Avon Products Inc

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AVP : NYSE : Consumer Goods
$2.445 -0.035 | -1.4%
Today's Range: 2.425 - 2.53
Avg. Daily Volume: 5869300.0
09/19/17 - 12:41 PM ET

Financial Analysis


AVON PRODUCTS's gross profit margin for the second quarter of its fiscal year 2017 is essentially unchanged when compared to the same period a year ago. Sales and net income have dropped, underperforming the average competitor within its industry. AVON PRODUCTS has weak liquidity. Currently, the Quick Ratio is 0.73 which shows a lack of ability to cover short-term cash needs. The company's liquidity has decreased from the same period last year.

At the same time, stockholders' equity ("net worth") has remained virtually unchanged only increasing by 3.50% from the same quarter last year. Overall, the key liquidity measurements indicate that the company is in a position in which financial difficulties could develop in the future.

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Income Statement Q2 FY17 Q2 FY16
Net Sales ($mil)1395.91434.3
EBITDA ($mil)99.9132.1
EBIT ($mil)70.8104.5
Net Income ($mil)-45.533.1


Balance Sheet Q2 FY17 Q2 FY16
Cash & Equiv. ($mil)633.8741.5
Total Assets ($mil)3467.53638.1
Total Debt ($mil)1886.82188.4
Equity ($mil)-397.0-411.4


Profitability Q2 FY17 Q2 FY16
Gross Profit Margin64.4762.64
EBITDA Margin7.159.21
Operating Margin5.077.29
Sales Turnover1.651.59
Return on Assets-1.63-31.83
Return on Equity0.00.0
Debt Q2 FY17 Q2 FY16
Current Ratio1.351.47
Debt/Capital1.271.23
Interest Expense36.133.2
Interest Coverage1.963.15


Share Data Q2 FY17 Q2 FY16
Shares outstanding (mil)439.95437.02
Div / share0.00.0
EPS-0.120.07
Book value / share-0.9-0.94
Institutional Own % n/a n/a
Avg Daily Volume5955507.07457915.0

Valuation


SELL. This stock’s P/E ratio is negative, making its value useless in the assessment of premium or discount valuation, only displaying that the company has negative earnings per share. Along with this, the price-to-book ratio is also meaningless due to a negative book value for the company, making any comparisons useless. The price-to-sales ratio is well below both the S&P 500 average and the industry average, indicating a discount.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
AVP NM Peers 28.76   AVP 4.17 Peers 20.83

Neutral. The absence of a valid P/E ratio happens when a stock can not be valued on the basis of a negative stream of earnings.

AVP's P/E is negative making this valuation measure meaningless.

 

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.

AVP is trading at a significant discount to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
AVP 8.89 Peers 22.79   AVP NA Peers 0.75

Discount. A lower price-to-projected earnings ratio than its peers can signify a less expensive stock or lower future growth expectations.

AVP 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.

Ratio not available.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
AVP NM Peers 8.98   AVP 90.22 Peers 11.32

Neutral. 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.

AVP's P/B is negative making this valuation measure meaningless.

 

Higher. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

AVP is expected to have an earnings growth rate that significantly exceeds its peers.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
AVP 0.19 Peers 2.76   AVP -1.36 Peers 6.89

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.

AVP is trading at a significant discount to its industry on this measurement.

 

Lower. A sales growth rate that trails the industry implies that a company is losing market share.

AVP significantly trails its peers on the basis of sales growth

 

 

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