Staples Inc

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SPLS : NASDAQ : Services
$9.31 up 0.04 | 0.43%
Today's Range: 9.15 - 9.32
Avg. Daily Volume: 6291600.0
02/17/17 - 4:00 PM ET

Financial Analysis


STAPLES INC'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. Sales and net income have dropped, underperforming the average competitor within its industry. STAPLES INC has weak liquidity. Currently, the Quick Ratio is 0.91 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 decreased by 12.96% 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 ($mil)5355.05593.0
EBITDA ($mil)464.0466.0
EBIT ($mil)355.0355.0
Net Income ($mil)180.0198.0


Balance Sheet Q3 FY16 Q3 FY15
Cash & Equiv. ($mil)1076.0782.0
Total Assets ($mil)9387.010318.0
Total Debt ($mil)1047.01035.0
Equity ($mil)4647.05339.0


Profitability Q3 FY16 Q3 FY15
Gross Profit Margin28.7228.91
EBITDA Margin8.668.33
Operating Margin6.636.35
Sales Turnover2.182.08
Return on Assets-4.880.31
Return on Equity-9.870.61
Debt Q3 FY16 Q3 FY15
Current Ratio1.651.64
Debt/Capital0.180.16
Interest Expense11.011.0
Interest Coverage32.2732.27


Share Data Q3 FY16 Q3 FY15
Shares outstanding (mil)650.54643.6
Div / share0.120.12
EPS0.270.31
Book value / share7.148.3
Institutional Own % n/a n/a
Avg Daily Volume6414375.07524222.0

Valuation


HOLD. 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. For additional comparison, its price-to-book ratio of 1.30 indicates a significant discount versus the S&P 500 average of 2.94 and a significant discount versus the industry average of 15.12. The price-to-sales ratio is well below both the S&P 500 average and the industry average, indicating a discount. After reviewing these and other key valuation criteria, STAPLES INC proves to trade at a discount 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
SPLS NM Peers 22.84   SPLS 6.67 Peers 14.57

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.

SPLS'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.

SPLS 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
SPLS 10.19 Peers 20.41   SPLS NA Peers 1.96

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

SPLS 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
SPLS 1.30 Peers 15.12   SPLS -1540.00 Peers -16.65

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.

SPLS is trading at a significant discount to its peers.

 

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

However, SPLS 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
SPLS 0.29 Peers 1.53   SPLS -4.53 Peers 7.69

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.

SPLS 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.

SPLS significantly trails its peers on the basis of sales growth

 

 

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