KBR : NYSE : Industrial Services
$17.96 -0.15 | -0.83%
Today's Range: 17.89 - 18.285
Avg. Daily Volume: 1575400.0
02/16/18 - 4:02 PM ET

Financial Analysis


KBR INC's gross profit margin for the third quarter of its fiscal year 2017 has significantly increased when compared to the same period a year ago. Even though sales decreased, the net income has increased, representing an increase to the bottom line. KBR INC has average liquidity. Currently, the Quick Ratio is 1.22 which shows that technically this company has the 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 decreased by 21.96% from the same quarter last year. Together, the key liquidity measurements indicate that it is relatively unlikely that the company will face financial difficulties in the near future.

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Income Statement Q3 FY17 Q3 FY16
Net Sales ($mil)1034.01073.0
EBITDA ($mil)61.0-58.0
EBIT ($mil)50.0-70.0
Net Income ($mil)45.0-63.0


Balance Sheet Q3 FY17 Q3 FY16
Cash & Equiv. ($mil)511.0569.0
Total Assets ($mil)3601.04242.0
Total Debt ($mil)512.0699.0
Equity ($mil)867.01111.0


Profitability Q3 FY17 Q3 FY16
Gross Profit Margin9.48-2.24
EBITDA Margin5.89-5.4
Operating Margin4.84-6.52
Sales Turnover1.220.98
Return on Assets1.991.6
Return on Equity8.36.12
Debt Q3 FY17 Q3 FY16
Current Ratio1.31.15
Debt/Capital0.370.39
Interest Expense6.03.0
Interest Coverage8.33-23.33


Share Data Q3 FY17 Q3 FY16
Shares outstanding (mil)140.08142.67
Div / share0.080.08
EPS0.32-0.44
Book value / share6.197.79
Institutional Own % n/a n/a
Avg Daily Volume1919669.01812169.0

Valuation


BUY. KBR INC's P/E ratio indicates a premium compared to an average of 31.64 for the Construction & Engineering industry and a premium compared to the S&P 500 average of 24.11. Conducting a second comparison, its price-to-book ratio of 2.78 indicates a discount versus the S&P 500 average of 3.08 and a premium versus the industry average of 2.26. The current price-to-sales ratio is well below the S&P 500 average and is also below the industry average, indicating a discount. After reviewing these and other key valuation criteria, KBR INC proves to trade at a premium to investment alternatives within the industry.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
KBR 33.73 Peers 31.64   KBR 8.31 Peers 13.42

Average. An average P/E ratio can signify an industry neutral price for a stock and an average growth expectation.

KBR is trading at a valuation on par with 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.

KBR 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
KBR 12.46 Peers 22.22   KBR NM Peers 0.90

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

KBR 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.

KBR's negative PEG ratio makes this valuation measure meaningless.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
KBR 2.78 Peers 2.26   KBR 8.51 Peers 12.20

Premium. A higher price-to-book ratio makes a stock less attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

KBR is trading at a premium to its peers.

 

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

However, KBR is expected to significantly trail its peers on the basis of its earnings growth rate.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
KBR 0.55 Peers 0.63   KBR 5.55 Peers 15.16

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.

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

 

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

KBR significantly trails its peers on the basis of sales growth

 

 

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