Veren Inc (VRN) Stock Fundamental Analysis
NYSE:VRN - New York Stock Exchange, Inc. - CA92340V1076 - Common Stock - Currency: USD
We assign a fundamental rating of 5 out of 10 to VRN. VRN was compared to 213 industry peers in the Oil, Gas & Consumable Fuels industry. There are concerns on the financial health of VRN while its profitability can be described as average. VRN may be a bit undervalued, certainly considering the very reasonable score on growth
1. Profitability
1.1 Basic Checks
VRN had positive earnings in the past year.
In the past year VRN had a positive cash flow from operations.
VRN had positive earnings in 4 of the past 5 years.
In the past 5 years VRN always reported a positive cash flow from operatings.
1.2 Ratios
VRN has a Return On Assets of 2.33%. This is comparable to the rest of the industry: VRN outperforms 42.99% of its industry peers.
The Return On Equity of VRN (4.04%) is comparable to the rest of the industry.
VRN has a better Return On Invested Capital (8.09%) than 64.02% of its industry peers.
VRN had an Average Return On Invested Capital over the past 3 years of 10.88%. This is significantly below the industry average of 23.55%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.33% | ||
| ROE | 4.04% | ||
| ROIC | 8.09% |
ROA(3y)7.48%
ROA(5y)2.06%
ROE(3y)11.73%
ROE(5y)-2.07%
ROIC(3y)10.88%
ROIC(5y)8.73%
1.3 Margins
VRN has a Profit Margin of 6.88%. This is comparable to the rest of the industry: VRN outperforms 48.60% of its industry peers.
In the last couple of years the Profit Margin of VRN has declined.
VRN's Operating Margin of 27.16% is fine compared to the rest of the industry. VRN outperforms 61.68% of its industry peers.
VRN's Operating Margin has improved in the last couple of years.
The Gross Margin of VRN (72.71%) is better than 82.71% of its industry peers.
VRN's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 27.16% | ||
| PM (TTM) | 6.88% | ||
| GM | 72.71% |
OM growth 3Y-11.86%
OM growth 5Y3.88%
PM growth 3Y-56.49%
PM growth 5YN/A
GM growth 3Y-1.79%
GM growth 5Y-0.31%
2. Health
2.1 Basic Checks
VRN has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
Compared to 1 year ago, VRN has less shares outstanding
The number of shares outstanding for VRN has been increased compared to 5 years ago.
The debt/assets ratio for VRN has been reduced compared to a year ago.
2.2 Solvency
Based on the Altman-Z score of -0.01, we must say that VRN is in the distress zone and has some risk of bankruptcy.
VRN's Altman-Z score of -0.01 is on the low side compared to the rest of the industry. VRN is outperformed by 69.16% of its industry peers.
VRN has a debt to FCF ratio of 6.16. This is a slightly negative value and a sign of low solvency as VRN would need 6.16 years to pay back of all of its debts.
VRN's Debt to FCF ratio of 6.16 is fine compared to the rest of the industry. VRN outperforms 62.15% of its industry peers.
A Debt/Equity ratio of 0.37 indicates that VRN is not too dependend on debt financing.
The Debt to Equity ratio of VRN (0.37) is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.37 | ||
| Debt/FCF | 6.16 | ||
| Altman-Z | -0.01 |
ROIC/WACC1.06
WACC7.66%
2.3 Liquidity
A Current Ratio of 0.57 indicates that VRN may have some problems paying its short term obligations.
The Current ratio of VRN (0.57) is worse than 81.31% of its industry peers.
A Quick Ratio of 0.57 indicates that VRN may have some problems paying its short term obligations.
Looking at the Quick ratio, with a value of 0.57, VRN is doing worse than 74.77% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.57 | ||
| Quick Ratio | 0.57 |
3. Growth
3.1 Past
The earnings per share for VRN have decreased strongly by -53.13% in the last year.
Measured over the past years, VRN shows a very negative growth in Earnings Per Share. The EPS has been decreasing by -14.10% on average per year.
Looking at the last year, VRN shows a very strong growth in Revenue. The Revenue has grown by 24.52%.
Measured over the past years, VRN shows a small growth in Revenue. The Revenue has been growing by 6.66% on average per year.
EPS 1Y (TTM)-53.13%
EPS 3Y-14.1%
EPS 5YN/A
EPS Q2Q%-85.88%
Revenue 1Y (TTM)24.52%
Revenue growth 3Y11.97%
Revenue growth 5Y6.66%
Sales Q2Q%32.55%
3.2 Future
The Earnings Per Share is expected to grow by 21.31% on average over the next years. This is a very strong growth
The Revenue is expected to grow by 4.59% on average over the next years.
EPS Next Y189.53%
EPS Next 2Y52.32%
EPS Next 3Y21.31%
EPS Next 5YN/A
Revenue Next Year3.46%
Revenue Next 2Y2.34%
Revenue Next 3Y1.23%
Revenue Next 5Y4.59%
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.
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
With a Price/Earnings ratio of 18.78, VRN is valued on the expensive side.
Compared to the rest of the industry, the Price/Earnings ratio of VRN is on the same level as its industry peers.
When comparing the Price/Earnings ratio of VRN to the average of the S&P500 Index (26.35), we can say VRN is valued slightly cheaper.
With a Price/Forward Earnings ratio of 6.44, the valuation of VRN can be described as very cheap.
Compared to the rest of the industry, the Price/Forward Earnings ratio of VRN indicates a rather cheap valuation: VRN is cheaper than 85.98% of the companies listed in the same industry.
VRN's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 22.19.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 18.78 | ||
| Fwd PE | 6.44 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, VRN is valued cheaper than 83.64% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, VRN is valued a bit cheaper than 74.77% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 10.32 | ||
| EV/EBITDA | 3.39 |
4.3 Compensation for Growth
VRN's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
A more expensive valuation may be justified as VRN's earnings are expected to grow with 21.31% in the coming years.
PEG (NY)0.1
PEG (5Y)N/A
EPS Next 2Y52.32%
EPS Next 3Y21.31%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 5.03%, VRN is a good candidate for dividend investing.
VRN's Dividend Yield is a higher than the industry average which is at 6.54.
VRN's Dividend Yield is rather good when compared to the S&P500 average which is at 2.40.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 5.03% |
5.2 History
The dividend of VRN is nicely growing with an annual growth rate of 62.49%!
VRN has been paying a dividend for over 5 years, so it has already some track record.
VRN has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)62.49%
Div Incr Years3
Div Non Decr Years3
5.3 Sustainability
104.13% of the earnings are spent on dividend by VRN. This is not a sustainable payout ratio.
The dividend of VRN is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP104.13%
EPS Next 2Y52.32%
EPS Next 3Y21.31%
6.01
0 (0%)
Chartmill FA Rating
GICS SectorEnergy
GICS IndustryGroupEnergy
GICS IndustryOil, Gas & Consumable Fuels
Earnings (Last)
Earnings (Next)
Inst Owners44.99%
Inst Owner Change13.62%
Ins Owners0.7%
Ins Owner ChangeN/A
Market Cap3.68B
Analysts81.25
Price Target8.26 (37.44%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 5.03% |
Yearly Dividend0.33
Dividend Growth(5Y)62.49%
DP104.13%
Div Incr Years3
Div Non Decr Years3
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)12.12%
Min EPS beat(2)-20.31%
Max EPS beat(2)44.56%
EPS beat(4)2
Avg EPS beat(4)-60.8%
Min EPS beat(4)-278.4%
Max EPS beat(4)44.56%
EPS beat(8)3
Avg EPS beat(8)-39.62%
EPS beat(12)5
Avg EPS beat(12)-13.85%
EPS beat(16)5
Avg EPS beat(16)-14.22%
Revenue beat(2)1
Avg Revenue beat(2)6.25%
Min Revenue beat(2)-4.22%
Max Revenue beat(2)16.73%
Revenue beat(4)2
Avg Revenue beat(4)-0.37%
Min Revenue beat(4)-19.96%
Max Revenue beat(4)16.73%
Revenue beat(8)2
Avg Revenue beat(8)-9.07%
Revenue beat(12)4
Avg Revenue beat(12)-5.07%
Revenue beat(16)8
Avg Revenue beat(16)-0.22%
PT rev (1m)4.74%
PT rev (3m)3.09%
EPS NQ rev (1m)-1.09%
EPS NQ rev (3m)16.84%
EPS NY rev (1m)0%
EPS NY rev (3m)15.32%
Revenue NQ rev (1m)3.41%
Revenue NQ rev (3m)2.93%
Revenue NY rev (1m)5.07%
Revenue NY rev (3m)5.12%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 18.78 | ||
| Fwd PE | 6.44 | ||
| P/S | 1.29 | ||
| P/FCF | 10.32 | ||
| P/OCF | 2.43 | ||
| P/B | 0.76 | ||
| P/tB | 0.79 | ||
| EV/EBITDA | 3.39 |
EPS(TTM)0.32
EY5.32%
EPS(NY)0.93
Fwd EY15.52%
FCF(TTM)0.58
FCFY9.69%
OCF(TTM)2.47
OCFY41.11%
SpS4.65
BVpS7.91
TBVpS7.62
PEG (NY)0.1
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.33% | ||
| ROE | 4.04% | ||
| ROCE | 10.21% | ||
| ROIC | 8.09% | ||
| ROICexc | 8.11% | ||
| ROICexgc | 8.3% | ||
| OM | 27.16% | ||
| PM (TTM) | 6.88% | ||
| GM | 72.71% | ||
| FCFM | 12.53% |
ROA(3y)7.48%
ROA(5y)2.06%
ROE(3y)11.73%
ROE(5y)-2.07%
ROIC(3y)10.88%
ROIC(5y)8.73%
ROICexc(3y)11.09%
ROICexc(5y)8.86%
ROICexgc(3y)11.37%
ROICexgc(5y)9.09%
ROCE(3y)13.72%
ROCE(5y)11.02%
ROICexcg growth 3Y-9.61%
ROICexcg growth 5Y7.92%
ROICexc growth 3Y-9.52%
ROICexc growth 5Y7.96%
OM growth 3Y-11.86%
OM growth 5Y3.88%
PM growth 3Y-56.49%
PM growth 5YN/A
GM growth 3Y-1.79%
GM growth 5Y-0.31%
F-Score6
Asset Turnover0.34
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.37 | ||
| Debt/FCF | 6.16 | ||
| Debt/EBITDA | 1.03 | ||
| Cap/Depr | 120.62% | ||
| Cap/Sales | 40.64% | ||
| Interest Coverage | 5.33 | ||
| Cash Conversion | 87.37% | ||
| Profit Quality | 182.07% | ||
| Current Ratio | 0.57 | ||
| Quick Ratio | 0.57 | ||
| Altman-Z | -0.01 |
F-Score6
WACC7.66%
ROIC/WACC1.06
Cap/Depr(3y)230.75%
Cap/Depr(5y)176.18%
Cap/Sales(3y)74.7%
Cap/Sales(5y)63.8%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-53.13%
EPS 3Y-14.1%
EPS 5YN/A
EPS Q2Q%-85.88%
EPS Next Y189.53%
EPS Next 2Y52.32%
EPS Next 3Y21.31%
EPS Next 5YN/A
Revenue 1Y (TTM)24.52%
Revenue growth 3Y11.97%
Revenue growth 5Y6.66%
Sales Q2Q%32.55%
Revenue Next Year3.46%
Revenue Next 2Y2.34%
Revenue Next 3Y1.23%
Revenue Next 5Y4.59%
EBIT growth 1Y-6.28%
EBIT growth 3Y-1.31%
EBIT growth 5Y10.81%
EBIT Next Year58.77%
EBIT Next 3Y12.73%
EBIT Next 5Y10.8%
FCF growth 1Y118.84%
FCF growth 3Y51.96%
FCF growth 5Y3.41%
OCF growth 1Y-3.82%
OCF growth 3Y12.18%
OCF growth 5Y3.91%