Avon Products Inc.

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AVP : NYSE : Consumer Non-Durables
$2.765 -0.085 | -3.0%
Today's Range: 2.67 - 2.94
Avg. Daily Volume: 3591300.0
02/21/18 - 2:58 PM ET

Financial Analysis


AVON PRODUCTS's gross profit margin for the fourth quarter of its fiscal year 2017 is essentially unchanged when compared to the same period a year ago. The company has grown sales and net income during the past quarter when compared with the same quarter a year ago, however, it was unable to keep up with the growth of the average competitor within its industry. AVON PRODUCTS has weak liquidity. Currently, the Quick Ratio is 0.86 which shows a lack of 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 36.22% 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 Q4 FY17 Q4 FY16
Net Sales ($mil)1568.81568.1
EBITDA ($mil)182.1142.6
EBIT ($mil)153.7114.2
Net Income ($mil)91.5-10.7


Balance Sheet Q4 FY17 Q4 FY16
Cash & Equiv. ($mil)881.5654.4
Total Assets ($mil)3697.93418.9
Total Debt ($mil)1897.91893.9
Equity ($mil)-257.2-403.3


Profitability Q4 FY17 Q4 FY16
Gross Profit Margin62.962.18
EBITDA Margin11.69.09
Operating Margin9.87.28
Sales Turnover1.551.67
Return on Assets0.59-3.13
Return on Equity0.00.0
Debt Q4 FY17 Q4 FY16
Current Ratio1.431.34
Debt/Capital1.161.27
Interest Expense34.836.3
Interest Coverage4.423.15


Share Data Q4 FY17 Q4 FY16
Shares outstanding (mil)440.0437.6
Div / share0.00.0
EPS0.17-0.03
Book value / share-0.58-0.92
Institutional Own % n/a n/a
Avg Daily Volume3598623.03942642.0

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 26.83   AVP 4.31 Peers 19.53

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 9.35 Peers 21.69   AVP NA Peers 1.20

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 9.65   AVP 84.00 Peers -2.01

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 0.20 Peers 2.51   AVP -0.04 Peers 19.40

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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