Free Cash Flow ratio, RM is valued cheaper than 90.38% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 1.25 | ||
| EV/EBITDA | 13.38 |
4.3 Compensation for Growth
The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
RM's earnings are expected to grow with 42.80% in the coming years. This may justify a more expensive valuation.
PEG (NY)1.21
PEG (5Y)5.88
EPS Next 2Y27.15%
EPS Next 3Y42.8%
5. Dividend
5.1 Amount
RM has a Yearly Dividend Yield of 3.60%.
RM's Dividend Yield is rather good when compared to the industry average which is at 3.53. RM pays more dividend than 80.77% of the companies in the same industry.
RM's Dividend Yield is rather good when compared to the S&P500 average which is at 2.35.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.6% |
5.2 History
RM has been paying a dividend for over 5 years, so it has already some track record.
RM has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)N/A
Div Incr Years0
Div Non Decr Years4
5.3 Sustainability
36.45% of the earnings are spent on dividend by RM. This is a low number and sustainable payout ratio.
DP36.45%
EPS Next 2Y27.15%
EPS Next 3Y42.8%
32.35
-0.95 (-2.85%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupFinancial Services
GICS IndustryConsumer Finance
Earnings (Last)
Earnings (Next)
Inst Owners85.71%
Inst Owner Change0%
Ins Owners8.95%
Ins Owner Change4.5%
Market Cap320.91M
Analysts80
Price Target39.53 (22.19%)
Short Float %2.55%
Short Ratio4.7
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.6% |
Yearly Dividend1.23
Dividend Growth(5Y)N/A
DP36.45%
Div Incr Years0
Div Non Decr Years4
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-0.11%
Min EPS beat(2)-7.33%
Max EPS beat(2)7.11%
EPS beat(4)2
Avg EPS beat(4)4.26%
Min EPS beat(4)-29.73%
Max EPS beat(4)47%
EPS beat(8)6
Avg EPS beat(8)17.56%
EPS beat(12)9
Avg EPS beat(12)13.9%
EPS beat(16)13
Avg EPS beat(16)16.86%
Revenue beat(2)0
Avg Revenue beat(2)-1.03%
Min Revenue beat(2)-1.69%
Max Revenue beat(2)-0.36%
Revenue beat(4)1
Avg Revenue beat(4)-0.87%
Min Revenue beat(4)-1.69%
Max Revenue beat(4)0.16%
Revenue beat(8)2
Avg Revenue beat(8)-1.29%
Revenue beat(12)3
Avg Revenue beat(12)-1.36%
Revenue beat(16)6
Avg Revenue beat(16)-0.6%
PT rev (1m)0%
PT rev (3m)-4.32%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-38.3%
EPS NY rev (1m)0%
EPS NY rev (3m)-13.54%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-1.9%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-1.18%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.8 | ||
| Fwd PE | 4.81 | ||
| P/S | 0.54 | ||
| P/FCF | 1.25 | ||
| P/OCF | 1.17 | ||
| P/B | 0.9 | ||
| P/tB | 0.97 | ||
| EV/EBITDA | 13.38 |
EPS(TTM)3.3
EY10.2%
EPS(NY)6.73
Fwd EY20.79%
FCF(TTM)25.79
FCFY79.74%
OCF(TTM)27.63
OCFY85.42%
SpS60.2
BVpS36.08
TBVpS33.38
PEG (NY)1.21
PEG (5Y)5.88
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.74% | ||
| ROE | 9.23% | ||
| ROCE | 6.57% | ||
| ROIC | 5.03% | ||
| ROICexc | 5.04% | ||
| ROICexgc | 5.17% | ||
| OM | 20.11% | ||
| PM (TTM) | 5.53% | ||
| GM | N/A | ||
| FCFM | 42.85% |
ROA(3y)2.01%
ROA(5y)2.9%
ROE(3y)11.03%
ROE(5y)14.86%
ROIC(3y)5.39%
ROIC(5y)6.19%
ROICexc(3y)5.4%
ROICexc(5y)6.22%
ROICexgc(3y)5.53%
ROICexgc(5y)6.35%
ROCE(3y)7.04%
ROCE(5y)8.09%
ROICexcg growth 3Y0.96%
ROICexcg growth 5Y1.31%
ROICexc growth 3Y0.47%
ROICexc growth 5Y0.98%
OM growth 3Y-9.85%
OM growth 5Y-4.74%
PM growth 3Y-30.32%
PM growth 5Y-11.03%
GM growth 3YN/A
GM growth 5YN/A
F-Score5
Asset Turnover0.31
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 4.11 | ||
| Debt/FCF | 5.74 | ||
| Debt/EBITDA | 10.95 | ||
| Cap/Depr | 128.68% | ||
| Cap/Sales | 3.05% | ||
| Interest Coverage | 1.67 | ||
| Cash Conversion | 204.15% | ||
| Profit Quality | 774.71% | ||
| Current Ratio | 0.06 | ||
| Quick Ratio | 0.06 | ||
| Altman-Z | 0.89 |
F-Score5
WACC5.95%
ROIC/WACC0.84
Cap/Depr(3y)98.62%
Cap/Depr(5y)79.09%
Cap/Sales(3y)2.46%
Cap/Sales(5y)2.09%
Profit Quality(3y)837.23%
Profit Quality(5y)662.95%
High Growth Momentum
Growth
EPS 1Y (TTM)-9.34%
EPS 3Y-20.66%
EPS 5Y1.67%
EPS Q2Q%-55.13%
EPS Next Y8.08%
EPS Next 2Y27.15%
EPS Next 3Y42.8%
EPS Next 5YN/A
Revenue 1Y (TTM)6.57%
Revenue growth 3Y11.16%
Revenue growth 5Y10.59%
Sales Q2Q%6%
Revenue Next Year6.4%
Revenue Next 2Y7.87%
Revenue Next 3Y3.56%
Revenue Next 5YN/A
EBIT growth 1Y23.54%
EBIT growth 3Y0.21%
EBIT growth 5Y5.35%
EBIT Next Year-23.97%
EBIT Next 3YN/A
EBIT Next 5YN/A
FCF growth 1Y17.32%
FCF growth 3Y11.37%
FCF growth 5Y10.77%
OCF growth 1Y18.62%
OCF growth 3Y12.48%
OCF growth 5Y11.2%