VALVOLINE INC (VVV) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:VVV - US92047W1018 - Common Stock
32.83 USD
-0.01 (-0.03%)
Taking everything into account, VVV scores 5 out of 10 in our fundamental rating. VVV was compared to 122 industry peers in the Specialty Retail industry. While VVV has a great profitability rating, there are quite some concerns on its financial health. VVV is not valued too expensively and it also shows a decent growth rate.
1. Profitability
1.1 Basic Checks
- In the past year VVV was profitable.
- VVV had a positive operating cash flow in the past year.
- In the past 5 years VVV has always been profitable.
- Of the past 5 years VVV 4 years had a positive operating cash flow.
1.2 Ratios
- With an excellent Return On Assets value of 7.89%, VVV belongs to the best of the industry, outperforming 81.97% of the companies in the same industry.
- The Return On Equity of VVV (62.25%) is better than 96.72% of its industry peers.
- Looking at the Return On Invested Capital, with a value of 10.18%, VVV is in the better half of the industry, outperforming 75.41% of the companies in the same industry.
- The Average Return On Invested Capital over the past 3 years for VVV is in line with the industry average of 12.24%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.89% | ||
| ROE | 62.25% | ||
| ROIC | 10.18% |
ROA(3y)21.9%
ROA(5y)18.26%
ROE(3y)291.62%
ROE(5y)265.15%
ROIC(3y)11.31%
ROIC(5y)9.35%
1.3 Margins
- VVV has a Profit Margin of 12.32%. This is amongst the best in the industry. VVV outperforms 93.44% of its industry peers.
- VVV's Profit Margin has declined in the last couple of years.
- The Operating Margin of VVV (18.55%) is better than 95.90% of its industry peers.
- VVV's Operating Margin has improved in the last couple of years.
- VVV has a Gross Margin (38.50%) which is in line with its industry peers.
- In the last couple of years the Gross Margin of VVV has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 18.55% | ||
| PM (TTM) | 12.32% | ||
| GM | 38.5% |
OM growth 3Y6.87%
OM growth 5Y6.08%
PM growth 3Y-28.93%
PM growth 5Y-22.32%
GM growth 3Y-0.03%
GM growth 5Y-1.44%
2. Health
2.1 Basic Checks
- The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so VVV is still creating some value.
- Compared to 1 year ago, VVV has less shares outstanding
- The number of shares outstanding for VVV has been reduced compared to 5 years ago.
- VVV has a better debt/assets ratio than last year.
2.2 Solvency
- An Altman-Z score of 2.20 indicates that VVV is not a great score, but indicates only limited risk for bankruptcy at the moment.
- VVV has a Altman-Z score (2.20) which is in line with its industry peers.
- VVV has a debt to FCF ratio of 34.30. This is a negative value and a sign of low solvency as VVV would need 34.30 years to pay back of all of its debts.
- With a Debt to FCF ratio value of 34.30, VVV perfoms like the industry average, outperforming 43.44% of the companies in the same industry.
- VVV has a Debt/Equity ratio of 3.78. This is a high value indicating a heavy dependency on external financing.
- With a Debt to Equity ratio value of 3.78, VVV is not doing good in the industry: 76.23% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 3.78 | ||
| Debt/FCF | 34.3 | ||
| Altman-Z | 2.2 |
ROIC/WACC1.12
WACC9.12%
2.3 Liquidity
- A Current Ratio of 0.70 indicates that VVV may have some problems paying its short term obligations.
- VVV has a Current ratio of 0.70. This is amonst the worse of the industry: VVV underperforms 88.52% of its industry peers.
- A Quick Ratio of 0.58 indicates that VVV may have some problems paying its short term obligations.
- VVV's Quick ratio of 0.58 is in line compared to the rest of the industry. VVV outperforms 54.10% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.7 | ||
| Quick Ratio | 0.58 |
3. Growth
3.1 Past
- VVV shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 0.64%.
- The Earnings Per Share has been growing slightly by 1.32% on average over the past years.
- Looking at the last year, VVV shows a small growth in Revenue. The Revenue has grown by 5.64% in the last year.
- VVV shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 18.66% yearly.
EPS 1Y (TTM)0.64%
EPS 3Y-9.48%
EPS 5Y1.32%
EPS Q2Q%-2.17%
Revenue 1Y (TTM)5.64%
Revenue growth 3Y11.43%
Revenue growth 5Y18.66%
Sales Q2Q%4.2%
3.2 Future
- Based on estimates for the next years, VVV will show a quite strong growth in Earnings Per Share. The EPS will grow by 16.21% on average per year.
- The Revenue is expected to grow by 13.45% on average over the next years. This is quite good.
EPS Next Y6.59%
EPS Next 2Y12.57%
EPS Next 3Y16.21%
EPS Next 5YN/A
Revenue Next Year19.56%
Revenue Next 2Y14.84%
Revenue Next 3Y13.45%
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.
- The estimated forward Revenue growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
4. Valuation
4.1 Price/Earnings Ratio
- With a Price/Earnings ratio of 20.78, VVV is valued on the expensive side.
- Based on the Price/Earnings ratio, VVV is valued a bit cheaper than 73.77% of the companies in the same industry.
- VVV is valuated rather cheaply when we compare the Price/Earnings ratio to 28.60, which is the current average of the S&P500 Index.
- The Price/Forward Earnings ratio is 19.49, which indicates a rather expensive current valuation of VVV.
- Compared to the rest of the industry, the Price/Forward Earnings ratio of VVV indicates a somewhat cheap valuation: VVV is cheaper than 64.75% of the companies listed in the same industry.
- The average S&P500 Price/Forward Earnings ratio is at 25.83. VVV is valued slightly cheaper when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 20.78 | ||
| Fwd PE | 19.49 |
4.2 Price Multiples
- Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of VVV is on the same level as its industry peers.
- The rest of the industry has a similar Price/Free Cash Flow ratio as VVV.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 109.86 | ||
| EV/EBITDA | 12.43 |
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 a very decent profitability rating, which may justify a higher PE ratio.
- A more expensive valuation may be justified as VVV's earnings are expected to grow with 16.21% in the coming years.
PEG (NY)3.15
PEG (5Y)15.79
EPS Next 2Y12.57%
EPS Next 3Y16.21%
5. Dividend
5.1 Amount
- VVV has a Yearly Dividend Yield of 1.43%.
- Compared to an average industry Dividend Yield of 2.15, VVV pays a bit more dividend than its industry peers.
- VVV's Dividend Yield is slightly below the S&P500 average, which is at 1.82.
| 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 2Y12.57%
EPS Next 3Y16.21%
VALVOLINE INC / VVV FAQ
Can you provide the ChartMill fundamental rating for VALVOLINE INC?
ChartMill assigns a fundamental rating of 5 / 10 to VVV.
What is the valuation status of VALVOLINE INC (VVV) stock?
ChartMill assigns a valuation rating of 4 / 10 to VALVOLINE INC (VVV). This can be considered as Fairly Valued.
Can you provide the profitability details for VALVOLINE INC?
VALVOLINE INC (VVV) has a profitability rating of 7 / 10.
What is the expected EPS growth for VALVOLINE INC (VVV) stock?
The Earnings per Share (EPS) of VALVOLINE INC (VVV) is expected to grow by 6.59% in the next year.
Can you provide the dividend sustainability for VVV stock?
The dividend rating of VALVOLINE INC (VVV) is 3 / 10 and the dividend payout ratio is 0%.