VERTIV HOLDINGS CO-A (VRT) Stock Fundamental Analysis
NYSE:VRT - New York Stock Exchange, Inc. - US92537N1081 - Common Stock - Currency: USD
VRT gets a fundamental rating of 7 out of 10. The analysis compared the fundamentals against 94 industry peers in the Electrical Equipment industry. VRT gets an excellent profitability rating and is at the same time showing great financial health properties. VRT is growing strongly while it is still valued neutral. This is a good combination! This makes VRT very considerable for growth and quality investing!
1. Profitability
1.1 Basic Checks
In the past year VRT was profitable.
In the past year VRT had a positive cash flow from operations.
VRT had positive earnings in 4 of the past 5 years.
Of the past 5 years VRT 4 years had a positive operating cash flow.
1.2 Ratios
VRT has a Return On Assets of 7.05%. This is amongst the best in the industry. VRT outperforms 86.17% of its industry peers.
VRT has a Return On Equity of 24.98%. This is amongst the best in the industry. VRT outperforms 94.68% of its industry peers.
VRT has a better Return On Invested Capital (17.71%) than 96.81% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for VRT is in line with the industry average of 9.89%.
The 3 year average ROIC (10.93%) for VRT is below the current ROIC(17.71%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.05% | ||
| ROE | 24.98% | ||
| ROIC | 17.71% |
ROA(3y)4.09%
ROA(5y)1.51%
ROE(3y)16.17%
ROE(5y)-1.39%
ROIC(3y)10.93%
ROIC(5y)8.89%
1.3 Margins
The Profit Margin of VRT (7.92%) is better than 84.04% of its industry peers.
In the last couple of years the Profit Margin of VRT has grown nicely.
Looking at the Operating Margin, with a value of 17.49%, VRT belongs to the top of the industry, outperforming 92.55% of the companies in the same industry.
In the last couple of years the Operating Margin of VRT has grown nicely.
VRT has a better Gross Margin (36.32%) than 85.11% of its industry peers.
In the last couple of years the Gross Margin of VRT has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 17.49% | ||
| PM (TTM) | 7.92% | ||
| GM | 36.32% |
OM growth 3Y46.77%
OM growth 5Y27.72%
PM growth 3Y37.26%
PM growth 5YN/A
GM growth 3Y6.33%
GM growth 5Y2.24%
2. Health
2.1 Basic Checks
VRT has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
Compared to 1 year ago, VRT has less shares outstanding
Compared to 5 years ago, VRT has more shares outstanding
The debt/assets ratio for VRT has been reduced compared to a year ago.
2.2 Solvency
VRT has an Altman-Z score of 5.99. This indicates that VRT is financially healthy and has little risk of bankruptcy at the moment.
VRT has a Altman-Z score of 5.99. This is amongst the best in the industry. VRT outperforms 88.30% of its industry peers.
The Debt to FCF ratio of VRT is 2.25, which is a good value as it means it would take VRT, 2.25 years of fcf income to pay off all of its debts.
With an excellent Debt to FCF ratio value of 2.25, VRT belongs to the best of the industry, outperforming 86.17% of the companies in the same industry.
A Debt/Equity ratio of 1.09 is on the high side and indicates that VRT has dependencies on debt financing.
The Debt to Equity ratio of VRT (1.09) is worse than 69.15% of its industry peers.
Even though the debt/equity ratio score it not favorable for VRT, it has very limited outstanding debt, so we won't put too much weight on the DE evaluation.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.09 | ||
| Debt/FCF | 2.25 | ||
| Altman-Z | 5.99 |
ROIC/WACC2.03
WACC8.71%
2.3 Liquidity
A Current Ratio of 1.72 indicates that VRT should not have too much problems paying its short term obligations.
VRT has a Current ratio (1.72) which is comparable to the rest of the industry.
VRT has a Quick Ratio of 1.28. This is a normal value and indicates that VRT is financially healthy and should not expect problems in meeting its short term obligations.
VRT has a Quick ratio (1.28) which is comparable to the rest of the industry.
VRT does not score too well on the current and quick ratio evaluation. However, as it has excellent solvency and profitability, these ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.72 | ||
| Quick Ratio | 1.28 |
3. Growth
3.1 Past
VRT shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 55.33%, which is quite impressive.
Measured over the past years, VRT shows a very strong growth in Earnings Per Share. The EPS has been growing by 55.36% on average per year.
The Revenue has grown by 20.45% in the past year. This is a very strong growth!
Measured over the past years, VRT shows a quite strong growth in Revenue. The Revenue has been growing by 12.57% on average per year.
EPS 1Y (TTM)55.33%
EPS 3Y55.36%
EPS 5YN/A
EPS Q2Q%48.84%
Revenue 1Y (TTM)20.45%
Revenue growth 3Y17.03%
Revenue growth 5Y12.57%
Sales Q2Q%24.21%
3.2 Future
Based on estimates for the next years, VRT will show a quite strong growth in Earnings Per Share. The EPS will grow by 19.13% on average per year.
The Revenue is expected to grow by 13.30% on average over the next years. This is quite good.
EPS Next Y26.32%
EPS Next 2Y23.95%
EPS Next 3Y24.01%
EPS Next 5Y19.13%
Revenue Next Year20.92%
Revenue Next 2Y17.02%
Revenue Next 3Y15.56%
Revenue Next 5Y13.3%
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.
The Revenue growth rate is stable: in the next years the growth will be about the same than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 41.78, the valuation of VRT can be described as expensive.
Based on the Price/Earnings ratio, VRT is valued a bit cheaper than the industry average as 71.28% of the companies are valued more expensively.
Compared to an average S&P500 Price/Earnings ratio of 27.45, VRT is valued quite expensively.
Based on the Price/Forward Earnings ratio of 29.20, the valuation of VRT can be described as expensive.
Based on the Price/Forward Earnings ratio, VRT is valued a bit cheaper than 70.21% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of VRT to the average of the S&P500 Index (21.90), we can say VRT is valued slightly more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 41.78 | ||
| Fwd PE | 29.2 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, VRT is valued a bit cheaper than 71.28% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, VRT is valued a bit cheaper than 73.40% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 37.52 | ||
| EV/EBITDA | 28.67 |
4.3 Compensation for Growth
VRT's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
The excellent profitability rating of VRT may justify a higher PE ratio.
VRT's earnings are expected to grow with 24.01% in the coming years. This may justify a more expensive valuation.
PEG (NY)1.59
PEG (5Y)N/A
EPS Next 2Y23.95%
EPS Next 3Y24.01%
5. Dividend
5.1 Amount
VRT has a yearly dividend return of 0.12%, which is pretty low.
Compared to an average industry Dividend Yield of 4.40, VRT pays a bit more dividend than its industry peers.
With a Dividend Yield of 0.12, VRT pays less dividend than the S&P500 average, which is at 2.42.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.12% |
5.2 History
VRT has been paying a dividend for over 5 years, so it has already some track record.
VRT has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)N/A
Div Incr Years2
Div Non Decr Years4
5.3 Sustainability
VRT pays out 7.07% of its income as dividend. This is a sustainable payout ratio.
DP7.07%
EPS Next 2Y23.95%
EPS Next 3Y24.01%
127.84
+3.51 (+2.82%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryElectrical Equipment
Earnings (Last)
Earnings (Next)
Inst Owners80.32%
Inst Owner Change-5.58%
Ins Owners0.33%
Ins Owner Change-0.29%
Market Cap48.72B
Analysts81.38
Price Target119.61 (-6.44%)
Short Float %3.24%
Short Ratio1.61
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.12% |
Yearly Dividend0.11
Dividend Growth(5Y)N/A
DP7.07%
Div Incr Years2
Div Non Decr Years4
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)11.26%
Min EPS beat(2)3.02%
Max EPS beat(2)19.49%
EPS beat(4)4
Avg EPS beat(4)11.89%
Min EPS beat(4)3.02%
Max EPS beat(4)19.49%
EPS beat(8)8
Avg EPS beat(8)18.03%
EPS beat(12)11
Avg EPS beat(12)15.46%
EPS beat(16)14
Avg EPS beat(16)11.64%
Revenue beat(2)2
Avg Revenue beat(2)5.91%
Min Revenue beat(2)3.93%
Max Revenue beat(2)7.88%
Revenue beat(4)3
Avg Revenue beat(4)3.84%
Min Revenue beat(4)-0.32%
Max Revenue beat(4)7.88%
Revenue beat(8)5
Avg Revenue beat(8)2.27%
Revenue beat(12)7
Avg Revenue beat(12)2.2%
Revenue beat(16)9
Avg Revenue beat(16)1.63%
PT rev (1m)2.48%
PT rev (3m)-14.3%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-7.47%
EPS NY rev (1m)0.16%
EPS NY rev (3m)-0.64%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)3.22%
Revenue NY rev (1m)0.02%
Revenue NY rev (3m)2.8%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 41.78 | ||
| Fwd PE | 29.2 | ||
| P/S | 5.79 | ||
| P/FCF | 37.52 | ||
| P/OCF | 32.81 | ||
| P/B | 18.27 | ||
| P/tB | N/A | ||
| EV/EBITDA | 28.67 |
EPS(TTM)3.06
EY2.39%
EPS(NY)4.38
Fwd EY3.43%
FCF(TTM)3.41
FCFY2.67%
OCF(TTM)3.9
OCFY3.05%
SpS22.06
BVpS7
TBVpS-0.36
PEG (NY)1.59
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.05% | ||
| ROE | 24.98% | ||
| ROCE | 23.46% | ||
| ROIC | 17.71% | ||
| ROICexc | 23.13% | ||
| ROICexgc | 55.58% | ||
| OM | 17.49% | ||
| PM (TTM) | 7.92% | ||
| GM | 36.32% | ||
| FCFM | 15.44% |
ROA(3y)4.09%
ROA(5y)1.51%
ROE(3y)16.17%
ROE(5y)-1.39%
ROIC(3y)10.93%
ROIC(5y)8.89%
ROICexc(3y)13.11%
ROICexc(5y)10.56%
ROICexgc(3y)32.65%
ROICexgc(5y)28.78%
ROCE(3y)14.48%
ROCE(5y)11.77%
ROICexcg growth 3Y43.97%
ROICexcg growth 5YN/A
ROICexc growth 3Y69.81%
ROICexc growth 5YN/A
OM growth 3Y46.77%
OM growth 5Y27.72%
PM growth 3Y37.26%
PM growth 5YN/A
GM growth 3Y6.33%
GM growth 5Y2.24%
F-Score7
Asset Turnover0.89
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.09 | ||
| Debt/FCF | 2.25 | ||
| Debt/EBITDA | 1.66 | ||
| Cap/Depr | 66.6% | ||
| Cap/Sales | 2.22% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 84.85% | ||
| Profit Quality | 194.94% | ||
| Current Ratio | 1.72 | ||
| Quick Ratio | 1.28 | ||
| Altman-Z | 5.99 |
F-Score7
WACC8.71%
ROIC/WACC2.03
Cap/Depr(3y)50.95%
Cap/Depr(5y)43.21%
Cap/Sales(3y)2.07%
Cap/Sales(5y)1.82%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)55.33%
EPS 3Y55.36%
EPS 5YN/A
EPS Q2Q%48.84%
EPS Next Y26.32%
EPS Next 2Y23.95%
EPS Next 3Y24.01%
EPS Next 5Y19.13%
Revenue 1Y (TTM)20.45%
Revenue growth 3Y17.03%
Revenue growth 5Y12.57%
Sales Q2Q%24.21%
Revenue Next Year20.92%
Revenue Next 2Y17.02%
Revenue Next 3Y15.56%
Revenue Next 5Y13.3%
EBIT growth 1Y50.58%
EBIT growth 3Y71.77%
EBIT growth 5Y43.78%
EBIT Next Year40.15%
EBIT Next 3Y24.77%
EBIT Next 5Y20.2%
FCF growth 1Y1383.3%
FCF growth 3Y107.92%
FCF growth 5YN/A
OCF growth 1Y6839.72%
OCF growth 3Y84.26%
OCF growth 5Y87.13%