20.19 USD
+0.36 (+1.82%)
20.19 USD
0 (0%)
XP gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 237 industry peers in the Capital Markets industry. There are concerns on the financial health of XP while its profitability can be described as average. XP has both an excellent growth and valuation score. This means it is growing and it is still cheap. This is a rare combination!
1. Profitability
1.1 Basic Checks
- In the past year XP was profitable.
- XP had a positive operating cash flow in the past year.
- In the past 5 years XP has always been profitable.
- XP had a positive operating cash flow in 4 of the past 5 years.
1.2 Ratios
- The Return On Assets of XP (1.27%) is worse than 65.97% of its industry peers.
- With an excellent Return On Equity value of 21.36%, XP belongs to the best of the industry, outperforming 89.08% of the companies in the same industry.
- The Return On Invested Capital of XP (1.17%) is worse than 64.71% of its industry peers.
- XP had an Average Return On Invested Capital over the past 3 years of 1.49%. This is significantly below the industry average of 7.27%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.27% | ||
| ROE | 21.36% | ||
| ROIC | 1.17% |
ROA(3y)1.58%
ROA(5y)1.89%
ROE(3y)21.19%
ROE(5y)21.51%
ROIC(3y)1.49%
ROIC(5y)1.78%
1.3 Margins
- XP has a better Profit Margin (28.24%) than 71.85% of its industry peers.
- XP's Profit Margin has improved in the last couple of years.
- Looking at the Operating Margin, with a value of 32.63%, XP is in the better half of the industry, outperforming 63.03% of the companies in the same industry.
- In the last couple of years the Operating Margin of XP has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 32.63% | ||
| PM (TTM) | 28.24% | ||
| GM | N/A |
OM growth 3Y0.94%
OM growth 5Y1.22%
PM growth 3Y-3.75%
PM growth 5Y4.69%
GM growth 3YN/A
GM growth 5YN/A
2. Health
2.1 Basic Checks
- Compared to 1 year ago, XP has less shares outstanding
- Compared to 5 years ago, XP has less shares outstanding
- The debt/assets ratio for XP is higher compared to a year ago.
2.2 Solvency
- Based on the Altman-Z score of 0.02, we must say that XP is in the distress zone and has some risk of bankruptcy.
- With a Altman-Z score value of 0.02, XP is not doing good in the industry: 74.37% of the companies in the same industry are doing better.
- The Debt to FCF ratio of XP is 5.70, which is a neutral value as it means it would take XP, 5.70 years of fcf income to pay off all of its debts.
- XP has a better Debt to FCF ratio (5.70) than 68.07% of its industry peers.
- A Debt/Equity ratio of 4.12 is on the high side and indicates that XP has dependencies on debt financing.
- XP has a worse Debt to Equity ratio (4.12) than 82.77% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 4.12 | ||
| Debt/FCF | 5.7 | ||
| Altman-Z | 0.02 |
ROIC/WACCN/A
WACCN/A
2.3 Liquidity
- XP has a Current Ratio of 0.18. This is a bad value and indicates that XP is not financially healthy enough and could expect problems in meeting its short term obligations.
- XP's Current ratio of 0.18 is on the low side compared to the rest of the industry. XP is outperformed by 89.08% of its industry peers.
- A Quick Ratio of 0.18 indicates that XP may have some problems paying its short term obligations.
- XP has a worse Quick ratio (0.18) than 89.08% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.18 | ||
| Quick Ratio | 0.18 |
3. Growth
3.1 Past
- XP shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 11.06%, which is quite good.
- The Earnings Per Share has been growing by 33.24% on average over the past years. This is a very strong growth
- Looking at the last year, XP shows a small growth in Revenue. The Revenue has grown by 7.60% in the last year.
- XP shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 27.13% yearly.
EPS 1Y (TTM)11.06%
EPS 3Y7.19%
EPS 5Y33.24%
EPS Q2Q%12.33%
Revenue 1Y (TTM)7.6%
Revenue growth 3Y12.14%
Revenue growth 5Y27.13%
Sales Q2Q%7.92%
3.2 Future
- The Earnings Per Share is expected to grow by 13.62% on average over the next years. This is quite good.
- Based on estimates for the next years, XP will show a quite strong growth in Revenue. The Revenue will grow by 10.67% on average per year.
EPS Next Y17.07%
EPS Next 2Y13.44%
EPS Next 3Y13.62%
EPS Next 5YN/A
Revenue Next Year7.38%
Revenue Next 2Y9.98%
Revenue Next 3Y11.29%
Revenue Next 5Y10.67%
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.
- Although the future Revenue growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.
4. Valuation
4.1 Price/Earnings Ratio
- With a Price/Earnings ratio of 11.28, the valuation of XP can be described as very reasonable.
- XP's Price/Earnings ratio is a bit cheaper when compared to the industry. XP is cheaper than 61.76% of the companies in the same industry.
- Compared to an average S&P500 Price/Earnings ratio of 27.21, XP is valued rather cheaply.
- Based on the Price/Forward Earnings ratio of 9.61, the valuation of XP can be described as reasonable.
- Based on the Price/Forward Earnings ratio, XP is valued a bit cheaper than 77.31% of the companies in the same industry.
- XP is valuated cheaply when we compare the Price/Forward Earnings ratio to 25.98, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 11.28 | ||
| Fwd PE | 9.61 |
4.2 Price Multiples
- Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of XP indicates a rather cheap valuation: XP is cheaper than 90.34% of the companies listed in the same industry.
- Compared to the rest of the industry, the Price/Free Cash Flow ratio of XP indicates a rather cheap valuation: XP is cheaper than 89.50% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 3.11 | ||
| EV/EBITDA | 8.14 |
4.3 Compensation for Growth
- The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
- A more expensive valuation may be justified as XP's earnings are expected to grow with 13.62% in the coming years.
PEG (NY)0.66
PEG (5Y)0.34
EPS Next 2Y13.44%
EPS Next 3Y13.62%
5. Dividend
5.1 Amount
- XP has a Yearly Dividend Yield of 1.10%. Purely for dividend investing, there may be better candidates out there.
- XP's Dividend Yield is slightly below the industry average, which is at 5.87.
- XP's Dividend Yield is slightly below the S&P500 average, which is at 1.81.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.1% |
5.2 History
- XP has been paying a dividend for less than 5 years, so it still needs to build a track record.
Dividend Growth(5Y)N/A
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
- XP pays out 40.30% of its income as dividend. This is a bit on the high side, but may be sustainable.
DP40.3%
EPS Next 2Y13.44%
EPS Next 3Y13.62%
XP INC - CLASS A / XP FAQ
What is the ChartMill fundamental rating of XP INC - CLASS A (XP) stock?
ChartMill assigns a fundamental rating of 5 / 10 to XP.
What is the valuation status for XP stock?
ChartMill assigns a valuation rating of 8 / 10 to XP INC - CLASS A (XP). This can be considered as Undervalued.
Can you provide the profitability details for XP INC - CLASS A?
XP INC - CLASS A (XP) has a profitability rating of 4 / 10.
What is the expected EPS growth for XP INC - CLASS A (XP) stock?
The Earnings per Share (EPS) of XP INC - CLASS A (XP) is expected to grow by 17.07% in the next year.
How sustainable is the dividend of XP INC - CLASS A (XP) stock?
The dividend rating of XP INC - CLASS A (XP) is 2 / 10 and the dividend payout ratio is 40.3%.