VALE : NYSE : Basic Materials
$8.17 | %
Today's Range: 8.03 - 8.28
Avg. Daily Volume: 2.85282E7
06/23/17 - 4:02 PM ET

Financial Analysis


VALE SA's gross profit margin for the first quarter of its fiscal year 2017 has significantly increased when compared to the same period a year ago. The company has grown sales and net income significantly, outpacing the average growth rates of competitors within its industry. VALE SA has weak liquidity. Currently, the Quick Ratio is 0.98 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 increased by 14.41% 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 Q1 FY17 Q1 FY16
Net Sales ($mil)8515.05335.0
EBITDA ($mil)4330.02003.0
EBIT ($mil)3455.01237.0
Net Income ($mil)2490.01776.0


Balance Sheet Q1 FY17 Q1 FY16
Cash & Equiv. ($mil)6793.03809.0
Total Assets ($mil)103008.095272.0
Total Debt ($mil)30776.031972.0
Equity ($mil)42037.036742.0


Profitability Q1 FY17 Q1 FY16
Gross Profit Margin54.6842.66
EBITDA Margin50.8537.54
Operating Margin40.5823.19
Sales Turnover0.290.24
Return on Assets4.55-7.59
Return on Equity14.29-19.16
Debt Q1 FY17 Q1 FY16
Current Ratio1.91.51
Debt/Capital0.420.47
Interest Expense1200.0770.0
Interest Coverage2.881.61


Share Data Q1 FY17 Q1 FY16
Shares outstanding (mil)5153.385153.38
Div / share0.00.0
EPS0.50.34
Book value / share8.167.13
Institutional Own % n/a n/a
Avg Daily Volume2.8521248E72.7755748E7

Valuation


BUY. VALE SA's P/E ratio indicates a significant discount compared to an average of 31.57 for the Metals & Mining industry and a significant discount compared to the S&P 500 average of 25.73. Conducting a second comparison, its price-to-book ratio of 0.96 indicates a significant discount versus the S&P 500 average of 3.08 and a discount versus the industry average of 1.62. The price-to-sales ratio is well below both the S&P 500 average and the industry average, indicating a discount. Upon assessment of these and other key valuation criteria, VALE SA 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
VALE 6.76 Peers 31.57   VALE 3.99 Peers 10.46

Discount. A lower P/E ratio than its peers can signify a less expensive stock or lower growth expectations.

VALE is trading at a significant discount to 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.

VALE 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
VALE 8.76 Peers 19.02   VALE 0.33 Peers 0.67

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

VALE is trading at a significant discount to its peers.

 

Discount. 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.

VALE trades at a significant discount to its peers.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
VALE 0.96 Peers 1.62   VALE 185.29 Peers 237.18

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.

VALE 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, VALE is expected to 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
VALE 1.33 Peers 2.66   VALE 34.72 Peers 7.04

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.

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

 

Higher. A sales growth rate that exceeds the industry implies that a company is gaining market share.

VALE has a sales growth rate that significantly exceeds its peers.

 

 

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