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VELOCITY FINANCIAL INC (VEL) Stock Fundamental Analysis

USA - NYSE:VEL - US92262D1019 - Common Stock

18.62 USD
-0.08 (-0.43%)
Last: 10/28/2025, 1:52:15 PM
Fundamental Rating

5

Taking everything into account, VEL scores 5 out of 10 in our fundamental rating. VEL was compared to 99 industry peers in the Financial Services industry. While VEL belongs to the best of the industry regarding profitability, there are concerns on its financial health. An interesting combination arises when we look at growth and value: VEL is growing strongly while it also seems undervalued.


Dividend Valuation Growth Profitability Health

7

1. Profitability

1.1 Basic Checks

VEL had positive earnings in the past year.
In the past year VEL had a positive cash flow from operations.
VEL had positive earnings in 4 of the past 5 years.
VEL had a positive operating cash flow in each of the past 5 years.
VEL Yearly Net Income VS EBIT VS OCF VS FCFVEL Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 100M -100M 200M 300M

1.2 Ratios

VEL has a Return On Assets (1.24%) which is comparable to the rest of the industry.
VEL's Return On Equity of 13.43% is fine compared to the rest of the industry. VEL outperforms 71.72% of its industry peers.
VEL has a better Return On Invested Capital (4.93%) than 64.65% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for VEL is below the industry average of 7.79%.
The 3 year average ROIC (4.55%) for VEL is below the current ROIC(4.93%), indicating increased profibility in the last year.
Industry RankSector Rank
ROA 1.24%
ROE 13.43%
ROIC 4.93%
ROA(3y)1.08%
ROA(5y)0.5%
ROE(3y)11.12%
ROE(5y)5.87%
ROIC(3y)4.55%
ROIC(5y)4.48%
VEL Yearly ROA, ROE, ROICVEL Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 5 -5 10 -10

1.3 Margins

Looking at the Profit Margin, with a value of 16.49%, VEL is in the better half of the industry, outperforming 69.70% of the companies in the same industry.
In the last couple of years the Profit Margin of VEL has grown nicely.
VEL's Operating Margin of 88.39% is amongst the best of the industry. VEL outperforms 100.00% of its industry peers.
VEL's Operating Margin has improved in the last couple of years.
With an excellent Gross Margin value of 88.82%, VEL belongs to the best of the industry, outperforming 91.92% of the companies in the same industry.
VEL's Gross Margin has been stable in the last couple of years.
Industry RankSector Rank
OM 88.39%
PM (TTM) 16.49%
GM 88.82%
OM growth 3Y2.96%
OM growth 5Y2.4%
PM growth 3Y14.34%
PM growth 5Y8.7%
GM growth 3Y-2.01%
GM growth 5Y-1.17%
VEL Yearly Profit, Operating, Gross MarginsVEL Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 20 40 60 80

0

2. Health

2.1 Basic Checks

The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so VEL is destroying value.
Compared to 1 year ago, VEL has more shares outstanding
VEL has more shares outstanding than it did 5 years ago.
The debt/assets ratio for VEL is higher compared to a year ago.
VEL Yearly Shares OutstandingVEL Yearly Shares OutstandingYearly Shares Outstanding 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 10M 20M 30M
VEL Yearly Total Debt VS Total AssetsVEL Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 1B 2B 3B 4B 5B

2.2 Solvency

VEL has an Altman-Z score of 0.35. This is a bad value and indicates that VEL is not financially healthy and even has some risk of bankruptcy.
The Altman-Z score of VEL (0.35) is comparable to the rest of the industry.
The Debt to FCF ratio of VEL is 224.95, which is on the high side as it means it would take VEL, 224.95 years of fcf income to pay off all of its debts.
The Debt to FCF ratio of VEL (224.95) is worse than 61.62% of its industry peers.
A Debt/Equity ratio of 9.55 is on the high side and indicates that VEL has dependencies on debt financing.
VEL has a worse Debt to Equity ratio (9.55) than 85.86% of its industry peers.
Industry RankSector Rank
Debt/Equity 9.55
Debt/FCF 224.95
Altman-Z 0.35
ROIC/WACC0.91
WACC5.42%
VEL Yearly LT Debt VS Equity VS FCFVEL Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 1B 2B 3B 4B

2.3 Liquidity

A Current Ratio of 0.25 indicates that VEL may have some problems paying its short term obligations.
VEL has a Current ratio of 0.25. This is in the lower half of the industry: VEL underperforms 69.70% of its industry peers.
A Quick Ratio of 0.25 indicates that VEL may have some problems paying its short term obligations.
The Quick ratio of VEL (0.25) is worse than 69.70% of its industry peers.
Industry RankSector Rank
Current Ratio 0.25
Quick Ratio 0.25
VEL Yearly Current Assets VS Current LiabilitesVEL Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 100M 200M 300M 400M

8

3. Growth

3.1 Past

VEL shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 31.28%, which is quite impressive.
Measured over the past years, VEL shows a quite strong growth in Earnings Per Share. The EPS has been growing by 15.62% on average per year.
Looking at the last year, VEL shows a very strong growth in Revenue. The Revenue has grown by 33.95%.
VEL shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 20.82% yearly.
EPS 1Y (TTM)31.28%
EPS 3Y27.91%
EPS 5Y15.62%
EPS Q2Q%62.22%
Revenue 1Y (TTM)33.95%
Revenue growth 3Y29.96%
Revenue growth 5Y20.82%
Sales Q2Q%59.67%

3.2 Future

VEL is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 11.68% yearly.
VEL is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 16.85% yearly.
EPS Next Y24.38%
EPS Next 2Y12.64%
EPS Next 3Y11.68%
EPS Next 5YN/A
Revenue Next Year3.54%
Revenue Next 2Y15.88%
Revenue Next 3Y16.85%
Revenue Next 5YN/A

3.3 Evolution

The estimated forward EPS growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
VEL Yearly Revenue VS EstimatesVEL Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 100M 200M 300M 400M
VEL Yearly EPS VS EstimatesVEL Yearly EPS VS EstimatesYearly EPS VS Estimates 2019 2020 2021 2022 2023 2024 2025 2026 2027 0.5 1 1.5 2 2.5

7

4. Valuation

4.1 Price/Earnings Ratio

The Price/Earnings ratio is 7.92, which indicates a rather cheap valuation of VEL.
81.82% of the companies in the same industry are more expensive than VEL, based on the Price/Earnings ratio.
When comparing the Price/Earnings ratio of VEL to the average of the S&P500 Index (27.08), we can say VEL is valued rather cheaply.
VEL is valuated cheaply with a Price/Forward Earnings ratio of 7.23.
Based on the Price/Forward Earnings ratio, VEL is valued a bit cheaper than 72.73% of the companies in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 23.09, VEL is valued rather cheaply.
Industry RankSector Rank
PE 7.92
Fwd PE 7.23
VEL Price Earnings VS Forward Price EarningsVEL Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 10 20 30

4.2 Price Multiples

VEL's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. VEL is cheaper than 60.61% of the companies in the same industry.
The rest of the industry has a similar Price/Free Cash Flow ratio as VEL.
Industry RankSector Rank
P/FCF 28.2
EV/EBITDA 13.89
VEL Per share dataVEL EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 5 10 15

4.3 Compensation for Growth

The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
The decent profitability rating of VEL may justify a higher PE ratio.
PEG (NY)0.32
PEG (5Y)0.51
EPS Next 2Y12.64%
EPS Next 3Y11.68%

0

5. Dividend

5.1 Amount

No dividends for VEL!.
Industry RankSector Rank
Dividend Yield N/A

VELOCITY FINANCIAL INC

NYSE:VEL (10/28/2025, 1:52:15 PM)

18.62

-0.08 (-0.43%)

Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupFinancial Services
GICS IndustryFinancial Services
Earnings (Last)08-07 2025-08-07/amc
Earnings (Next)11-06 2025-11-06/amc
Inst Owners62.62%
Inst Owner Change0.24%
Ins Owners2.91%
Ins Owner Change12.05%
Market Cap715.75M
Revenue(TTM)487.06M
Net Income(TTM)80.31M
Analysts77.14
Price Target21.76 (16.86%)
Short Float %1.48%
Short Ratio3.75
Dividend
Industry RankSector Rank
Dividend Yield N/A
Yearly DividendN/A
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)19.79%
Min EPS beat(2)4.06%
Max EPS beat(2)35.52%
EPS beat(4)3
Avg EPS beat(4)14.91%
Min EPS beat(4)-3.05%
Max EPS beat(4)35.52%
EPS beat(8)7
Avg EPS beat(8)15.38%
EPS beat(12)9
Avg EPS beat(12)11.57%
EPS beat(16)13
Avg EPS beat(16)13.8%
Revenue beat(2)1
Avg Revenue beat(2)35.28%
Min Revenue beat(2)-40.39%
Max Revenue beat(2)110.96%
Revenue beat(4)3
Avg Revenue beat(4)25.26%
Min Revenue beat(4)-40.39%
Max Revenue beat(4)110.96%
Revenue beat(8)7
Avg Revenue beat(8)19.16%
Revenue beat(12)11
Avg Revenue beat(12)37.12%
Revenue beat(16)15
Avg Revenue beat(16)57.91%
PT rev (1m)0%
PT rev (3m)0%
EPS NQ rev (1m)9.01%
EPS NQ rev (3m)11.35%
EPS NY rev (1m)6.38%
EPS NY rev (3m)12.44%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0%
Revenue NY rev (1m)0%
Revenue NY rev (3m)8.73%
Valuation
Industry RankSector Rank
PE 7.92
Fwd PE 7.23
P/S 1.47
P/FCF 28.2
P/OCF 26.61
P/B 1.2
P/tB 1.21
EV/EBITDA 13.89
EPS(TTM)2.35
EY12.62%
EPS(NY)2.58
Fwd EY13.83%
FCF(TTM)0.66
FCFY3.55%
OCF(TTM)0.7
OCFY3.76%
SpS12.67
BVpS15.55
TBVpS15.38
PEG (NY)0.32
PEG (5Y)0.51
Graham Number28.68
Profitability
Industry RankSector Rank
ROA 1.24%
ROE 13.43%
ROCE 7.2%
ROIC 4.93%
ROICexc 4.99%
ROICexgc 5.1%
OM 88.39%
PM (TTM) 16.49%
GM 88.82%
FCFM 5.21%
ROA(3y)1.08%
ROA(5y)0.5%
ROE(3y)11.12%
ROE(5y)5.87%
ROIC(3y)4.55%
ROIC(5y)4.48%
ROICexc(3y)4.6%
ROICexc(5y)4.52%
ROICexgc(3y)4.66%
ROICexgc(5y)4.58%
ROCE(3y)6.64%
ROCE(5y)6.4%
ROICexgc growth 3Y6.61%
ROICexgc growth 5Y3.27%
ROICexc growth 3Y6.46%
ROICexc growth 5Y3.05%
OM growth 3Y2.96%
OM growth 5Y2.4%
PM growth 3Y14.34%
PM growth 5Y8.7%
GM growth 3Y-2.01%
GM growth 5Y-1.17%
F-Score4
Asset Turnover0.08
Health
Industry RankSector Rank
Debt/Equity 9.55
Debt/FCF 224.95
Debt/EBITDA 13.18
Cap/Depr 58.96%
Cap/Sales 0.31%
Interest Coverage 1.46
Cash Conversion 6.21%
Profit Quality 31.6%
Current Ratio 0.25
Quick Ratio 0.25
Altman-Z 0.35
F-Score4
WACC5.42%
ROIC/WACC0.91
Cap/Depr(3y)194.25%
Cap/Depr(5y)148.18%
Cap/Sales(3y)0.77%
Cap/Sales(5y)0.68%
Profit Quality(3y)96.08%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)31.28%
EPS 3Y27.91%
EPS 5Y15.62%
EPS Q2Q%62.22%
EPS Next Y24.38%
EPS Next 2Y12.64%
EPS Next 3Y11.68%
EPS Next 5YN/A
Revenue 1Y (TTM)33.95%
Revenue growth 3Y29.96%
Revenue growth 5Y20.82%
Sales Q2Q%59.67%
Revenue Next Year3.54%
Revenue Next 2Y15.88%
Revenue Next 3Y16.85%
Revenue Next 5YN/A
EBIT growth 1Y35.8%
EBIT growth 3Y33.8%
EBIT growth 5Y23.72%
EBIT Next Year33.79%
EBIT Next 3YN/A
EBIT Next 5YN/A
FCF growth 1Y-62.59%
FCF growth 3Y-17.04%
FCF growth 5YN/A
OCF growth 1Y-60.44%
OCF growth 3Y-13.14%
OCF growth 5YN/A

VELOCITY FINANCIAL INC / VEL FAQ

What is the ChartMill fundamental rating of VELOCITY FINANCIAL INC (VEL) stock?

ChartMill assigns a fundamental rating of 5 / 10 to VEL.


What is the valuation status of VELOCITY FINANCIAL INC (VEL) stock?

ChartMill assigns a valuation rating of 7 / 10 to VELOCITY FINANCIAL INC (VEL). This can be considered as Undervalued.


How profitable is VELOCITY FINANCIAL INC (VEL) stock?

VELOCITY FINANCIAL INC (VEL) has a profitability rating of 7 / 10.


What is the valuation of VELOCITY FINANCIAL INC based on its PE and PB ratios?

The Price/Earnings (PE) ratio for VELOCITY FINANCIAL INC (VEL) is 7.92 and the Price/Book (PB) ratio is 1.2.


What is the financial health of VELOCITY FINANCIAL INC (VEL) stock?

The financial health rating of VELOCITY FINANCIAL INC (VEL) is 0 / 10.