DNOW Inc.
Find Ratings ReportsDNOW INC's gross profit margin for the fourth quarter of its fiscal year 2023 is essentially unchanged when compared to the same period a year ago. The company managed to grow both sales and net income at a faster pace than the average competitor in its subsector this quarter as compared to the same quarter a year ago. DNOW INC has strong liquidity. Currently, the Quick Ratio is 1.63 which shows the ability to cover short-term cash needs. The company's liquidity has increased from the same period last year, indicating improving cash flow.
At the same time, stockholders' equity ("net worth") has greatly increased by 25.89% from the same quarter last year. The key liquidity measurements indicate that the company is unlikely to face financial difficulties in the near future.
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Income Statement | Q4 FY23 | Q4 FY22 |
---|---|---|
Net Sales ($mil) | 555.0 | 547.0 |
EBITDA ($mil) | 41.0 | 43.0 |
EBIT ($mil) | 34.0 | 38.0 |
Net Income ($mil) | 147.0 | 32.0 |
Balance Sheet | Q4 FY23 | Q4 FY22 |
---|---|---|
Cash & Equiv. ($mil) | 299.0 | 212.0 |
Total Assets ($mil) | 1529.0 | 1320.0 |
Total Debt ($mil) | 63.0 | 49.0 |
Equity ($mil) | 1060.0 | 842.0 |
Profitability | Q4 FY23 | Q4 FY22 |
---|---|---|
Gross Profit Margin | 24.68 | 25.05 |
EBITDA Margin | 7.38 | 7.86 |
Operating Margin | 6.13 | 6.95 |
Sales Turnover | 1.52 | 1.62 |
Return on Assets | 16.15 | 9.69 |
Return on Equity | 23.3 | 15.2 |
Debt | Q4 FY23 | Q4 FY22 |
---|---|---|
Current Ratio | 2.56 | 2.32 |
Debt/Capital | 0.06 | 0.06 |
Interest Expense | 0.0 | 0.0 |
Interest Coverage | 0.0 | 0.0 |
Share Data | Q4 FY23 | Q4 FY22 |
---|---|---|
Shares outstanding (mil) | 106.26 | 110.37 |
Div / share | 0.0 | 0.0 |
EPS | 1.35 | 0.28 |
Book value / share | 9.98 | 7.63 |
Institutional Own % | n/a | n/a |
Avg Daily Volume | 1063997.0 | 743028.0 |
BUY. DNOW INC's P/E ratio indicates a significant discount compared to an average of 24.06 for the Merchant Wholesalers, Durable Goods subsector and a significant discount compared to the S&P 500 average of 27.95. For additional comparison, its price-to-book ratio of 1.45 indicates a significant discount versus the S&P 500 average of 4.68 and a significant discount versus the subsector average of 6.83. The price-to-sales ratio is well below both the S&P 500 average and the subsector average, indicating a discount. Upon assessment of these and other key valuation criteria, DNOW INC proves to trade at a discount to investment alternatives.
Price/Earnings |
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Price/Cash Flow |
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DNOW 6.40 | Peers 24.06 | DNOW 8.17 | Peers 17.73 | |||||||||||||||||||||
Discount. A lower P/E ratio than its peers can signify a less expensive stock or lower growth expectations. DNOW is trading at a significant discount to its peers. |
Discount. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures. DNOW is trading at a significant discount to its peers. |
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Price/Projected Earnings |
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Price to Earnings/Growth |
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DNOW 13.64 | Peers 24.12 | DNOW NM | Peers 3.31 | |||||||||||||||||||||
Discount. A lower price-to-projected earnings ratio than its peers can signify a less expensive stock or lower future growth expectations. DNOW is trading at a significant discount to its peers. |
Neutral. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples. DNOW's negative PEG ratio makes this valuation measure meaningless. |
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Price/Book |
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Earnings Growth |
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DNOW 1.45 | Peers 6.83 | DNOW 100.00 | Peers -19.81 | |||||||||||||||||||||
Discount. A lower price-to-book ratio makes a stock more attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet. DNOW is trading at a significant discount to its peers. |
Higher. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios. DNOW is expected to have an earnings growth rate that significantly exceeds its peers. |
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Price/Sales |
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Sales Growth |
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DNOW 0.66 | Peers 1.87 | DNOW 8.66 | Peers -0.87 | |||||||||||||||||||||
Discount. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales. DNOW is trading at a significant discount to its subsector on this measurement. |
Higher. A sales growth rate that exceeds the subsector implies that a company is gaining market share. DNOW has a sales growth rate that significantly exceeds its peers. |
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