VALMONT INDUSTRIES (VMI) Stock Fundamental Analysis
NYSE:VMI - New York Stock Exchange, Inc. - US9202531011 - Common Stock - Currency: USD
We assign a fundamental rating of 7 out of 10 to VMI. VMI was compared to 49 industry peers in the Construction & Engineering industry. VMI scores excellent points on both the profitability and health parts. This is a solid base for a good stock. VMI has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
In the past year VMI was profitable.
VMI had a positive operating cash flow in the past year.
Each year in the past 5 years VMI has been profitable.
In the past 5 years VMI always reported a positive cash flow from operatings.
1.2 Ratios
With a decent Return On Assets value of 10.30%, VMI is doing good in the industry, outperforming 79.59% of the companies in the same industry.
VMI has a Return On Equity of 21.27%. This is in the better half of the industry: VMI outperforms 75.51% of its industry peers.
VMI has a Return On Invested Capital of 13.63%. This is in the better half of the industry: VMI outperforms 79.59% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for VMI is below the industry average of 16.70%.
The last Return On Invested Capital (13.63%) for VMI is above the 3 year average (11.89%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 10.3% | ||
| ROE | 21.27% | ||
| ROIC | 13.63% |
ROA(3y)7.28%
ROA(5y)6.46%
ROE(3y)16.53%
ROE(5y)15.12%
ROIC(3y)11.89%
ROIC(5y)10.15%
1.3 Margins
Looking at the Profit Margin, with a value of 8.55%, VMI belongs to the top of the industry, outperforming 83.67% of the companies in the same industry.
In the last couple of years the Profit Margin of VMI has grown nicely.
Looking at the Operating Margin, with a value of 12.82%, VMI belongs to the top of the industry, outperforming 89.80% of the companies in the same industry.
VMI's Operating Margin has improved in the last couple of years.
Looking at the Gross Margin, with a value of 30.15%, VMI belongs to the top of the industry, outperforming 81.63% of the companies in the same industry.
In the last couple of years the Gross Margin of VMI has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 12.82% | ||
| PM (TTM) | 8.55% | ||
| GM | 30.15% |
OM growth 3Y15.4%
OM growth 5Y9.34%
PM growth 3Y15.22%
PM growth 5Y10.06%
GM growth 3Y6.46%
GM growth 5Y4.3%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), VMI is creating some value.
VMI has less shares outstanding than it did 1 year ago.
Compared to 5 years ago, VMI has less shares outstanding
Compared to 1 year ago, VMI has an improved debt to assets ratio.
2.2 Solvency
VMI has an Altman-Z score of 5.82. This indicates that VMI is financially healthy and has little risk of bankruptcy at the moment.
VMI has a Altman-Z score of 5.82. This is amongst the best in the industry. VMI outperforms 81.63% of its industry peers.
VMI has a debt to FCF ratio of 1.41. This is a very positive value and a sign of high solvency as it would only need 1.41 years to pay back of all of its debts.
VMI has a better Debt to FCF ratio (1.41) than 77.55% of its industry peers.
VMI has a Debt/Equity ratio of 0.45. This is a healthy value indicating a solid balance between debt and equity.
With a decent Debt to Equity ratio value of 0.45, VMI is doing good in the industry, outperforming 65.31% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.45 | ||
| Debt/FCF | 1.41 | ||
| Altman-Z | 5.82 |
ROIC/WACC1.49
WACC9.15%
2.3 Liquidity
VMI has a Current Ratio of 2.26. This indicates that VMI is financially healthy and has no problem in meeting its short term obligations.
VMI has a better Current ratio (2.26) than 93.88% of its industry peers.
A Quick Ratio of 1.50 indicates that VMI should not have too much problems paying its short term obligations.
The Quick ratio of VMI (1.50) is better than 77.55% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.26 | ||
| Quick Ratio | 1.5 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 3.75% over the past year.
Measured over the past years, VMI shows a quite strong growth in Earnings Per Share. The EPS has been growing by 18.77% on average per year.
Looking at the last year, VMI shows a decrease in Revenue. The Revenue has decreased by -2.38% in the last year.
VMI shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 8.05% yearly.
EPS 1Y (TTM)3.75%
EPS 3Y16.27%
EPS 5Y18.77%
EPS Q2Q%-0.61%
Revenue 1Y (TTM)-2.38%
Revenue growth 3Y5.19%
Revenue growth 5Y8.05%
Sales Q2Q%1.04%
3.2 Future
VMI is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 9.78% yearly.
The Revenue is expected to grow by 3.15% on average over the next years.
EPS Next Y6.64%
EPS Next 2Y8.03%
EPS Next 3Y9.46%
EPS Next 5Y9.78%
Revenue Next Year1.27%
Revenue Next 2Y3.16%
Revenue Next 3Y3.42%
Revenue Next 5Y3.15%
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less than in the last 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 decreasing.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 20.91 indicates a rather expensive valuation of VMI.
83.67% of the companies in the same industry are more expensive than VMI, based on the Price/Earnings ratio.
VMI's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 26.82.
The Price/Forward Earnings ratio is 17.88, which indicates a rather expensive current valuation of VMI.
79.59% of the companies in the same industry are more expensive than VMI, based on the Price/Forward Earnings ratio.
VMI's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 36.21.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 20.91 | ||
| Fwd PE | 17.88 |
4.2 Price Multiples
75.51% of the companies in the same industry are more expensive than VMI, based on the Enterprise Value to EBITDA ratio.
VMI's Price/Free Cash Flow ratio is rather cheap when compared to the industry. VMI is cheaper than 85.71% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 13.85 | ||
| EV/EBITDA | 12.77 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
VMI has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)3.15
PEG (5Y)1.11
EPS Next 2Y8.03%
EPS Next 3Y9.46%
5. Dividend
5.1 Amount
With a yearly dividend of 0.75%, VMI is not a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 1.61, VMI pays a better dividend. On top of this VMI pays more dividend than 91.84% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 2.39, VMI's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.75% |
5.2 History
On average, the dividend of VMI grows each year by 9.85%, which is quite nice.
VMI has been paying a dividend for at least 10 years, so it has a reliable track record.
VMI has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)9.85%
Div Incr Years0
Div Non Decr Years22
5.3 Sustainability
13.88% of the earnings are spent on dividend by VMI. This is a low number and sustainable payout ratio.
VMI's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP13.88%
EPS Next 2Y8.03%
EPS Next 3Y9.46%
358.53
-5.42 (-1.49%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryConstruction & Engineering
Earnings (Last)
Earnings (Next)
Inst Owners90.91%
Inst Owner Change0.42%
Ins Owners1.36%
Ins Owner Change1.7%
Market Cap7.20B
Analysts80
Price Target351.9 (-1.85%)
Short Float %1.42%
Short Ratio1.58
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.75% |
Yearly Dividend2.4
Dividend Growth(5Y)9.85%
DP13.88%
Div Incr Years0
Div Non Decr Years22
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)1.53%
Min EPS beat(2)-1.82%
Max EPS beat(2)4.89%
EPS beat(4)3
Avg EPS beat(4)6%
Min EPS beat(4)-1.82%
Max EPS beat(4)19.15%
EPS beat(8)7
Avg EPS beat(8)8.94%
EPS beat(12)10
Avg EPS beat(12)7.4%
EPS beat(16)14
Avg EPS beat(16)8.74%
Revenue beat(2)1
Avg Revenue beat(2)-0.14%
Min Revenue beat(2)-1.68%
Max Revenue beat(2)1.4%
Revenue beat(4)1
Avg Revenue beat(4)-0.6%
Min Revenue beat(4)-1.68%
Max Revenue beat(4)1.4%
Revenue beat(8)1
Avg Revenue beat(8)-3.13%
Revenue beat(12)5
Avg Revenue beat(12)-0.12%
Revenue beat(16)8
Avg Revenue beat(16)1.65%
PT rev (1m)0%
PT rev (3m)-1.92%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-1.65%
EPS NY rev (1m)0%
EPS NY rev (3m)0.35%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-1.24%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-0.1%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 20.91 | ||
| Fwd PE | 17.88 | ||
| P/S | 1.77 | ||
| P/FCF | 13.85 | ||
| P/OCF | 11.71 | ||
| P/B | 4.4 | ||
| P/tB | 8.23 | ||
| EV/EBITDA | 12.77 |
EPS(TTM)17.15
EY4.78%
EPS(NY)20.05
Fwd EY5.59%
FCF(TTM)25.9
FCFY7.22%
OCF(TTM)30.62
OCFY8.54%
SpS202.62
BVpS81.46
TBVpS43.56
PEG (NY)3.15
PEG (5Y)1.11
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 10.3% | ||
| ROE | 21.27% | ||
| ROCE | 19.94% | ||
| ROIC | 13.63% | ||
| ROICexc | 14.66% | ||
| ROICexgc | 21.35% | ||
| OM | 12.82% | ||
| PM (TTM) | 8.55% | ||
| GM | 30.15% | ||
| FCFM | 12.78% |
ROA(3y)7.28%
ROA(5y)6.46%
ROE(3y)16.53%
ROE(5y)15.12%
ROIC(3y)11.89%
ROIC(5y)10.15%
ROICexc(3y)12.77%
ROICexc(5y)11.1%
ROICexgc(3y)19%
ROICexgc(5y)16.55%
ROCE(3y)17.42%
ROCE(5y)14.91%
ROICexcg growth 3Y22.29%
ROICexcg growth 5Y14.35%
ROICexc growth 3Y24.1%
ROICexc growth 5Y13.9%
OM growth 3Y15.4%
OM growth 5Y9.34%
PM growth 3Y15.22%
PM growth 5Y10.06%
GM growth 3Y6.46%
GM growth 5Y4.3%
F-Score7
Asset Turnover1.2
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.45 | ||
| Debt/FCF | 1.41 | ||
| Debt/EBITDA | 1.19 | ||
| Cap/Depr | 101.48% | ||
| Cap/Sales | 2.33% | ||
| Interest Coverage | 10.09 | ||
| Cash Conversion | 99.96% | ||
| Profit Quality | 149.47% | ||
| Current Ratio | 2.26 | ||
| Quick Ratio | 1.5 | ||
| Altman-Z | 5.82 |
F-Score7
WACC9.15%
ROIC/WACC1.49
Cap/Depr(3y)92.44%
Cap/Depr(5y)104.5%
Cap/Sales(3y)2.14%
Cap/Sales(5y)2.64%
Profit Quality(3y)124.57%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)3.75%
EPS 3Y16.27%
EPS 5Y18.77%
EPS Q2Q%-0.61%
EPS Next Y6.64%
EPS Next 2Y8.03%
EPS Next 3Y9.46%
EPS Next 5Y9.78%
Revenue 1Y (TTM)-2.38%
Revenue growth 3Y5.19%
Revenue growth 5Y8.05%
Sales Q2Q%1.04%
Revenue Next Year1.27%
Revenue Next 2Y3.16%
Revenue Next 3Y3.42%
Revenue Next 5Y3.15%
EBIT growth 1Y17.03%
EBIT growth 3Y21.39%
EBIT growth 5Y18.14%
EBIT Next Year23.14%
EBIT Next 3Y11.1%
EBIT Next 5Y10.25%
FCF growth 1Y102.85%
FCF growth 3YN/A
FCF growth 5Y18.6%
OCF growth 1Y78.23%
OCF growth 3Y105.55%
OCF growth 5Y13.24%