ROLLS-ROYCE HOLDINGS PLC (RRU.DE) Stock Fundamental Analysis
Europe - Frankfurt Stock Exchange - FRA:RRU - GB00B63H8491 - Common Stock
14.52 EUR
+0.02 (+0.14%)
Overall RRU gets a fundamental rating of 6 out of 10. We evaluated RRU against 53 industry peers in the Aerospace & Defense industry. RRU has an excellent profitability rating, but there are some minor concerns on its financial health. RRU is growing strongly while it is still valued neutral. This is a good combination! These ratings could make RRU a good candidate for growth investing.
1. Profitability
1.1 Basic Checks
- In the past year RRU was profitable.
- RRU had a positive operating cash flow in the past year.
- In multiple years RRU reported negative net income over the last 5 years.
- In multiple years RRU reported negative operating cash flow during the last 5 years.
1.2 Ratios
- Looking at the Return On Assets, with a value of 15.26%, RRU belongs to the top of the industry, outperforming 98.11% of the companies in the same industry.
- RRU has a Return On Equity of 240.37%. This is amongst the best in the industry. RRU outperforms 100.00% of its industry peers.
- With a decent Return On Invested Capital value of 11.49%, RRU is doing good in the industry, outperforming 73.58% of the companies in the same industry.
- RRU had an Average Return On Invested Capital over the past 3 years of 6.58%. This is below the industry average of 9.24%.
- The 3 year average ROIC (6.58%) for RRU is below the current ROIC(11.49%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 15.26% | ||
| ROE | 240.37% | ||
| ROIC | 11.49% |
ROA(3y)3.47%
ROA(5y)0.02%
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)6.58%
ROIC(5y)N/A
1.3 Margins
- With an excellent Profit Margin value of 29.62%, RRU belongs to the best of the industry, outperforming 100.00% of the companies in the same industry.
- In the last couple of years the Profit Margin of RRU has grown nicely.
- The Operating Margin of RRU (16.47%) is better than 88.68% of its industry peers.
- RRU's Operating Margin has improved in the last couple of years.
- RRU has a Gross Margin (25.80%) which is comparable to the rest of the industry.
- RRU's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 16.47% | ||
| PM (TTM) | 29.62% | ||
| GM | 25.8% |
OM growth 3Y43.46%
OM growth 5YN/A
PM growth 3Y131.85%
PM growth 5YN/A
GM growth 3Y5.44%
GM growth 5Y31.49%
2. Health
2.1 Basic Checks
- The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so RRU is still creating some value.
- RRU has more shares outstanding than it did 1 year ago.
- Compared to 5 years ago, RRU has more shares outstanding
- The debt/assets ratio for RRU has been reduced compared to a year ago.
2.2 Solvency
- An Altman-Z score of 2.75 indicates that RRU is not a great score, but indicates only limited risk for bankruptcy at the moment.
- RRU has a Altman-Z score (2.75) which is in line with its industry peers.
- The Debt to FCF ratio of RRU is 1.55, which is an excellent value as it means it would take RRU, only 1.55 years of fcf income to pay off all of its debts.
- With an excellent Debt to FCF ratio value of 1.55, RRU belongs to the best of the industry, outperforming 88.68% of the companies in the same industry.
- RRU has a Debt/Equity ratio of 1.18. This is a high value indicating a heavy dependency on external financing.
- Looking at the Debt to Equity ratio, with a value of 1.18, RRU is doing worse than 77.36% of the companies in the same industry.
- Even though the debt/equity ratio score it not favorable for RRU, it has very limited outstanding debt, so we won't put too much weight on the DE evaluation.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.18 | ||
| Debt/FCF | 1.55 | ||
| Altman-Z | 2.75 |
ROIC/WACC1.11
WACC10.31%
2.3 Liquidity
- RRU has a Current Ratio of 1.24. This is a normal value and indicates that RRU is financially healthy and should not expect problems in meeting its short term obligations.
- RRU has a better Current ratio (1.24) than 60.38% of its industry peers.
- RRU has a Quick Ratio of 1.24. This is a bad value and indicates that RRU is not financially healthy enough and could expect problems in meeting its short term obligations.
- The Quick ratio of RRU (0.93) is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.24 | ||
| Quick Ratio | 0.93 |
3. Growth
3.1 Past
- The Earnings Per Share has grown by an impressive 51.97% over the past year.
- RRU shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 29.95% yearly.
- The Revenue has grown by 9.62% in the past year. This is quite good.
- RRU shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 2.66% yearly.
EPS 1Y (TTM)51.97%
EPS 3Y468.12%
EPS 5Y29.95%
EPS Q2Q%75.87%
Revenue 1Y (TTM)9.62%
Revenue growth 3Y19.01%
Revenue growth 5Y2.66%
Sales Q2Q%10.69%
3.2 Future
- RRU is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 17.12% yearly.
- Based on estimates for the next years, RRU will show a quite strong growth in Revenue. The Revenue will grow by 8.92% on average per year.
EPS Next Y45.77%
EPS Next 2Y29.01%
EPS Next 3Y23.84%
EPS Next 5Y17.12%
Revenue Next Year13.68%
Revenue Next 2Y11.64%
Revenue Next 3Y10.53%
Revenue Next 5Y8.92%
3.3 Evolution
- Although the future EPS growth is still strong, it is not able to hold up the even more excellent growth rate of the past 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
- A Price/Earnings ratio of 46.84 indicates a quite expensive valuation of RRU.
- The rest of the industry has a similar Price/Earnings ratio as RRU.
- When comparing the Price/Earnings ratio of RRU to the average of the S&P500 Index (27.25), we can say RRU is valued expensively.
- The Price/Forward Earnings ratio is 37.55, which means the current valuation is very expensive for RRU.
- Compared to the rest of the industry, the Price/Forward Earnings ratio of RRU is on the same level as its industry peers.
- When comparing the Price/Forward Earnings ratio of RRU to the average of the S&P500 Index (25.98), we can say RRU is valued slightly more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 46.84 | ||
| Fwd PE | 37.55 |
4.2 Price Multiples
- Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of RRU is on the same level as its industry peers.
- Based on the Price/Free Cash Flow ratio, RRU is valued a bit cheaper than the industry average as 77.36% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 33.37 | ||
| EV/EBITDA | 25.83 |
4.3 Compensation for Growth
- RRU's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
- RRU has a very decent profitability rating, which may justify a higher PE ratio.
- RRU's earnings are expected to grow with 23.84% in the coming years. This may justify a more expensive valuation.
PEG (NY)1.02
PEG (5Y)1.56
EPS Next 2Y29.01%
EPS Next 3Y23.84%
5. Dividend
5.1 Amount
- With a yearly dividend of 0.84%, RRU is not a good candidate for dividend investing.
- Compared to an average industry Dividend Yield of 0.74, RRU pays a bit more dividend than its industry peers.
- Compared to an average S&P500 Dividend Yield of 1.82, RRU's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.84% |
5.2 History
Dividend Growth(5Y)N/A
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
DPN/A
EPS Next 2Y29.01%
EPS Next 3Y23.84%
ROLLS-ROYCE HOLDINGS PLC / RRU.DE FAQ
What is the ChartMill fundamental rating of ROLLS-ROYCE HOLDINGS PLC (RRU.DE) stock?
ChartMill assigns a fundamental rating of 6 / 10 to RRU.DE.
What is the valuation status of ROLLS-ROYCE HOLDINGS PLC (RRU.DE) stock?
ChartMill assigns a valuation rating of 4 / 10 to ROLLS-ROYCE HOLDINGS PLC (RRU.DE). This can be considered as Fairly Valued.
How profitable is ROLLS-ROYCE HOLDINGS PLC (RRU.DE) stock?
ROLLS-ROYCE HOLDINGS PLC (RRU.DE) has a profitability rating of 7 / 10.
What is the financial health of ROLLS-ROYCE HOLDINGS PLC (RRU.DE) stock?
The financial health rating of ROLLS-ROYCE HOLDINGS PLC (RRU.DE) is 5 / 10.