RPM INTERNATIONAL INC (RPM) Stock Fundamental Analysis
NYSE:RPM - New York Stock Exchange, Inc. - US7496851038 - Common Stock - Currency: USD
We assign a fundamental rating of 6 out of 10 to RPM. RPM was compared to 85 industry peers in the Chemicals industry. Both the health and profitability get an excellent rating, making RPM a very profitable company, without any liquidiy or solvency issues. RPM has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
In the past year RPM was profitable.
In the past year RPM had a positive cash flow from operations.
RPM had positive earnings in each of the past 5 years.
RPM had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
With an excellent Return On Assets value of 9.68%, RPM belongs to the best of the industry, outperforming 94.12% of the companies in the same industry.
RPM has a better Return On Equity (23.96%) than 94.12% of its industry peers.
With an excellent Return On Invested Capital value of 12.27%, RPM belongs to the best of the industry, outperforming 90.59% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for RPM is above the industry average of 6.83%.
The last Return On Invested Capital (12.27%) for RPM is above the 3 year average (11.40%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 9.68% | ||
| ROE | 23.96% | ||
| ROIC | 12.27% |
ROA(3y)7.73%
ROA(5y)7.31%
ROE(3y)23.39%
ROE(5y)24.55%
ROIC(3y)11.4%
ROIC(5y)10.86%
1.3 Margins
RPM has a Profit Margin of 8.78%. This is amongst the best in the industry. RPM outperforms 83.53% of its industry peers.
In the last couple of years the Profit Margin of RPM has grown nicely.
RPM has a Operating Margin of 12.15%. This is in the better half of the industry: RPM outperforms 65.88% of its industry peers.
RPM's Operating Margin has improved in the last couple of years.
The Gross Margin of RPM (41.09%) is better than 84.71% of its industry peers.
In the last couple of years the Gross Margin of RPM has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 12.15% | ||
| PM (TTM) | 8.78% | ||
| GM | 41.09% |
OM growth 3Y-0.18%
OM growth 5Y6.41%
PM growth 3Y-0.74%
PM growth 5Y10.89%
GM growth 3Y1.43%
GM growth 5Y1.83%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), RPM is creating some value.
Compared to 1 year ago, RPM has about the same amount of shares outstanding.
Compared to 5 years ago, RPM has less shares outstanding
Compared to 1 year ago, RPM has an improved debt to assets ratio.
2.2 Solvency
An Altman-Z score of 4.64 indicates that RPM is not in any danger for bankruptcy at the moment.
RPM's Altman-Z score of 4.64 is amongst the best of the industry. RPM outperforms 91.76% of its industry peers.
RPM has a debt to FCF ratio of 3.71. This is a good value and a sign of high solvency as RPM would need 3.71 years to pay back of all of its debts.
Looking at the Debt to FCF ratio, with a value of 3.71, RPM belongs to the top of the industry, outperforming 87.06% of the companies in the same industry.
RPM has a Debt/Equity ratio of 0.78. This is a neutral value indicating RPM is somewhat dependend on debt financing.
Looking at the Debt to Equity ratio, with a value of 0.78, RPM is in line with its industry, outperforming 45.88% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.78 | ||
| Debt/FCF | 3.71 | ||
| Altman-Z | 4.64 |
ROIC/WACC1.39
WACC8.84%
2.3 Liquidity
A Current Ratio of 2.22 indicates that RPM has no problem at all paying its short term obligations.
RPM's Current ratio of 2.22 is in line compared to the rest of the industry. RPM outperforms 60.00% of its industry peers.
RPM has a Quick Ratio of 1.38. This is a normal value and indicates that RPM is financially healthy and should not expect problems in meeting its short term obligations.
RPM has a better Quick ratio (1.38) than 61.18% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.22 | ||
| Quick Ratio | 1.38 |
3. Growth
3.1 Past
RPM shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 8.44%, which is quite good.
Measured over the past years, RPM shows a quite strong growth in Earnings Per Share. The EPS has been growing by 13.18% on average per year.
The Revenue for RPM has decreased by -21.98% in the past year. This is quite bad
The Revenue has been growing slightly by 5.68% on average over the past years.
EPS 1Y (TTM)8.44%
EPS 3Y5.9%
EPS 5Y13.18%
EPS Q2Q%-32.69%
Revenue 1Y (TTM)-21.98%
Revenue growth 3Y6.3%
Revenue growth 5Y5.68%
Sales Q2Q%-3.05%
3.2 Future
The Earnings Per Share is expected to grow by 8.86% on average over the next years. This is quite good.
Based on estimates for the next years, RPM will show a small growth in Revenue. The Revenue will grow by 2.26% on average per year.
EPS Next Y5.62%
EPS Next 2Y7.04%
EPS Next 3Y8.86%
EPS Next 5YN/A
Revenue Next Year-0.39%
Revenue Next 2Y1.75%
Revenue Next 3Y2.26%
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 decreasing.
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
Based on the Price/Earnings ratio of 21.68, the valuation of RPM can be described as rather expensive.
The rest of the industry has a similar Price/Earnings ratio as RPM.
Compared to an average S&P500 Price/Earnings ratio of 27.54, RPM is valued a bit cheaper.
Based on the Price/Forward Earnings ratio of 19.69, the valuation of RPM can be described as rather expensive.
RPM's Price/Forward Earnings is on the same level as the industry average.
RPM is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 36.44, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 21.68 | ||
| Fwd PE | 19.69 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of RPM indicates a slightly more expensive valuation: RPM is more expensive than 62.35% of the companies listed in the same industry.
Based on the Price/Free Cash Flow ratio, RPM is valued a bit cheaper than the industry average as 64.71% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 25.31 | ||
| EV/EBITDA | 15.08 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
RPM has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)3.86
PEG (5Y)1.64
EPS Next 2Y7.04%
EPS Next 3Y8.86%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 1.83%, RPM has a reasonable but not impressive dividend return.
RPM's Dividend Yield is comparable with the industry average which is at 3.64.
Compared to the average S&P500 Dividend Yield of 2.35, RPM is paying slightly less dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.83% |
5.2 History
The dividend of RPM has a limited annual growth rate of 5.62%.
RPM has been paying a dividend for at least 10 years, so it has a reliable track record.
RPM has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)5.62%
Div Incr Years11
Div Non Decr Years11
5.3 Sustainability
38.91% of the earnings are spent on dividend by RPM. This is a low number and sustainable payout ratio.
The dividend of RPM is growing, but earnings are growing more, so the dividend growth is sustainable.
DP38.91%
EPS Next 2Y7.04%
EPS Next 3Y8.86%
111.43
-0.17 (-0.15%)
Chartmill FA Rating
GICS SectorMaterials
GICS IndustryGroupMaterials
GICS IndustryChemicals
Earnings (Last)
Earnings (Next)
Inst Owners84.92%
Inst Owner Change-0.36%
Ins Owners1.19%
Ins Owner Change1.09%
Market Cap14.31B
Analysts72.38
Price Target126.71 (13.71%)
Short Float %2.07%
Short Ratio3.24
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.83% |
Yearly Dividend1.8
Dividend Growth(5Y)5.62%
DP38.91%
Div Incr Years11
Div Non Decr Years11
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-13.57%
Min EPS beat(2)-29.89%
Max EPS beat(2)2.76%
EPS beat(4)2
Avg EPS beat(4)-5.85%
Min EPS beat(4)-29.89%
Max EPS beat(4)4.31%
EPS beat(8)5
Avg EPS beat(8)-0.63%
EPS beat(12)7
Avg EPS beat(12)1.6%
EPS beat(16)9
Avg EPS beat(16)2.65%
Revenue beat(2)1
Avg Revenue beat(2)-0.43%
Min Revenue beat(2)-2.99%
Max Revenue beat(2)2.12%
Revenue beat(4)1
Avg Revenue beat(4)-1.27%
Min Revenue beat(4)-3.25%
Max Revenue beat(4)2.12%
Revenue beat(8)3
Avg Revenue beat(8)-0.86%
Revenue beat(12)6
Avg Revenue beat(12)8.35%
Revenue beat(16)9
Avg Revenue beat(16)6.78%
PT rev (1m)2.61%
PT rev (3m)-7.88%
EPS NQ rev (1m)-0.17%
EPS NQ rev (3m)0.16%
EPS NY rev (1m)-0.04%
EPS NY rev (3m)-0.01%
Revenue NQ rev (1m)-0.2%
Revenue NQ rev (3m)0.1%
Revenue NY rev (1m)-0.04%
Revenue NY rev (3m)-0.04%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 21.68 | ||
| Fwd PE | 19.69 | ||
| P/S | 1.96 | ||
| P/FCF | 25.31 | ||
| P/OCF | 17.88 | ||
| P/B | 5.35 | ||
| P/tB | 17.77 | ||
| EV/EBITDA | 15.08 |
EPS(TTM)5.14
EY4.61%
EPS(NY)5.66
Fwd EY5.08%
FCF(TTM)4.4
FCFY3.95%
OCF(TTM)6.23
OCFY5.59%
SpS56.84
BVpS20.82
TBVpS6.27
PEG (NY)3.86
PEG (5Y)1.64
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 9.68% | ||
| ROE | 23.96% | ||
| ROCE | 16.5% | ||
| ROIC | 12.27% | ||
| ROICexc | 12.85% | ||
| ROICexgc | 20.2% | ||
| OM | 12.15% | ||
| PM (TTM) | 8.78% | ||
| GM | 41.09% | ||
| FCFM | 7.75% |
ROA(3y)7.73%
ROA(5y)7.31%
ROE(3y)23.39%
ROE(5y)24.55%
ROIC(3y)11.4%
ROIC(5y)10.86%
ROICexc(3y)11.92%
ROICexc(5y)11.39%
ROICexgc(3y)19.49%
ROICexgc(5y)19.06%
ROCE(3y)15.33%
ROCE(5y)14.61%
ROICexcg growth 3Y1.72%
ROICexcg growth 5Y1.48%
ROICexc growth 3Y4.55%
ROICexc growth 5Y6.26%
OM growth 3Y-0.18%
OM growth 5Y6.41%
PM growth 3Y-0.74%
PM growth 5Y10.89%
GM growth 3Y1.43%
GM growth 5Y1.83%
F-Score6
Asset Turnover1.1
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.78 | ||
| Debt/FCF | 3.71 | ||
| Debt/EBITDA | 1.95 | ||
| Cap/Depr | 127.14% | ||
| Cap/Sales | 3.22% | ||
| Interest Coverage | 9.07 | ||
| Cash Conversion | 74.66% | ||
| Profit Quality | 88.22% | ||
| Current Ratio | 2.22 | ||
| Quick Ratio | 1.38 | ||
| Altman-Z | 4.64 |
F-Score6
WACC8.84%
ROIC/WACC1.39
Cap/Depr(3y)144.81%
Cap/Depr(5y)127.14%
Cap/Sales(3y)3.25%
Cap/Sales(5y)3%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)8.44%
EPS 3Y5.9%
EPS 5Y13.18%
EPS Q2Q%-32.69%
EPS Next Y5.62%
EPS Next 2Y7.04%
EPS Next 3Y8.86%
EPS Next 5YN/A
Revenue 1Y (TTM)-21.98%
Revenue growth 3Y6.3%
Revenue growth 5Y5.68%
Sales Q2Q%-3.05%
Revenue Next Year-0.39%
Revenue Next 2Y1.75%
Revenue Next 3Y2.26%
Revenue Next 5YN/A
EBIT growth 1Y-21.99%
EBIT growth 3Y6.11%
EBIT growth 5Y12.46%
EBIT Next Year20.56%
EBIT Next 3Y12.03%
EBIT Next 5YN/A
FCF growth 1Y1470%
FCF growth 3Y14.26%
FCF growth 5Y42.22%
OCF growth 1Y180.04%
OCF growth 3Y13.57%
OCF growth 5Y30.82%