VERRA MOBILITY CORP (VRRM) Stock Fundamental Analysis
NASDAQ:VRRM - Nasdaq - US92511U1025 - Common Stock - Currency: USD
VRRM gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 82 industry peers in the IT Services industry. While VRRM has a great profitability rating, there are some minor concerns on its financial health. VRRM has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
In the past year VRRM was profitable.
VRRM had a positive operating cash flow in the past year.
VRRM had positive earnings in 4 of the past 5 years.
In the past 5 years VRRM always reported a positive cash flow from operatings.
1.2 Ratios
VRRM has a Return On Assets (2.11%) which is comparable to the rest of the industry.
The Return On Equity of VRRM (11.56%) is better than 65.85% of its industry peers.
VRRM's Return On Invested Capital of 12.88% is amongst the best of the industry. VRRM outperforms 80.49% of its industry peers.
VRRM had an Average Return On Invested Capital over the past 3 years of 10.27%. This is significantly below the industry average of 21.78%.
The 3 year average ROIC (10.27%) for VRRM is below the current ROIC(12.88%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.11% | ||
| ROE | 11.56% | ||
| ROIC | 12.88% |
ROA(3y)3.47%
ROA(5y)2.46%
ROE(3y)21.81%
ROE(5y)15.98%
ROIC(3y)10.27%
ROIC(5y)7.68%
1.3 Margins
With a Profit Margin value of 3.88%, VRRM perfoms like the industry average, outperforming 58.54% of the companies in the same industry.
VRRM's Profit Margin has been stable in the last couple of years.
VRRM's Operating Margin of 26.45% is amongst the best of the industry. VRRM outperforms 97.56% of its industry peers.
In the last couple of years the Operating Margin of VRRM has grown nicely.
With an excellent Gross Margin value of 94.48%, VRRM belongs to the best of the industry, outperforming 100.00% of the companies in the same industry.
In the last couple of years the Gross Margin of VRRM has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 26.45% | ||
| PM (TTM) | 3.88% | ||
| GM | 94.48% |
OM growth 3Y9.3%
OM growth 5Y3.04%
PM growth 3Y-21.94%
PM growth 5Y-1.26%
GM growth 3Y0.41%
GM growth 5Y-0.19%
2. Health
2.1 Basic Checks
VRRM has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
The number of shares outstanding for VRRM has been reduced compared to 1 year ago.
The number of shares outstanding for VRRM has been increased compared to 5 years ago.
The debt/assets ratio for VRRM is higher compared to a year ago.
2.2 Solvency
An Altman-Z score of 2.70 indicates that VRRM is not a great score, but indicates only limited risk for bankruptcy at the moment.
The Altman-Z score of VRRM (2.70) is comparable to the rest of the industry.
VRRM has a debt to FCF ratio of 5.92. This is a neutral value as VRRM would need 5.92 years to pay back of all of its debts.
With a Debt to FCF ratio value of 5.92, VRRM perfoms like the industry average, outperforming 48.78% of the companies in the same industry.
A Debt/Equity ratio of 3.45 is on the high side and indicates that VRRM has dependencies on debt financing.
VRRM has a Debt to Equity ratio of 3.45. This is amonst the worse of the industry: VRRM underperforms 84.15% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 3.45 | ||
| Debt/FCF | 5.92 | ||
| Altman-Z | 2.7 |
ROIC/WACC1.36
WACC9.49%
2.3 Liquidity
A Current Ratio of 2.19 indicates that VRRM has no problem at all paying its short term obligations.
VRRM has a better Current ratio (2.19) than 65.85% of its industry peers.
VRRM has a Quick Ratio of 2.10. This indicates that VRRM is financially healthy and has no problem in meeting its short term obligations.
Looking at the Quick ratio, with a value of 2.10, VRRM is in the better half of the industry, outperforming 65.85% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.19 | ||
| Quick Ratio | 2.1 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 15.60% over the past year.
The Earnings Per Share has been growing by 42.41% on average over the past years. This is a very strong growth
Looking at the last year, VRRM shows a small growth in Revenue. The Revenue has grown by 6.90% in the last year.
Measured over the past years, VRRM shows a quite strong growth in Revenue. The Revenue has been growing by 14.40% on average per year.
EPS 1Y (TTM)15.6%
EPS 3Y27.03%
EPS 5Y42.41%
EPS Q2Q%11.11%
Revenue 1Y (TTM)6.9%
Revenue growth 3Y16.88%
Revenue growth 5Y14.4%
Sales Q2Q%6.45%
3.2 Future
Based on estimates for the next years, VRRM will show a quite strong growth in Earnings Per Share. The EPS will grow by 12.27% on average per year.
VRRM is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 7.16% yearly.
EPS Next Y9.23%
EPS Next 2Y11.58%
EPS Next 3Y12.27%
EPS Next 5YN/A
Revenue Next Year5.8%
Revenue Next 2Y6.62%
Revenue Next 3Y7.16%
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 decreasing.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 19.28, the valuation of VRRM can be described as rather expensive.
65.85% of the companies in the same industry are more expensive than VRRM, based on the Price/Earnings ratio.
VRRM is valuated rather cheaply when we compare the Price/Earnings ratio to 26.43, which is the current average of the S&P500 Index.
The Price/Forward Earnings ratio is 15.86, which indicates a correct valuation of VRRM.
69.51% of the companies in the same industry are more expensive than VRRM, based on the Price/Forward Earnings ratio.
When comparing the Price/Forward Earnings ratio of VRRM to the average of the S&P500 Index (22.17), we can say VRRM is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.28 | ||
| Fwd PE | 15.86 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, VRRM is valued a bit cheaper than the industry average as 65.85% of the companies are valued more expensively.
Based on the Price/Free Cash Flow ratio, VRRM is valued a bit cheaper than 60.98% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 22.2 | ||
| EV/EBITDA | 13.82 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
VRRM has a very decent profitability rating, which may justify a higher PE ratio.
A more expensive valuation may be justified as VRRM's earnings are expected to grow with 12.27% in the coming years.
PEG (NY)2.09
PEG (5Y)0.45
EPS Next 2Y11.58%
EPS Next 3Y12.27%
5. Dividend
5.1 Amount
VRRM does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
24.29
+0.17 (+0.7%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustryIT Services
Earnings (Last)
Earnings (Next)
Inst Owners100.53%
Inst Owner Change-0.32%
Ins Owners0.75%
Ins Owner Change1.71%
Market Cap3.87B
Analysts84.62
Price Target29.67 (22.15%)
Short Float %1.46%
Short Ratio1.8
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)5.66%
Min EPS beat(2)2.43%
Max EPS beat(2)8.88%
EPS beat(4)3
Avg EPS beat(4)3.24%
Min EPS beat(4)-0.63%
Max EPS beat(4)8.88%
EPS beat(8)6
Avg EPS beat(8)1.65%
EPS beat(12)9
Avg EPS beat(12)4.47%
EPS beat(16)11
Avg EPS beat(16)3.76%
Revenue beat(2)1
Avg Revenue beat(2)-0.31%
Min Revenue beat(2)-1.5%
Max Revenue beat(2)0.89%
Revenue beat(4)1
Avg Revenue beat(4)-1.03%
Min Revenue beat(4)-2.43%
Max Revenue beat(4)0.89%
Revenue beat(8)4
Avg Revenue beat(8)-0.13%
Revenue beat(12)6
Avg Revenue beat(12)0.1%
Revenue beat(16)10
Avg Revenue beat(16)1.4%
PT rev (1m)0%
PT rev (3m)0.29%
EPS NQ rev (1m)0.44%
EPS NQ rev (3m)-0.6%
EPS NY rev (1m)-0.11%
EPS NY rev (3m)1.77%
Revenue NQ rev (1m)-0.27%
Revenue NQ rev (3m)-0.86%
Revenue NY rev (1m)-0.19%
Revenue NY rev (3m)-0.36%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.28 | ||
| Fwd PE | 15.86 | ||
| P/S | 4.34 | ||
| P/FCF | 22.2 | ||
| P/OCF | 15.35 | ||
| P/B | 12.93 | ||
| P/tB | N/A | ||
| EV/EBITDA | 13.82 |
EPS(TTM)1.26
EY5.19%
EPS(NY)1.53
Fwd EY6.3%
FCF(TTM)1.09
FCFY4.5%
OCF(TTM)1.58
OCFY6.51%
SpS5.6
BVpS1.88
TBVpS-4.1
PEG (NY)2.09
PEG (5Y)0.45
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.11% | ||
| ROE | 11.56% | ||
| ROCE | 16.3% | ||
| ROIC | 12.88% | ||
| ROICexc | 13.92% | ||
| ROICexgc | 48.3% | ||
| OM | 26.45% | ||
| PM (TTM) | 3.88% | ||
| GM | 94.48% | ||
| FCFM | 19.54% |
ROA(3y)3.47%
ROA(5y)2.46%
ROE(3y)21.81%
ROE(5y)15.98%
ROIC(3y)10.27%
ROIC(5y)7.68%
ROICexc(3y)11.02%
ROICexc(5y)8.25%
ROICexgc(3y)50.23%
ROICexgc(5y)40.02%
ROCE(3y)12.99%
ROCE(5y)9.72%
ROICexcg growth 3Y9.79%
ROICexcg growth 5Y-1.24%
ROICexc growth 3Y34.5%
ROICexc growth 5Y14.79%
OM growth 3Y9.3%
OM growth 5Y3.04%
PM growth 3Y-21.94%
PM growth 5Y-1.26%
GM growth 3Y0.41%
GM growth 5Y-0.19%
F-Score5
Asset Turnover0.54
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 3.45 | ||
| Debt/FCF | 5.92 | ||
| Debt/EBITDA | 2.99 | ||
| Cap/Depr | 71.31% | ||
| Cap/Sales | 8.72% | ||
| Interest Coverage | 3.25 | ||
| Cash Conversion | 73.07% | ||
| Profit Quality | 503.65% | ||
| Current Ratio | 2.19 | ||
| Quick Ratio | 2.1 | ||
| Altman-Z | 2.7 |
F-Score5
WACC9.49%
ROIC/WACC1.36
Cap/Depr(3y)50.29%
Cap/Depr(5y)38.63%
Cap/Sales(3y)7.2%
Cap/Sales(5y)6.46%
Profit Quality(3y)310.13%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)15.6%
EPS 3Y27.03%
EPS 5Y42.41%
EPS Q2Q%11.11%
EPS Next Y9.23%
EPS Next 2Y11.58%
EPS Next 3Y12.27%
EPS Next 5YN/A
Revenue 1Y (TTM)6.9%
Revenue growth 3Y16.88%
Revenue growth 5Y14.4%
Sales Q2Q%6.45%
Revenue Next Year5.8%
Revenue Next 2Y6.62%
Revenue Next 3Y7.16%
Revenue Next 5YN/A
EBIT growth 1Y22.3%
EBIT growth 3Y27.75%
EBIT growth 5Y17.88%
EBIT Next Year30.2%
EBIT Next 3Y15.29%
EBIT Next 5YN/A
FCF growth 1Y-1.55%
FCF growth 3Y-3.15%
FCF growth 5Y7.98%
OCF growth 1Y8.6%
OCF growth 3Y5%
OCF growth 5Y10.82%