VALE SA-SP ADR (VALE) Stock Fundamental Analysis
NYSE:VALE - New York Stock Exchange, Inc. - US91912E1055 - ADR - Currency: USD
VALE gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 154 industry peers in the Metals & Mining industry. While VALE belongs to the best of the industry regarding profitability, there are concerns on its financial health. VALE may be a bit undervalued, certainly considering the very reasonable score on growth
1. Profitability
1.1 Basic Checks
In the past year VALE was profitable.
In the past year VALE had a positive cash flow from operations.
VALE had positive earnings in each of the past 5 years.
In the past 5 years VALE always reported a positive cash flow from operatings.
1.2 Ratios
Looking at the Return On Assets, with a value of 6.57%, VALE belongs to the top of the industry, outperforming 80.52% of the companies in the same industry.
VALE's Return On Equity of 15.57% is amongst the best of the industry. VALE outperforms 88.31% of its industry peers.
VALE's Return On Invested Capital of 11.71% is amongst the best of the industry. VALE outperforms 89.61% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for VALE is above the industry average of 11.67%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.57% | ||
| ROE | 15.57% | ||
| ROIC | 11.71% |
ROA(3y)12.09%
ROA(5y)13.23%
ROE(3y)29.15%
ROE(5y)32.97%
ROIC(3y)15.63%
ROIC(5y)19.92%
1.3 Margins
VALE has a better Profit Margin (14.88%) than 83.12% of its industry peers.
In the last couple of years the Profit Margin of VALE has declined.
VALE has a better Operating Margin (27.55%) than 81.82% of its industry peers.
VALE's Operating Margin has declined in the last couple of years.
Looking at the Gross Margin, with a value of 35.45%, VALE is in the better half of the industry, outperforming 77.92% of the companies in the same industry.
In the last couple of years the Gross Margin of VALE has declined.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 27.55% | ||
| PM (TTM) | 14.88% | ||
| GM | 35.45% |
OM growth 3Y-20.55%
OM growth 5Y-6.5%
PM growth 3Y-28.12%
PM growth 5YN/A
GM growth 3Y-15.48%
GM growth 5Y-5.12%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so VALE is still creating some value.
The number of shares outstanding for VALE has been reduced compared to 1 year ago.
The number of shares outstanding for VALE has been reduced compared to 5 years ago.
VALE has a worse debt/assets ratio than last year.
2.2 Solvency
Based on the Altman-Z score of 1.73, we must say that VALE is in the distress zone and has some risk of bankruptcy.
The Altman-Z score of VALE (1.73) is worse than 64.94% of its industry peers.
The Debt to FCF ratio of VALE is 14.20, which is on the high side as it means it would take VALE, 14.20 years of fcf income to pay off all of its debts.
VALE has a better Debt to FCF ratio (14.20) than 62.99% of its industry peers.
A Debt/Equity ratio of 0.44 indicates that VALE is not too dependend on debt financing.
VALE's Debt to Equity ratio of 0.44 is on the low side compared to the rest of the industry. VALE is outperformed by 74.03% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.44 | ||
| Debt/FCF | 14.2 | ||
| Altman-Z | 1.73 |
ROIC/WACC0.9
WACC12.98%
2.3 Liquidity
VALE has a Current Ratio of 1.11. This is a normal value and indicates that VALE is financially healthy and should not expect problems in meeting its short term obligations.
VALE's Current ratio of 1.11 is on the low side compared to the rest of the industry. VALE is outperformed by 83.12% of its industry peers.
VALE has a Quick Ratio of 1.11. This is a bad value and indicates that VALE is not financially healthy enough and could expect problems in meeting its short term obligations.
VALE has a Quick ratio of 0.74. This is amonst the worse of the industry: VALE underperforms 81.82% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.11 | ||
| Quick Ratio | 0.74 |
3. Growth
3.1 Past
VALE shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -23.76%.
VALE shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 5.15% yearly.
VALE shows a small growth in Revenue. In the last year, the Revenue has grown by 2.62%.
Measured over the past years, VALE shows a small growth in Revenue. The Revenue has been growing by 7.33% on average per year.
EPS 1Y (TTM)-23.76%
EPS 3Y-31.35%
EPS 5Y5.15%
EPS Q2Q%-15.38%
Revenue 1Y (TTM)2.62%
Revenue growth 3Y-11.13%
Revenue growth 5Y7.33%
Sales Q2Q%-4.02%
3.2 Future
The Earnings Per Share is expected to grow by 8.38% on average over the next years. This is quite good.
The Revenue is expected to grow by 0.48% on average over the next years.
EPS Next Y29.79%
EPS Next 2Y13.8%
EPS Next 3Y8.38%
EPS Next 5YN/A
Revenue Next Year-0.47%
Revenue Next 2Y1.63%
Revenue Next 3Y2.24%
Revenue Next 5Y0.48%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last 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
A Price/Earnings ratio of 7.35 indicates a rather cheap valuation of VALE.
Compared to the rest of the industry, the Price/Earnings ratio of VALE indicates a rather cheap valuation: VALE is cheaper than 99.35% of the companies listed in the same industry.
VALE is valuated cheaply when we compare the Price/Earnings ratio to 27.41, which is the current average of the S&P500 Index.
VALE is valuated cheaply with a Price/Forward Earnings ratio of 5.44.
Based on the Price/Forward Earnings ratio, VALE is valued cheaper than 94.16% of the companies in the same industry.
VALE is valuated cheaply when we compare the Price/Forward Earnings ratio to 35.19, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 7.35 | ||
| Fwd PE | 5.44 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of VALE indicates a rather cheap valuation: VALE is cheaper than 94.81% of the companies listed in the same industry.
72.08% of the companies in the same industry are more expensive than VALE, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 36.77 | ||
| EV/EBITDA | 4.12 |
4.3 Compensation for Growth
VALE's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
VALE has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)0.25
PEG (5Y)1.43
EPS Next 2Y13.8%
EPS Next 3Y8.38%
5. Dividend
5.1 Amount
VALE has a Yearly Dividend Yield of 1.47%.
Compared to an average industry Dividend Yield of 2.90, VALE pays a bit more dividend than its industry peers.
Compared to the average S&P500 Dividend Yield of 2.35, VALE is paying slightly less dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.47% |
5.2 History
On average, the dividend of VALE grows each year by 104.30%, which is quite nice.
VALE has been paying a dividend for at least 10 years, so it has a reliable track record.
Dividend Growth(5Y)104.3%
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
VALE pays out 64.54% of its income as dividend. This is not a sustainable payout ratio.
VALE's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP64.54%
EPS Next 2Y13.8%
EPS Next 3Y8.38%
10.14
+0.18 (+1.81%)
Chartmill FA Rating
GICS SectorMaterials
GICS IndustryGroupMaterials
GICS IndustryMetals & Mining
Earnings (Last)
Earnings (Next)
Inst Owners42.73%
Inst Owner Change-0.01%
Ins OwnersN/A
Ins Owner ChangeN/A
Market Cap43.29B
Analysts76
Price Target14.34 (41.42%)
Short Float %1.8%
Short Ratio2.08
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.47% |
Yearly Dividend0.87
Dividend Growth(5Y)104.3%
DP64.54%
Div Incr Years0
Div Non Decr Years0
Ex-Date
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-73.63%
Min EPS beat(2)-135.22%
Max EPS beat(2)-12.03%
EPS beat(4)2
Avg EPS beat(4)-22.11%
Min EPS beat(4)-135.22%
Max EPS beat(4)43.12%
EPS beat(8)3
Avg EPS beat(8)-25.94%
EPS beat(12)6
Avg EPS beat(12)-5.12%
EPS beat(16)8
Avg EPS beat(16)-4.94%
Revenue beat(2)0
Avg Revenue beat(2)-82.43%
Min Revenue beat(2)-82.52%
Max Revenue beat(2)-82.33%
Revenue beat(4)0
Avg Revenue beat(4)-82.45%
Min Revenue beat(4)-82.62%
Max Revenue beat(4)-82.33%
Revenue beat(8)0
Avg Revenue beat(8)-82.66%
Revenue beat(12)0
Avg Revenue beat(12)-64.59%
Revenue beat(16)0
Avg Revenue beat(16)-51.86%
PT rev (1m)3.57%
PT rev (3m)2.7%
EPS NQ rev (1m)0%
EPS NQ rev (3m)153.43%
EPS NY rev (1m)0%
EPS NY rev (3m)148.27%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0.5%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-0.81%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 7.35 | ||
| Fwd PE | 5.44 | ||
| P/S | 1.14 | ||
| P/FCF | 36.77 | ||
| P/OCF | 5.72 | ||
| P/B | 1.19 | ||
| P/tB | 1.68 | ||
| EV/EBITDA | 4.12 |
EPS(TTM)1.38
EY13.61%
EPS(NY)1.86
Fwd EY18.39%
FCF(TTM)0.28
FCFY2.72%
OCF(TTM)1.77
OCFY17.48%
SpS8.9
BVpS8.51
TBVpS6.05
PEG (NY)0.25
PEG (5Y)1.43
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.57% | ||
| ROE | 15.57% | ||
| ROCE | 14.46% | ||
| ROIC | 11.71% | ||
| ROICexc | 12.41% | ||
| ROICexgc | 14.67% | ||
| OM | 27.55% | ||
| PM (TTM) | 14.88% | ||
| GM | 35.45% | ||
| FCFM | 3.1% |
ROA(3y)12.09%
ROA(5y)13.23%
ROE(3y)29.15%
ROE(5y)32.97%
ROIC(3y)15.63%
ROIC(5y)19.92%
ROICexc(3y)16.65%
ROICexc(5y)22.69%
ROICexgc(3y)19.73%
ROICexgc(5y)26.7%
ROCE(3y)19.31%
ROCE(5y)24.6%
ROICexcg growth 3Y-31.02%
ROICexcg growth 5Y-4.69%
ROICexc growth 3Y-31.7%
ROICexc growth 5Y-5.74%
OM growth 3Y-20.55%
OM growth 5Y-6.5%
PM growth 3Y-28.12%
PM growth 5YN/A
GM growth 3Y-15.48%
GM growth 5Y-5.12%
F-Score4
Asset Turnover0.44
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.44 | ||
| Debt/FCF | 14.2 | ||
| Debt/EBITDA | 1.17 | ||
| Cap/Depr | 208.03% | ||
| Cap/Sales | 16.81% | ||
| Interest Coverage | 8.98 | ||
| Cash Conversion | 55.86% | ||
| Profit Quality | 20.82% | ||
| Current Ratio | 1.11 | ||
| Quick Ratio | 0.74 | ||
| Altman-Z | 1.73 |
F-Score4
WACC12.98%
ROIC/WACC0.9
Cap/Depr(3y)192.28%
Cap/Depr(5y)174.88%
Cap/Sales(3y)14.54%
Cap/Sales(5y)12.69%
Profit Quality(3y)56.79%
Profit Quality(5y)92.18%
High Growth Momentum
Growth
EPS 1Y (TTM)-23.76%
EPS 3Y-31.35%
EPS 5Y5.15%
EPS Q2Q%-15.38%
EPS Next Y29.79%
EPS Next 2Y13.8%
EPS Next 3Y8.38%
EPS Next 5YN/A
Revenue 1Y (TTM)2.62%
Revenue growth 3Y-11.13%
Revenue growth 5Y7.33%
Sales Q2Q%-4.02%
Revenue Next Year-0.47%
Revenue Next 2Y1.63%
Revenue Next 3Y2.24%
Revenue Next 5Y0.48%
EBIT growth 1Y-21.4%
EBIT growth 3Y-29.39%
EBIT growth 5Y0.36%
EBIT Next Year21.93%
EBIT Next 3Y9.54%
EBIT Next 5Y4.23%
FCF growth 1Y-81.45%
FCF growth 3Y-48.33%
FCF growth 5Y-14.71%
OCF growth 1Y-33.59%
OCF growth 3Y-28.4%
OCF growth 5Y1.2%