SERVICE CORP INTERNATIONAL (SCI) Stock Fundamental Analysis
USA - NYSE:SCI - US8175651046 - Common Stock
83.86 USD
+0.68 (+0.82%)
83.86 USD
0 (0%)
Taking everything into account, SCI scores 5 out of 10 in our fundamental rating. SCI was compared to 75 industry peers in the Diversified Consumer Services industry. While SCI belongs to the best of the industry regarding profitability, there are concerns on its financial health. SCI is not valued too expensively and it also shows a decent growth rate.
1. Profitability
1.1 Basic Checks
SCI had positive earnings in the past year.
SCI had a positive operating cash flow in the past year.
SCI had positive earnings in each of the past 5 years.
In the past 5 years SCI always reported a positive cash flow from operatings.
1.2 Ratios
SCI has a Return On Assets of 2.98%. This is in the better half of the industry: SCI outperforms 61.33% of its industry peers.
Looking at the Return On Equity, with a value of 34.29%, SCI belongs to the top of the industry, outperforming 92.00% of the companies in the same industry.
Looking at the Return On Invested Capital, with a value of 4.28%, SCI is in the better half of the industry, outperforming 64.00% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for SCI is significantly below the industry average of 9.69%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.98% | ||
| ROE | 34.29% | ||
| ROIC | 4.28% |
ROA(3y)3.34%
ROA(5y)3.74%
ROE(3y)33.19%
ROE(5y)34.21%
ROIC(3y)4.6%
ROIC(5y)4.88%
1.3 Margins
SCI has a Profit Margin of 12.60%. This is in the better half of the industry: SCI outperforms 77.33% of its industry peers.
In the last couple of years the Profit Margin of SCI has grown nicely.
Looking at the Operating Margin, with a value of 22.81%, SCI belongs to the top of the industry, outperforming 89.33% of the companies in the same industry.
SCI's Operating Margin has improved in the last couple of years.
Looking at the Gross Margin, with a value of 26.41%, SCI is doing worse than 72.00% of the companies in the same industry.
SCI's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 22.81% | ||
| PM (TTM) | 12.6% | ||
| GM | 26.41% |
OM growth 3Y-6.86%
OM growth 5Y2.99%
PM growth 3Y-13.86%
PM growth 5Y1.61%
GM growth 3Y-6.56%
GM growth 5Y2.05%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so SCI is destroying value.
The number of shares outstanding for SCI has been reduced compared to 1 year ago.
Compared to 5 years ago, SCI has less shares outstanding
Compared to 1 year ago, SCI has an improved debt to assets ratio.
2.2 Solvency
Based on the Altman-Z score of 0.86, we must say that SCI is in the distress zone and has some risk of bankruptcy.
Looking at the Altman-Z score, with a value of 0.86, SCI is in line with its industry, outperforming 46.67% of the companies in the same industry.
SCI has a debt to FCF ratio of 7.98. This is a slightly negative value and a sign of low solvency as SCI would need 7.98 years to pay back of all of its debts.
SCI's Debt to FCF ratio of 7.98 is fine compared to the rest of the industry. SCI outperforms 65.33% of its industry peers.
A Debt/Equity ratio of 3.19 is on the high side and indicates that SCI has dependencies on debt financing.
SCI's Debt to Equity ratio of 3.19 is on the low side compared to the rest of the industry. SCI is outperformed by 76.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 3.19 | ||
| Debt/FCF | 7.98 | ||
| Altman-Z | 0.86 |
ROIC/WACC0.56
WACC7.67%
2.3 Liquidity
A Current Ratio of 0.61 indicates that SCI may have some problems paying its short term obligations.
SCI's Current ratio of 0.61 is on the low side compared to the rest of the industry. SCI is outperformed by 77.33% of its industry peers.
SCI has a Quick Ratio of 0.61. This is a bad value and indicates that SCI is not financially healthy enough and could expect problems in meeting its short term obligations.
The Quick ratio of SCI (0.56) is worse than 78.67% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.61 | ||
| Quick Ratio | 0.56 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 8.85% over the past year.
Measured over the past years, SCI shows a quite strong growth in Earnings Per Share. The EPS has been growing by 13.79% on average per year.
The Revenue has been growing slightly by 2.65% in the past year.
The Revenue has been growing slightly by 5.32% on average over the past years.
EPS 1Y (TTM)8.85%
EPS 3Y-8.25%
EPS 5Y13.79%
EPS Q2Q%11.39%
Revenue 1Y (TTM)2.65%
Revenue growth 3Y0.35%
Revenue growth 5Y5.32%
Sales Q2Q%3.04%
3.2 Future
Based on estimates for the next years, SCI will show a quite strong growth in Earnings Per Share. The EPS will grow by 10.06% on average per year.
SCI is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 3.66% yearly.
EPS Next Y9.53%
EPS Next 2Y9.88%
EPS Next 3Y10.06%
EPS Next 5YN/A
Revenue Next Year3.01%
Revenue Next 2Y3.15%
Revenue Next 3Y3.66%
Revenue Next 5YN/A
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 decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
SCI is valuated rather expensively with a Price/Earnings ratio of 22.73.
Based on the Price/Earnings ratio, SCI is valued a bit cheaper than the industry average as 66.67% of the companies are valued more expensively.
When comparing the Price/Earnings ratio of SCI to the average of the S&P500 Index (27.86), we can say SCI is valued inline with the index average.
A Price/Forward Earnings ratio of 19.68 indicates a rather expensive valuation of SCI.
SCI's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. SCI is cheaper than 65.33% of the companies in the same industry.
SCI's Price/Forward Earnings ratio indicates a similar valuation than the S&P500 average which is at 23.32.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.73 | ||
| Fwd PE | 19.68 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of SCI indicates a somewhat cheap valuation: SCI is cheaper than 64.00% of the companies listed in the same industry.
Based on the Price/Free Cash Flow ratio, SCI is valued a bit cheaper than 76.00% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 18.64 | ||
| EV/EBITDA | 12.68 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates SCI does not grow enough to justify the current Price/Earnings ratio.
SCI has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)2.39
PEG (5Y)1.65
EPS Next 2Y9.88%
EPS Next 3Y10.06%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 1.54%, SCI has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 1.93, SCI pays a better dividend. On top of this SCI pays more dividend than 92.00% of the companies listed in the same industry.
Compared to the average S&P500 Dividend Yield of 2.41, SCI is paying slightly less dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.54% |
5.2 History
On average, the dividend of SCI grows each year by 10.53%, which is quite nice.
SCI has paid a dividend for at least 10 years, which is a reliable track record.
SCI has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)10.53%
Div Incr Years11
Div Non Decr Years11
5.3 Sustainability
33.29% of the earnings are spent on dividend by SCI. This is a low number and sustainable payout ratio.
The dividend of SCI is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP33.29%
EPS Next 2Y9.88%
EPS Next 3Y10.06%
83.86
+0.68 (+0.82%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Services
GICS IndustryDiversified Consumer Services
Earnings (Last)
Earnings (Next)
Inst Owners91.47%
Inst Owner Change-3.42%
Ins Owners2.77%
Ins Owner Change0.04%
Market Cap11.76B
Analysts84
Price Target92.35 (10.12%)
Short Float %3.52%
Short Ratio4.59
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.54% |
Yearly Dividend1.2
Dividend Growth(5Y)10.53%
DP33.29%
Div Incr Years11
Div Non Decr Years11
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)3.59%
Min EPS beat(2)2.5%
Max EPS beat(2)4.68%
EPS beat(4)4
Avg EPS beat(4)2.1%
Min EPS beat(4)0.14%
Max EPS beat(4)4.68%
EPS beat(8)7
Avg EPS beat(8)1.91%
EPS beat(12)11
Avg EPS beat(12)5.24%
EPS beat(16)15
Avg EPS beat(16)13.22%
Revenue beat(2)2
Avg Revenue beat(2)0.31%
Min Revenue beat(2)0.3%
Max Revenue beat(2)0.32%
Revenue beat(4)2
Avg Revenue beat(4)-0.18%
Min Revenue beat(4)-1.17%
Max Revenue beat(4)0.32%
Revenue beat(8)5
Avg Revenue beat(8)0.53%
Revenue beat(12)8
Avg Revenue beat(12)1.46%
Revenue beat(16)12
Avg Revenue beat(16)3.25%
PT rev (1m)0.93%
PT rev (3m)1.88%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-1.2%
EPS NY rev (1m)0%
EPS NY rev (3m)1.16%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-0.1%
Revenue NY rev (1m)0%
Revenue NY rev (3m)0.37%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.73 | ||
| Fwd PE | 19.68 | ||
| P/S | 2.77 | ||
| P/FCF | 18.64 | ||
| P/OCF | 11.7 | ||
| P/B | 7.54 | ||
| P/tB | N/A | ||
| EV/EBITDA | 12.68 |
EPS(TTM)3.69
EY4.4%
EPS(NY)4.26
Fwd EY5.08%
FCF(TTM)4.5
FCFY5.37%
OCF(TTM)7.17
OCFY8.55%
SpS30.28
BVpS11.12
TBVpS-3.82
PEG (NY)2.39
PEG (5Y)1.65
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.98% | ||
| ROE | 34.29% | ||
| ROCE | 5.61% | ||
| ROIC | 4.28% | ||
| ROICexc | 4.35% | ||
| ROICexgc | 4.96% | ||
| OM | 22.81% | ||
| PM (TTM) | 12.6% | ||
| GM | 26.41% | ||
| FCFM | 14.86% |
ROA(3y)3.34%
ROA(5y)3.74%
ROE(3y)33.19%
ROE(5y)34.21%
ROIC(3y)4.6%
ROIC(5y)4.88%
ROICexc(3y)4.67%
ROICexc(5y)4.95%
ROICexgc(3y)5.58%
ROICexgc(5y)5.93%
ROCE(3y)6.04%
ROCE(5y)6.4%
ROICexcg growth 3Y-10.1%
ROICexcg growth 5Y2.9%
ROICexc growth 3Y-9.94%
ROICexc growth 5Y3.38%
OM growth 3Y-6.86%
OM growth 5Y2.99%
PM growth 3Y-13.86%
PM growth 5Y1.61%
GM growth 3Y-6.56%
GM growth 5Y2.05%
F-Score7
Asset Turnover0.24
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 3.19 | ||
| Debt/FCF | 7.98 | ||
| Debt/EBITDA | 3.81 | ||
| Cap/Depr | 111.43% | ||
| Cap/Sales | 8.82% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 77.08% | ||
| Profit Quality | 117.97% | ||
| Current Ratio | 0.61 | ||
| Quick Ratio | 0.56 | ||
| Altman-Z | 0.86 |
F-Score7
WACC7.67%
ROIC/WACC0.56
Cap/Depr(3y)121.12%
Cap/Depr(5y)111.78%
Cap/Sales(3y)9.04%
Cap/Sales(5y)8.15%
Profit Quality(3y)94.08%
Profit Quality(5y)94.38%
High Growth Momentum
Growth
EPS 1Y (TTM)8.85%
EPS 3Y-8.25%
EPS 5Y13.79%
EPS Q2Q%11.39%
EPS Next Y9.53%
EPS Next 2Y9.88%
EPS Next 3Y10.06%
EPS Next 5YN/A
Revenue 1Y (TTM)2.65%
Revenue growth 3Y0.35%
Revenue growth 5Y5.32%
Sales Q2Q%3.04%
Revenue Next Year3.01%
Revenue Next 2Y3.15%
Revenue Next 3Y3.66%
Revenue Next 5YN/A
EBIT growth 1Y5.87%
EBIT growth 3Y-6.53%
EBIT growth 5Y8.47%
EBIT Next Year40.96%
EBIT Next 3Y15.44%
EBIT Next 5YN/A
FCF growth 1Y95.92%
FCF growth 3Y-3.42%
FCF growth 5Y7.41%
OCF growth 1Y40.35%
OCF growth 3Y0.87%
OCF growth 5Y8.49%