VAREX IMAGING CORP (VREX) Stock Fundamental Analysis
NASDAQ:VREX - Nasdaq - US92214X1063 - Common Stock - Currency: USD
VREX gets a fundamental rating of 4 out of 10. The analysis compared the fundamentals against 189 industry peers in the Health Care Equipment & Supplies industry. VREX has only an average score on both its financial health and profitability. VREX is valued quite cheap, while showing a decent growth score. This is a good combination!
1. Profitability
1.1 Basic Checks
VREX had positive earnings in the past year.
VREX had a positive operating cash flow in the past year.
The reported net income has been mixed in the past 5 years: VREX reported negative net income in multiple years.
In the past 5 years VREX always reported a positive cash flow from operatings.
1.2 Ratios
Looking at the Return On Assets, with a value of -3.57%, VREX is in the better half of the industry, outperforming 67.20% of the companies in the same industry.
The Return On Equity of VREX (-8.79%) is better than 67.20% of its industry peers.
VREX has a better Return On Invested Capital (2.61%) than 71.96% of its industry peers.
The Average Return On Invested Capital over the past 3 years for VREX is below the industry average of 7.84%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -3.57% | ||
| ROE | -8.79% | ||
| ROIC | 2.61% |
ROA(3y)0.83%
ROA(5y)-0.21%
ROE(3y)1.75%
ROE(5y)-0.79%
ROIC(3y)5.22%
ROIC(5y)N/A
1.3 Margins
Looking at the Operating Margin, with a value of 4.76%, VREX is in the better half of the industry, outperforming 72.49% of the companies in the same industry.
In the last couple of years the Operating Margin of VREX has declined.
VREX has a worse Gross Margin (32.69%) than 72.49% of its industry peers.
In the last couple of years the Gross Margin of VREX has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 4.76% | ||
| PM (TTM) | N/A | ||
| GM | 32.69% |
OM growth 3Y-20.79%
OM growth 5Y-6.75%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y-0.94%
GM growth 5Y-0.37%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so VREX is destroying value.
The number of shares outstanding for VREX has been increased compared to 1 year ago.
The number of shares outstanding for VREX has been increased compared to 5 years ago.
VREX has a worse debt/assets ratio than last year.
2.2 Solvency
Based on the Altman-Z score of 1.48, we must say that VREX is in the distress zone and has some risk of bankruptcy.
Looking at the Altman-Z score, with a value of 1.48, VREX is in line with its industry, outperforming 57.67% of the companies in the same industry.
The Debt to FCF ratio of VREX is 22.22, which is on the high side as it means it would take VREX, 22.22 years of fcf income to pay off all of its debts.
Looking at the Debt to FCF ratio, with a value of 22.22, VREX is in the better half of the industry, outperforming 71.43% of the companies in the same industry.
VREX has a Debt/Equity ratio of 1.06. This is a high value indicating a heavy dependency on external financing.
VREX has a worse Debt to Equity ratio (1.06) than 75.66% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.06 | ||
| Debt/FCF | 22.22 | ||
| Altman-Z | 1.48 |
ROIC/WACC0.4
WACC6.6%
2.3 Liquidity
A Current Ratio of 4.36 indicates that VREX has no problem at all paying its short term obligations.
Looking at the Current ratio, with a value of 4.36, VREX is in the better half of the industry, outperforming 67.72% of the companies in the same industry.
VREX has a Quick Ratio of 2.50. This indicates that VREX is financially healthy and has no problem in meeting its short term obligations.
VREX has a Quick ratio of 2.50. This is comparable to the rest of the industry: VREX outperforms 57.67% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 4.36 | ||
| Quick Ratio | 2.5 |
3. Growth
3.1 Past
VREX shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -36.54%.
The earnings per share for VREX have been decreasing by -15.81% on average. This is quite bad
The Revenue has decreased by -9.22% in the past year.
VREX shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 0.77% yearly.
EPS 1Y (TTM)-36.54%
EPS 3Y-24.54%
EPS 5Y-15.81%
EPS Q2Q%62.5%
Revenue 1Y (TTM)-9.22%
Revenue growth 3Y-0.29%
Revenue growth 5Y0.77%
Sales Q2Q%3.25%
3.2 Future
The Earnings Per Share is expected to grow by 24.48% on average over the next years. This is a very strong growth
Based on estimates for the next years, VREX will show a small growth in Revenue. The Revenue will grow by 4.33% on average per year.
EPS Next Y5.65%
EPS Next 2Y29.15%
EPS Next 3Y24.48%
EPS Next 5YN/A
Revenue Next Year2.91%
Revenue Next 2Y3.31%
Revenue Next 3Y4.33%
Revenue Next 5YN/A
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 11.36, the valuation of VREX can be described as reasonable.
Based on the Price/Earnings ratio, VREX is valued cheaply inside the industry as 94.18% of the companies are valued more expensively.
Compared to an average S&P500 Price/Earnings ratio of 24.95, VREX is valued rather cheaply.
A Price/Forward Earnings ratio of 8.18 indicates a reasonable valuation of VREX.
96.83% of the companies in the same industry are more expensive than VREX, based on the Price/Forward Earnings ratio.
VREX is valuated cheaply when we compare the Price/Forward Earnings ratio to 20.99, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 11.36 | ||
| Fwd PE | 8.18 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of VREX indicates a rather cheap valuation: VREX is cheaper than 92.59% of the companies listed in the same industry.
VREX's Price/Free Cash Flow ratio is rather cheap when compared to the industry. VREX is cheaper than 93.12% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 11.98 | ||
| EV/EBITDA | 9.24 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
VREX's earnings are expected to grow with 24.48% in the coming years. This may justify a more expensive valuation.
PEG (NY)2.01
PEG (5Y)N/A
EPS Next 2Y29.15%
EPS Next 3Y24.48%
5. Dividend
5.1 Amount
VREX does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
7.5
-0.02 (-0.27%)
Chartmill FA Rating
GICS SectorHealth Care
GICS IndustryGroupHealth Care Equipment & Services
GICS IndustryHealth Care Equipment & Supplies
Earnings (Last)
Earnings (Next)
Inst Owners95.77%
Inst Owner Change-1.11%
Ins Owners1.64%
Ins Owner Change13.61%
Market Cap309.00M
Analysts83.64
Price Target21.62 (188.27%)
Short Float %2.34%
Short Ratio1.9
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Yearly DividendN/A
Dividend Growth(5Y)N/A
DP0%
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)100.02%
Min EPS beat(2)87.15%
Max EPS beat(2)112.89%
EPS beat(4)2
Avg EPS beat(4)36.73%
Min EPS beat(4)-29%
Max EPS beat(4)112.89%
EPS beat(8)5
Avg EPS beat(8)22.71%
EPS beat(12)9
Avg EPS beat(12)25.64%
EPS beat(16)12
Avg EPS beat(16)29.26%
Revenue beat(2)1
Avg Revenue beat(2)-0.98%
Min Revenue beat(2)-3.1%
Max Revenue beat(2)1.14%
Revenue beat(4)1
Avg Revenue beat(4)-1.39%
Min Revenue beat(4)-3.1%
Max Revenue beat(4)1.14%
Revenue beat(8)2
Avg Revenue beat(8)-0.85%
Revenue beat(12)5
Avg Revenue beat(12)-0.23%
Revenue beat(16)8
Avg Revenue beat(16)0.12%
PT rev (1m)0.95%
PT rev (3m)-4.5%
EPS NQ rev (1m)0%
EPS NQ rev (3m)20.57%
EPS NY rev (1m)-1.06%
EPS NY rev (3m)-3.39%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)1.98%
Revenue NY rev (1m)0%
Revenue NY rev (3m)0.64%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 11.36 | ||
| Fwd PE | 8.18 | ||
| P/S | 0.38 | ||
| P/FCF | 11.98 | ||
| P/OCF | 6.65 | ||
| P/B | 0.57 | ||
| P/tB | 1.29 | ||
| EV/EBITDA | 9.24 |
EPS(TTM)0.66
EY8.8%
EPS(NY)0.92
Fwd EY12.23%
FCF(TTM)0.63
FCFY8.35%
OCF(TTM)1.13
OCFY15.05%
SpS19.92
BVpS13.11
TBVpS5.8
PEG (NY)2.01
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -3.57% | ||
| ROE | -8.79% | ||
| ROCE | 3.31% | ||
| ROIC | 2.61% | ||
| ROICexc | 3.19% | ||
| ROICexgc | 4.63% | ||
| OM | 4.76% | ||
| PM (TTM) | N/A | ||
| GM | 32.69% | ||
| FCFM | 3.14% |
ROA(3y)0.83%
ROA(5y)-0.21%
ROE(3y)1.75%
ROE(5y)-0.79%
ROIC(3y)5.22%
ROIC(5y)N/A
ROICexc(3y)6.12%
ROICexc(5y)N/A
ROICexgc(3y)9.48%
ROICexgc(5y)N/A
ROCE(3y)6.6%
ROCE(5y)N/A
ROICexcg growth 3Y-22.06%
ROICexcg growth 5Y-8.2%
ROICexc growth 3Y-20.52%
ROICexc growth 5Y-5.73%
OM growth 3Y-20.79%
OM growth 5Y-6.75%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y-0.94%
GM growth 5Y-0.37%
F-Score4
Asset Turnover0.62
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.06 | ||
| Debt/FCF | 22.22 | ||
| Debt/EBITDA | 8.33 | ||
| Cap/Depr | 70.17% | ||
| Cap/Sales | 2.52% | ||
| Interest Coverage | 1.42 | ||
| Cash Conversion | 67.78% | ||
| Profit Quality | N/A | ||
| Current Ratio | 4.36 | ||
| Quick Ratio | 2.5 | ||
| Altman-Z | 1.48 |
F-Score4
WACC6.6%
ROIC/WACC0.4
Cap/Depr(3y)70.75%
Cap/Depr(5y)62.44%
Cap/Sales(3y)2.7%
Cap/Sales(5y)2.63%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-36.54%
EPS 3Y-24.54%
EPS 5Y-15.81%
EPS Q2Q%62.5%
EPS Next Y5.65%
EPS Next 2Y29.15%
EPS Next 3Y24.48%
EPS Next 5YN/A
Revenue 1Y (TTM)-9.22%
Revenue growth 3Y-0.29%
Revenue growth 5Y0.77%
Sales Q2Q%3.25%
Revenue Next Year2.91%
Revenue Next 2Y3.31%
Revenue Next 3Y4.33%
Revenue Next 5YN/A
EBIT growth 1Y-42.75%
EBIT growth 3Y-21.02%
EBIT growth 5Y-6.03%
EBIT Next Year99.22%
EBIT Next 3Y36.92%
EBIT Next 5YN/A
FCF growth 1Y227.09%
FCF growth 3Y-35.91%
FCF growth 5Y-17.1%
OCF growth 1Y1837.5%
OCF growth 3Y-20.06%
OCF growth 5Y-8.03%