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 121 industry peers in the Specialty Retail industry. While VVV has a great profitability rating, there are quite some concerns on its financial health. VVV has a correct valuation and a medium 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 has a better Return On Assets (11.54%) than 86.78% of its industry peers.
VVV has a Return On Equity of 118.02%. This is amongst the best in the industry. VVV outperforms 98.35% of its industry peers.
VVV has a better Return On Invested Capital (12.64%) than 80.99% of its industry peers.
The Average Return On Invested Capital over the past 3 years for VVV is below the industry average of 13.08%.
The 3 year average ROIC (9.44%) for VVV is below the current ROIC(12.64%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 11.54% | ||
| ROE | 118.02% | ||
| ROIC | 12.64% |
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
With an excellent Profit Margin value of 16.34%, VVV belongs to the best of the industry, outperforming 98.35% of the companies in the same industry.
In the last couple of years the Profit Margin of VVV has grown nicely.
VVV has a Operating Margin of 19.49%. This is amongst the best in the industry. VVV outperforms 96.69% of its industry peers.
In the last couple of years the Operating Margin of VVV has grown nicely.
With a Gross Margin value of 38.37%, VVV perfoms like the industry average, outperforming 55.37% of the companies in the same industry.
VVV's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 19.49% | ||
| PM (TTM) | 16.34% | ||
| GM | 38.37% |
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.
The number of shares outstanding for VVV has been reduced compared to 1 year ago.
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 2.43 indicates that VVV is not a great score, but indicates only limited risk for bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 2.43, VVV is in line with its industry, outperforming 54.55% of the companies in the same industry.
VVV has a debt to FCF ratio of 20.38. This is a negative value and a sign of low solvency as VVV would need 20.38 years to pay back of all of its debts.
Looking at the Debt to FCF ratio, with a value of 20.38, VVV is in line with its industry, outperforming 44.63% of the companies in the same industry.
VVV has a Debt/Equity ratio of 4.39. This is a high value indicating a heavy dependency on external financing.
VVV has a Debt to Equity ratio of 4.39. This is in the lower half of the industry: VVV underperforms 77.69% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 4.39 | ||
| Debt/FCF | 20.38 | ||
| Altman-Z | 2.43 |
ROIC/WACC1.42
WACC8.9%
2.3 Liquidity
A Current Ratio of 0.70 indicates that VVV may have some problems paying its short term obligations.
VVV's Current ratio of 0.70 is on the low side compared to the rest of the industry. VVV is outperformed by 90.08% of its industry peers.
A Quick Ratio of 0.58 indicates that VVV may have some problems paying its short term obligations.
VVV has a Quick ratio of 0.58. This is comparable to the rest of the industry: VVV outperforms 52.89% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.7 | ||
| Quick Ratio | 0.58 |
3. Growth
3.1 Past
VVV shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 19.40%, which is quite good.
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.
Looking at the last year, VVV shows a quite strong growth in Revenue. The Revenue has grown by 11.85% in the last year.
VVV shows a decrease in Revenue. Measured over the last years, the Revenue has been decreasing by -7.49% yearly.
EPS 1Y (TTM)19.4%
EPS 3Y-6.49%
EPS 5Y2.47%
EPS Q2Q%10.34%
Revenue 1Y (TTM)11.85%
Revenue growth 3Y16%
Revenue growth 5Y-7.49%
Sales Q2Q%10.95%
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 8.51% on average per year.
Based on estimates for the next years, VVV will show a small growth in Revenue. The Revenue will grow by 6.72% on average per year.
EPS Next Y4.89%
EPS Next 2Y11.58%
EPS Next 3Y8.51%
EPS Next 5YN/A
Revenue Next Year8.21%
Revenue Next 2Y11.28%
Revenue Next 3Y6.72%
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.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 21.24, which indicates a rather expensive current valuation of VVV.
Compared to the rest of the industry, the Price/Earnings ratio of VVV indicates a somewhat cheap valuation: VVV is cheaper than 61.98% of the companies listed in the same industry.
VVV's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 28.22.
Based on the Price/Forward Earnings ratio of 17.39, the valuation of VVV can be described as rather expensive.
Compared to the rest of the industry, the Price/Forward Earnings ratio of VVV indicates a somewhat cheap valuation: VVV is cheaper than 63.64% of the companies listed in the same industry.
When comparing the Price/Forward Earnings ratio of VVV to the average of the S&P500 Index (20.86), we can say VVV is valued inline with the index average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 21.24 | ||
| Fwd PE | 17.39 |
4.2 Price Multiples
VVV's Enterprise Value to EBITDA is on the same level as the industry average.
The rest of the industry has a similar Price/Free Cash Flow ratio as VVV.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 85.21 | ||
| EV/EBITDA | 12.16 |
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)4.35
PEG (5Y)8.62
EPS Next 2Y11.58%
EPS Next 3Y8.51%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 1.43%, VVV has a reasonable but not impressive dividend return.
VVV's Dividend Yield is a higher than the industry average which is at 5.48.
With a Dividend Yield of 1.43, VVV pays less dividend than the S&P500 average, which is at 2.44.
| 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 2Y11.58%
EPS Next 3Y8.51%
33.99
+0.23 (+0.68%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Discretionary Distribution & Retail
GICS IndustrySpecialty Retail
Earnings (Last)
Earnings (Next)
Inst Owners101.71%
Inst Owner Change-0.03%
Ins Owners0.26%
Ins Owner Change6.15%
Market Cap4.32B
Analysts75.79
Price Target44.5 (30.92%)
Short Float %5.34%
Short Ratio4.28
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)2
Avg EPS beat(2)6.89%
Min EPS beat(2)6.05%
Max EPS beat(2)7.74%
EPS beat(4)3
Avg EPS beat(4)3.1%
Min EPS beat(4)-6.2%
Max EPS beat(4)7.74%
EPS beat(8)4
Avg EPS beat(8)0.86%
EPS beat(12)6
Avg EPS beat(12)-0.93%
EPS beat(16)10
Avg EPS beat(16)2.7%
Revenue beat(2)1
Avg Revenue beat(2)1.1%
Min Revenue beat(2)-0.36%
Max Revenue beat(2)2.56%
Revenue beat(4)1
Avg Revenue beat(4)-0.27%
Min Revenue beat(4)-1.88%
Max Revenue beat(4)2.56%
Revenue beat(8)2
Avg Revenue beat(8)-0.48%
Revenue beat(12)2
Avg Revenue beat(12)-16.39%
Revenue beat(16)4
Avg Revenue beat(16)-30.26%
PT rev (1m)-0.75%
PT rev (3m)0.02%
EPS NQ rev (1m)-2.45%
EPS NQ rev (3m)-1.83%
EPS NY rev (1m)-0.03%
EPS NY rev (3m)0.78%
Revenue NQ rev (1m)-0.05%
Revenue NQ rev (3m)-0.42%
Revenue NY rev (1m)0.91%
Revenue NY rev (3m)2.38%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 21.24 | ||
| Fwd PE | 17.39 | ||
| P/S | 2.6 | ||
| P/FCF | 85.21 | ||
| P/OCF | 15.08 | ||
| P/B | 18.8 | ||
| P/tB | N/A | ||
| EV/EBITDA | 12.16 |
EPS(TTM)1.6
EY4.71%
EPS(NY)1.95
Fwd EY5.75%
FCF(TTM)0.4
FCFY1.17%
OCF(TTM)2.25
OCFY6.63%
SpS13.06
BVpS1.81
TBVpS-3.62
PEG (NY)4.35
PEG (5Y)8.62
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 11.54% | ||
| ROE | 118.02% | ||
| ROCE | 15.81% | ||
| ROIC | 12.64% | ||
| ROICexc | 13.03% | ||
| ROICexgc | 19.95% | ||
| OM | 19.49% | ||
| PM (TTM) | 16.34% | ||
| GM | 38.37% | ||
| FCFM | 3.05% |
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 Turnover0.71
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 4.39 | ||
| Debt/FCF | 20.38 | ||
| Debt/EBITDA | 2.33 | ||
| Cap/Depr | 215.65% | ||
| Cap/Sales | 14.2% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 66.17% | ||
| Profit Quality | 18.69% | ||
| Current Ratio | 0.7 | ||
| Quick Ratio | 0.58 | ||
| Altman-Z | 2.43 |
F-Score7
WACC8.9%
ROIC/WACC1.42
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)19.4%
EPS 3Y-6.49%
EPS 5Y2.47%
EPS Q2Q%10.34%
EPS Next Y4.89%
EPS Next 2Y11.58%
EPS Next 3Y8.51%
EPS Next 5YN/A
Revenue 1Y (TTM)11.85%
Revenue growth 3Y16%
Revenue growth 5Y-7.49%
Sales Q2Q%10.95%
Revenue Next Year8.21%
Revenue Next 2Y11.28%
Revenue Next 3Y6.72%
Revenue Next 5YN/A
EBIT growth 1Y12.52%
EBIT growth 3Y14.61%
EBIT growth 5Y-3.86%
EBIT Next Year41.93%
EBIT Next 3Y17.86%
EBIT Next 5YN/A
FCF growth 1Y-52.44%
FCF growth 3Y-46.11%
FCF growth 5Y-28.45%
OCF growth 1Y17.62%
OCF growth 3Y-13.1%
OCF growth 5Y-3.99%