VALVOLINE INC (VVV) Stock Fundamental Analysis
NYSE:VVV - New York Stock Exchange, Inc. - US92047W1018 - Common Stock - Currency: USD
VVV gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 122 industry peers in the Specialty Retail industry. VVV has an excellent profitability rating, but there are concerns on its financial health. VVV is quite expensive at the moment. It does show a decent growth rate.
1. Profitability
1.1 Basic Checks
VVV had positive earnings in the past year.
In the past year VVV had a positive cash flow from operations.
VVV had positive earnings in each of the past 5 years.
VVV had a positive operating cash flow in 4 of the past 5 years.
1.2 Ratios
VVV's Return On Assets of 10.90% is amongst the best of the industry. VVV outperforms 85.25% of its industry peers.
The Return On Equity of VVV (107.52%) is better than 99.18% of its industry peers.
With a decent Return On Invested Capital value of 11.74%, VVV is doing good in the industry, outperforming 79.51% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for VVV is below the industry average of 12.95%.
The last Return On Invested Capital (11.74%) for VVV is above the 3 year average (9.44%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 10.9% | ||
| ROE | 107.52% | ||
| ROIC | 11.74% |
ROA(3y)23.41%
ROA(5y)18.75%
ROE(3y)317.01%
ROE(5y)N/A
ROIC(3y)9.44%
ROIC(5y)7.69%
1.3 Margins
The Profit Margin of VVV (15.97%) is better than 96.72% of its industry peers.
In the last couple of years the Profit Margin of VVV has grown nicely.
With an excellent Operating Margin value of 18.74%, VVV belongs to the best of the industry, outperforming 95.90% of the companies in the same industry.
In the last couple of years the Operating Margin of VVV has grown nicely.
With a Gross Margin value of 38.29%, VVV perfoms like the industry average, outperforming 56.56% of the companies in the same industry.
In the last couple of years the Gross Margin of VVV has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 18.74% | ||
| PM (TTM) | 15.97% | ||
| GM | 38.29% |
OM growth 3Y-1.2%
OM growth 5Y3.93%
PM growth 3Y-31.43%
PM growth 5Y8.46%
GM growth 3Y-2.85%
GM growth 5Y2.43%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), VVV is creating some value.
VVV has less shares outstanding than it did 1 year ago.
Compared to 5 years ago, VVV has less shares outstanding
Compared to 1 year ago, VVV has an improved debt to assets ratio.
2.2 Solvency
An Altman-Z score of 2.47 indicates that VVV is not a great score, but indicates only limited risk for bankruptcy at the moment.
VVV has a Altman-Z score of 2.47. This is comparable to the rest of the industry: VVV outperforms 56.56% of its industry peers.
VVV has a debt to FCF ratio of 47.39. This is a negative value and a sign of low solvency as VVV would need 47.39 years to pay back of all of its debts.
VVV has a Debt to FCF ratio of 47.39. This is comparable to the rest of the industry: VVV outperforms 46.72% of its industry peers.
VVV has a Debt/Equity ratio of 4.23. This is a high value indicating a heavy dependency on external financing.
The Debt to Equity ratio of VVV (4.23) is worse than 78.69% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 4.23 | ||
| Debt/FCF | 47.39 | ||
| Altman-Z | 2.47 |
ROIC/WACC1.32
WACC8.9%
2.3 Liquidity
VVV has a Current Ratio of 0.73. This is a bad value and indicates that VVV is not financially healthy enough and could expect problems in meeting its short term obligations.
VVV's Current ratio of 0.73 is on the low side compared to the rest of the industry. VVV is outperformed by 87.70% of its industry peers.
VVV has a Quick Ratio of 0.73. This is a bad value and indicates that VVV is not financially healthy enough and could expect problems in meeting its short term obligations.
With a Quick ratio value of 0.60, VVV perfoms like the industry average, outperforming 58.20% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.73 | ||
| Quick Ratio | 0.6 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 6.08% over the past year.
Measured over the past 5 years, VVV shows a small growth in Earnings Per Share. The EPS has been growing by 2.47% on average per year.
VVV shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 9.56%.
VVV shows a decrease in Revenue. Measured over the last years, the Revenue has been decreasing by -7.49% yearly.
EPS 1Y (TTM)6.08%
EPS 3Y-6.49%
EPS 5Y2.47%
EPS Q2Q%-8.11%
Revenue 1Y (TTM)9.56%
Revenue growth 3Y16%
Revenue growth 5Y-7.49%
Sales Q2Q%3.73%
3.2 Future
Based on estimates for the next years, VVV will show a small growth in Earnings Per Share. The EPS will grow by 7.69% on average per year.
The Revenue is expected to grow by 6.78% on average over the next years.
EPS Next Y2.49%
EPS Next 2Y9.77%
EPS Next 3Y7.69%
EPS Next 5YN/A
Revenue Next Year5.76%
Revenue Next 2Y10.47%
Revenue Next 3Y6.78%
Revenue Next 5YN/A
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 23.55, the valuation of VVV can be described as rather expensive.
Compared to the rest of the industry, the Price/Earnings ratio of VVV indicates a somewhat cheap valuation: VVV is cheaper than 61.48% of the companies listed in the same industry.
VVV is valuated at similar levels of the S&P average when we compare the Price/Earnings ratio to 26.69, which is the current average of the S&P500 Index.
With a Price/Forward Earnings ratio of 19.55, VVV is valued on the expensive side.
The rest of the industry has a similar Price/Forward Earnings ratio as VVV.
When comparing the Price/Forward Earnings ratio of VVV to the average of the S&P500 Index (21.29), we can say VVV is valued inline with the index average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 23.55 | ||
| Fwd PE | 19.55 |
4.2 Price Multiples
The rest of the industry has a similar Enterprise Value to EBITDA ratio as VVV.
The rest of the industry has a similar Price/Free Cash Flow ratio as VVV.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 207.07 | ||
| EV/EBITDA | 13.55 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates VVV does not grow enough to justify the current Price/Earnings ratio.
VVV has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)9.44
PEG (5Y)9.55
EPS Next 2Y9.77%
EPS Next 3Y7.69%
5. Dividend
5.1 Amount
VVV has a Yearly Dividend Yield of 1.43%. Purely for dividend investing, there may be better candidates out there.
VVV's Dividend Yield is a higher than the industry average which is at 5.35.
With a Dividend Yield of 1.43, VVV pays less dividend than the S&P500 average, which is at 2.43.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.43% |
5.2 History
VVV has been paying a dividend for over 5 years, so it has already some track record.
Dividend Growth(5Y)N/A
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
DP0%
EPS Next 2Y9.77%
EPS Next 3Y7.69%
36.98
-0.43 (-1.15%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Discretionary Distribution & Retail
GICS IndustrySpecialty Retail
Earnings (Last)
Earnings (Next)
Inst Owners104.35%
Inst Owner Change5.39%
Ins Owners0.26%
Ins Owner Change0.53%
Market Cap4.70B
Analysts76.84
Price Target43.44 (17.47%)
Short Float %7.05%
Short Ratio4.92
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.43% |
Yearly Dividend0
Dividend Growth(5Y)N/A
DP0%
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-0.35%
Min EPS beat(2)-6.75%
Max EPS beat(2)6.05%
EPS beat(4)2
Avg EPS beat(4)0.21%
Min EPS beat(4)-6.75%
Max EPS beat(4)7.74%
EPS beat(8)4
Avg EPS beat(8)2.2%
EPS beat(12)6
Avg EPS beat(12)-1.05%
EPS beat(16)9
Avg EPS beat(16)0.81%
Revenue beat(2)1
Avg Revenue beat(2)0.55%
Min Revenue beat(2)-1.46%
Max Revenue beat(2)2.56%
Revenue beat(4)1
Avg Revenue beat(4)-0.28%
Min Revenue beat(4)-1.88%
Max Revenue beat(4)2.56%
Revenue beat(8)2
Avg Revenue beat(8)-0.55%
Revenue beat(12)2
Avg Revenue beat(12)-10.93%
Revenue beat(16)3
Avg Revenue beat(16)-30.69%
PT rev (1m)-1.16%
PT rev (3m)-3.12%
EPS NQ rev (1m)-0.17%
EPS NQ rev (3m)-5.25%
EPS NY rev (1m)-0.76%
EPS NY rev (3m)-2.1%
Revenue NQ rev (1m)0.02%
Revenue NQ rev (3m)-2.82%
Revenue NY rev (1m)-0.06%
Revenue NY rev (3m)-1.37%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 23.55 | ||
| Fwd PE | 19.55 | ||
| P/S | 2.81 | ||
| P/FCF | 207.07 | ||
| P/OCF | 17.72 | ||
| P/B | 18.9 | ||
| P/tB | N/A | ||
| EV/EBITDA | 13.55 |
EPS(TTM)1.57
EY4.25%
EPS(NY)1.89
Fwd EY5.12%
FCF(TTM)0.18
FCFY0.48%
OCF(TTM)2.09
OCFY5.64%
SpS13.17
BVpS1.96
TBVpS-3.48
PEG (NY)9.44
PEG (5Y)9.55
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 10.9% | ||
| ROE | 107.52% | ||
| ROCE | 14.68% | ||
| ROIC | 11.74% | ||
| ROICexc | 12.09% | ||
| ROICexgc | 18.13% | ||
| OM | 18.74% | ||
| PM (TTM) | 15.97% | ||
| GM | 38.29% | ||
| FCFM | 1.36% |
ROA(3y)23.41%
ROA(5y)18.75%
ROE(3y)317.01%
ROE(5y)N/A
ROIC(3y)9.44%
ROIC(5y)7.69%
ROICexc(3y)10.86%
ROICexc(5y)8.92%
ROICexgc(3y)16.64%
ROICexgc(5y)13.28%
ROCE(3y)11.8%
ROCE(5y)9.62%
ROICexcg growth 3Y28.72%
ROICexcg growth 5Y-9.33%
ROICexc growth 3Y23.11%
ROICexc growth 5Y-9.61%
OM growth 3Y-1.2%
OM growth 5Y3.93%
PM growth 3Y-31.43%
PM growth 5Y8.46%
GM growth 3Y-2.85%
GM growth 5Y2.43%
F-Score7
Asset Turnover0.68
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 4.23 | ||
| Debt/FCF | 47.39 | ||
| Debt/EBITDA | 2.47 | ||
| Cap/Depr | 216.41% | ||
| Cap/Sales | 14.49% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 62.29% | ||
| Profit Quality | 8.49% | ||
| Current Ratio | 0.73 | ||
| Quick Ratio | 0.6 | ||
| Altman-Z | 2.47 |
F-Score7
WACC8.9%
ROIC/WACC1.32
Cap/Depr(3y)200.01%
Cap/Depr(5y)197.07%
Cap/Sales(3y)12.35%
Cap/Sales(5y)14.34%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)6.08%
EPS 3Y-6.49%
EPS 5Y2.47%
EPS Q2Q%-8.11%
EPS Next Y2.49%
EPS Next 2Y9.77%
EPS Next 3Y7.69%
EPS Next 5YN/A
Revenue 1Y (TTM)9.56%
Revenue growth 3Y16%
Revenue growth 5Y-7.49%
Sales Q2Q%3.73%
Revenue Next Year5.76%
Revenue Next 2Y10.47%
Revenue Next 3Y6.78%
Revenue Next 5YN/A
EBIT growth 1Y5.55%
EBIT growth 3Y14.61%
EBIT growth 5Y-3.86%
EBIT Next Year38.61%
EBIT Next 3Y17.36%
EBIT Next 5YN/A
FCF growth 1Y-85.25%
FCF growth 3Y-46.11%
FCF growth 5Y-28.45%
OCF growth 1Y-11.06%
OCF growth 3Y-13.1%
OCF growth 5Y-3.99%