RPM INTERNATIONAL INC (RPM)
US7496851038 - Common Stock
We assign a fundamental rating of 7 out of 10 to RPM. RPM was compared to 84 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 correct valuation and a medium growth rate. With these ratings, RPM could be worth investigating further for quality investing!.
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.
In the past 5 years RPM has always been profitable.
Each year in the past 5 years RPM had a positive operating cash flow.
1.2 Ratios
The Return On Assets of RPM (11.86%) is better than 96.43% of its industry peers.
Looking at the Return On Equity, with a value of 32.25%, RPM belongs to the top of the industry, outperforming 96.43% of the companies in the same industry.
RPM has a Return On Invested Capital of 17.02%. This is amongst the best in the industry. RPM outperforms 98.81% of its industry peers.
The Average Return On Invested Capital over the past 3 years for RPM is above the industry average of 7.02%.
The last Return On Invested Capital (17.02%) for RPM is above the 3 year average (11.31%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 11.86% | ||
| ROE | 32.25% | ||
| ROIC | 17.02% |
ROA(3y)7.42%
ROA(5y)6.5%
ROE(3y)25.16%
ROE(5y)23.66%
ROIC(3y)11.31%
ROIC(5y)10.6%
1.3 Margins
Looking at the Profit Margin, with a value of 8.09%, RPM is in the better half of the industry, outperforming 78.57% of the companies in the same industry.
In the last couple of years the Profit Margin of RPM has remained more or less at the same level.
The Operating Margin of RPM (12.16%) is better than 69.05% of its industry peers.
RPM's Operating Margin has improved in the last couple of years.
RPM's Gross Margin of 40.49% is amongst the best of the industry. RPM outperforms 84.52% of its industry peers.
RPM's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 12.16% | ||
| PM (TTM) | 8.09% | ||
| GM | 40.49% |
OM growth 3Y3.37%
OM growth 5Y2.31%
PM growth 3Y6.15%
PM growth 5Y0.92%
GM growth 3Y-0.12%
GM growth 5Y-0.01%
2. Health
2.1 Basic Checks
RPM has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
Compared to 1 year ago, RPM has less shares outstanding
RPM has less shares outstanding than it did 5 years ago.
The debt/assets ratio for RPM has been reduced compared to a year ago.
2.2 Solvency
RPM has an Altman-Z score of 5.10. This indicates that RPM is financially healthy and has little risk of bankruptcy at the moment.
RPM has a better Altman-Z score (5.10) than 91.67% of its industry peers.
RPM has a debt to FCF ratio of 2.10. This is a good value and a sign of high solvency as RPM would need 2.10 years to pay back of all of its debts.
With an excellent Debt to FCF ratio value of 2.10, RPM belongs to the best of the industry, outperforming 88.10% of the companies in the same industry.
RPM has a Debt/Equity ratio of 0.93. This is a neutral value indicating RPM is somewhat dependend on debt financing.
With a Debt to Equity ratio value of 0.93, RPM is not doing good in the industry: 64.29% of the companies in the same industry are doing better.
Although RPM does not score too well on debt/equity it has very limited outstanding debt, which is well covered by the FCF. We will not put too much weight on the debt/equity number as it may be because of low equity, which could be a consequence of a share buyback program for instance. This needs to be investigated.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.93 | ||
| Debt/FCF | 2.1 | ||
| Altman-Z | 5.1 |
ROIC/WACC2.09
WACC8.16%
2.3 Liquidity
RPM has a Current Ratio of 2.29. This indicates that RPM is financially healthy and has no problem in meeting its short term obligations.
RPM has a Current ratio (2.29) which is comparable to the rest of the industry.
A Quick Ratio of 1.39 indicates that RPM should not have too much problems paying its short term obligations.
RPM has a Quick ratio (1.39) which is in line with its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.29 | ||
| Quick Ratio | 1.39 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 8.72% over the past year.
Measured over the past years, RPM shows a quite strong growth in Earnings Per Share. The EPS has been growing by 8.88% on average per year.
Looking at the last year, RPM shows a small growth in Revenue. The Revenue has grown by 2.17% in the last year.
The Revenue has been growing slightly by 6.40% on average over the past years.
EPS 1Y (TTM)8.72%
EPS 3Y11.89%
EPS 5Y8.88%
EPS growth Q2Q40.54%
Revenue 1Y (TTM)2.17%
Revenue growth 3Y9.63%
Revenue growth 5Y6.4%
Revenue growth Q2Q0.45%
3.2 Future
The Earnings Per Share is expected to grow by 13.66% on average over the next years. This is quite good.
RPM is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 3.26% yearly.
EPS Next Y16.05%
EPS Next 2Y14.12%
EPS Next 3Y13.66%
EPS Next 5YN/A
Revenue Next Year1.81%
Revenue Next 2Y2.71%
Revenue Next 3Y3.26%
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 accelerating.
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 23.88, the valuation of RPM can be described as rather expensive.
RPM's Price/Earnings ratio is in line with the industry average.
When comparing the Price/Earnings ratio of RPM to the average of the S&P500 Index (28.67), we can say RPM is valued inline with the index average.
RPM is valuated rather expensively with a Price/Forward Earnings ratio of 20.21.
RPM's Price/Forward Earnings ratio is in line with the industry average.
RPM is valuated at similar levels of the S&P average when we compare the Price/Forward Earnings ratio to 20.15, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 23.88 | ||
| Fwd PE | 20.21 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of RPM is on the same level as its industry peers.
Based on the Price/Free Cash Flow ratio, RPM is valued a bit cheaper than 77.38% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 13.98 | ||
| EV/EBITDA | 12.7 |
4.3 Compensation for Growth
The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
The excellent profitability rating of RPM may justify a higher PE ratio.
RPM's earnings are expected to grow with 13.66% in the coming years. This may justify a more expensive valuation.
PEG (NY)1.49
PEG (5Y)2.69
EPS Next 2Y14.12%
EPS Next 3Y13.66%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 1.63%, RPM has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 3.08, RPM has a dividend in line with its industry peers.
Compared to the average S&P500 Dividend Yield of 2.32, RPM is paying slightly less dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.63% |
5.2 History
The dividend of RPM has a limited annual growth rate of 5.76%.
RPM has paid a dividend for at least 10 years, which is a reliable track record.
RPM has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)5.76%
Div Incr Years10
Div Non Decr Years10
5.3 Sustainability
RPM pays out 29.95% of its income as dividend. This is a sustainable payout ratio.
The dividend of RPM is growing, but earnings are growing more, so the dividend growth is sustainable.
DP29.95%
EPS Next 2Y14.12%
EPS Next 3Y13.66%
RPM INTERNATIONAL INC
NYSE:RPM (5/20/2024, 7:04:00 PM)
After market: 113.2 0 (0%)113.2
-0.31 (-0.27%)
Chartmill FA Rating
GICS SectorMaterials
GICS IndustryGroupMaterials
GICS IndustryChemicals
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap14.58B
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.63% |
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
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EPS beat(8)
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EPS beat(16)
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Revenue beat(2)
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PT rev (1m)
PT rev (3m)
EPS NQ rev (1m)
EPS NQ rev (3m)
EPS NY rev (1m)
EPS NY rev (3m)
Revenue NQ rev (1m)
Revenue NQ rev (3m)
Revenue NY rev (1m)
Revenue NY rev (3m)
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 23.88 | ||
| Fwd PE | 20.21 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)1.49
PEG (5Y)2.69
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 11.86% | ||
| ROE | 32.25% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 12.16% | ||
| PM (TTM) | 8.09% | ||
| GM | 40.49% | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover1.47
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.93 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 2.29 | ||
| Quick Ratio | 1.39 | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
Growth
EPS 1Y (TTM)8.72%
EPS 3Y11.89%
EPS 5Y
EPS growth Q2Q
EPS Next Y16.05%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)2.17%
Revenue growth 3Y9.63%
Revenue growth 5Y
Revenue growth Q2Q
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y