Avon Products Inc

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AVP : NYSE : Consumer Goods
$5.14 | %
Today's Range: 5.03 - 5.21
Avg. Daily Volume: 5422000.0
12/02/16 - 4:07 PM ET

Financial Analysis


AVON PRODUCTS's gross profit margin for the third quarter of its fiscal year 2016 is essentially unchanged when compared to the same period a year ago. Even though sales decreased, the net income has increased. AVON PRODUCTS has weak liquidity. Currently, the Quick Ratio is 0.89 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.

During the same period, stockholders' equity ("net worth") has remained unchanged 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 Q3 FY16 Q3 FY15
Net Sales ($mil)1408.81436.2
EBITDA ($mil)127.288.3
EBIT ($mil)98.858.4
Net Income ($mil)36.1-697.7


Balance Sheet Q3 FY16 Q3 FY15
Cash & Equiv. ($mil)901.7624.2
Total Assets ($mil)3905.53774.7
Total Debt ($mil)2338.12313.5
Equity ($mil)-789.0-781.5


Profitability Q3 FY16 Q3 FY15
Gross Profit Margin62.9263.56
EBITDA Margin9.026.14
Operating Margin7.014.07
Sales Turnover1.471.83
Return on Assets-10.86-30.38
Return on Equity0.00.0
Debt Q3 FY16 Q3 FY15
Current Ratio1.541.38
Debt/Capital1.511.51
Interest Expense34.429.6
Interest Coverage2.871.97


Share Data Q3 FY16 Q3 FY15
Shares outstanding (mil)437.52435.4
Div / share0.00.06
EPS0.07-1.51
Book value / share-1.8-1.79
Institutional Own % n/a n/a
Avg Daily Volume5184040.05646233.0

Valuation


SELL. The current P/E ratio is negative, which has no meaningful value in the assessment of premium or discount valuation, it simply displays that the company has negative earnings. 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 82.61   AVP 65.82 Peers 32.87

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.

 

Premium. 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 premium 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 17.27 Peers 20.76   AVP NA Peers 1.43

Premium. A higher price-to-projected earnings ratio than its peers can signify a more expensive stock or higher future growth expectations.

AVP is trading at a significant premium 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 14.59   AVP 89.73 Peers -0.88

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 0.43 Peers 1.77   AVP -16.50 Peers -0.20

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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