VELOCITY FINANCIAL INC (VEL) Stock Fundamental Analysis
USA - NYSE:VEL - US92262D1019 - Common Stock
18.62 USD
-0.08 (-0.43%)
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.
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.
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 Rank | Sector 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%
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 Rank | Sector 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%
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.
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 Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 9.55 | ||
| Debt/FCF | 224.95 | ||
| Altman-Z | 0.35 |
ROIC/WACC0.91
WACC5.42%
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 Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.25 | ||
| Quick Ratio | 0.25 |
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.
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 Rank | Sector Rank | ||
|---|---|---|---|
| PE | 7.92 | ||
| Fwd PE | 7.23 |
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 Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 28.2 | ||
| EV/EBITDA | 13.89 |
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%
5. Dividend
5.1 Amount
No dividends for VEL!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
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)
Earnings (Next)
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 Rank | Sector 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 Rank | Sector 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 Rank | Sector 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 Rank | Sector 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.