ENXTPA:FR

Stock Analysis Report

Executive Summary

Valeo SA designs, produces, and sells components, integrated systems, and modules for the automotive sector worldwide.

Rewards

Earnings are forecast to grow 27.72% per year

Risk Analysis

Has a high level of debt

Dividend of 3.95% is not well covered by earnings

Highly volatile share price over past 3 months

Profit margins (1.3%) are lower than last year (4.4%)



Snowflake Analysis

Moderate growth potential with mediocre balance sheet.


Similar Companies

Share Price & News

How has Valeo's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: FR's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

-9.7%

FR

-7.5%

FR Auto Components

-3.6%

FR Market


1 Year Return

4.2%

FR

5.4%

FR Auto Components

18.9%

FR Market

Return vs Industry: FR underperformed the French Auto Components industry which returned 16% over the past year.

Return vs Market: FR underperformed the French Market which returned 24.9% over the past year.


Shareholder returns

FRIndustryMarket
7 Day-9.7%-7.5%-3.6%
30 Day-13.4%-7.9%-2.2%
90 Day-18.6%-10.3%2.9%
1 Year9.6%4.2%9.3%5.4%23.1%18.9%
3 Year-46.6%-51.3%-10.7%-17.9%41.0%27.6%
5 Year-25.3%-34.3%14.5%0.9%58.4%35.8%

Price Volatility Vs. Market

How volatile is Valeo's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Valeo undervalued compared to its fair value and its price relative to the market?

25.67x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: FR (€31.65) is trading above our estimate of fair value (€16.36)

Significantly Below Fair Value: FR is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: FR is poor value based on its PE Ratio (29.5x) compared to the Auto Components industry average (9.1x).

PE vs Market: FR is poor value based on its PE Ratio (29.5x) compared to the French market (18.1x).


Price to Earnings Growth Ratio

PEG Ratio: FR is good value based on its PEG Ratio (1x)


Price to Book Ratio

PB vs Industry: FR is overvalued based on its PB Ratio (1.5x) compared to the FR Auto Components industry average (1.5x).


Next Steps

Future Growth

How is Valeo forecast to perform in the next 1 to 3 years based on estimates from 17 analysts?

27.7%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: FR's forecast earnings growth (27.7% per year) is above the savings rate (-0.1%).

Earnings vs Market: FR's earnings (27.7% per year) are forecast to grow faster than the French market (11.7% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: FR's revenue (4.5% per year) is forecast to grow slower than the French market (4.7% per year).

High Growth Revenue: FR's revenue (4.5% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: FR's Return on Equity is forecast to be low in 3 years time (13.1%).


Next Steps

Past Performance

How has Valeo performed over the past 5 years?

0.2%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: FR has high quality earnings.

Growing Profit Margin: FR's current net profit margins (1.3%) are lower than last year (4.4%).


Past Earnings Growth Analysis

Earnings Trend: FR's earnings have grown by 0.2% per year over the past 5 years.

Accelerating Growth: FR's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: FR had negative earnings growth (-69.1%) over the past year, making it difficult to compare to the Auto Components industry average (-8.3%).


Return on Equity

High ROE: FR's Return on Equity (6.5%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Valeo's financial position?


Financial Position Analysis

Short Term Liabilities: FR's short term assets (€7.8B) do not cover its short term liabilities (€8.0B).

Long Term Liabilities: FR's short term assets (€7.8B) exceed its long term liabilities (€6.2B).


Debt to Equity History and Analysis

Debt Level: FR's debt to equity ratio (98.9%) is considered high.

Reducing Debt: FR's debt to equity ratio has increased from 74.5% to 98.9% over the past 5 years.

Debt Coverage: FR's debt is well covered by operating cash flow (46.8%).

Interest Coverage: FR's interest payments on its debt are well covered by EBIT (13.9x coverage).


Balance Sheet

Inventory Level: FR has a high level of physical assets or inventory.

Debt Coverage by Assets: FR's debt is covered by short term assets (assets are 1.5x debt).


Next Steps

Dividend

What is Valeo's current dividend yield, its reliability and sustainability?

4.54%

Current Dividend Yield


Dividend Yield vs Market

company4.5%marketbottom25%1.5%markettop25%4.6%industryaverage3.5%forecastin3Years4.3%

Current dividend yield vs market & industry

Notable Dividend: FR's dividend (3.95%) is higher than the bottom 25% of dividend payers in the French market (1.46%).

High Dividend: FR's dividend (4.54%) is low compared to the top 25% of dividend payers in the French market (4.56%).


Stability and Growth of Payments

Stable Dividend: Whilst dividend payments have been stable, FR has been paying a dividend for less than 10 years.

Growing Dividend: FR's dividend payments have increased, but the company has only paid a dividend for 9 years.


Current Payout to Shareholders

Dividend Coverage: With its high payout ratio (116.5%), FR's dividend payments are not well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: FR's dividends in 3 years are forecast to be well covered by earnings (36.9% payout ratio).


Next Steps

Management

What is the CEO of Valeo's salary, the management and board of directors tenure and is there insider trading?

8.0yrs

Average management tenure


CEO

Jacques Aschenbroich (65yo)

10.8yrs

Tenure

€4,154,616

Compensation

Mr. Jacques Aschenbroich has been the Chairman at Valeo SA since February 18, 2016 and also its Chief Executive Officer since March 20, 2009. Mr. Aschenbroich served as the Chief Executive Officer and Pres ...


CEO Compensation Analysis

Compensation vs Market: Jacques's total compensation ($USD4.62M) is above average for companies of similar size in the French market ($USD2.65M).

Compensation vs Earnings: Jacques's compensation has been consistent with company performance over the past year.


Management Age and Tenure

8.0yrs

Average Tenure

62yo

Average Age

Experienced Management: FR's management team is seasoned and experienced (8 years average tenure).


Board Age and Tenure

3.8yrs

Average Tenure

63.5yo

Average Age

Experienced Board: FR's board of directors are considered experienced (3.7 years average tenure).


Insider Trading

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Management Team

  • Jacques Aschenbroich (65yo)

    Chairman & CEO

    • Tenure: 10.8yrs
    • Compensation: €4.15m
  • Robert Charvier

    Chief Financial Officer

    • Tenure: 10yrs
  • Hans-Peter Kunze

    Executive Vice President of Sales & Business Development

    • Tenure: 1.3yrs
  • Christophe Périllat-Piratoine (54yo)

    Chief Operating Officer

    • Tenure: 8.8yrs
  • Éric Schuler

    President of Valeo Service Activity

    • Tenure: 4yrs
  • Bruno Guillemet (62yo)

    Senior Vice-President of Human Resources

    • Tenure: 4.3yrs
  • Thierry Lacorre

    Investor Relations Director

    • Fabienne de Brébisson

      Vice President of Communications

      • Tenure: 9yrs
    • Catherine Delhaye

      Chief Ethics & Compliance Officer

      • Tenure: 8yrs
    • Eric Fredette

      General Counsel

      • Tenure: 5yrs

    Board Members

    • Caroline Devine (68yo)

      Independent Director

      • Tenure: 4.8yrs
      • Compensation: €64.00k
    • Thierry Moulonguet (68yo)

      Independent Director

      • Tenure: 8.6yrs
      • Compensation: €88.08k
    • Jacques Aschenbroich (65yo)

      Chairman & CEO

      • Tenure: 10.8yrs
      • Compensation: €4.15m
    • Georges Pauget (72yo)

      Independent Director

      • Tenure: 12.8yrs
      • Compensation: €140.00k
    • Bruno Bézard (56yo)

      Independent director

      • Tenure: 2.3yrs
      • Compensation: €49.00k
    • Véronique Weill (60yo)

      Independent Director

      • Tenure: 3.7yrs
      • Compensation: €67.00k
    • Ulrike Steinhorst (68yo)

      Independent Director

      • Tenure: 8.9yrs
      • Compensation: €88.00k
    • Mari-Noëlle Jégo-Laveissière (51yo)

      Independent Director

      • Tenure: 3.7yrs
      • Compensation: €67.00k
    • Eric Chauvirey (44yo)

      Employee Representative Director

      • Tenure: 2.6yrs
      • Compensation: €64.00k
    • Gilles Michel (62yo)

      Lead Director & Independent Director

      • Tenure: 1yrs
      • Compensation: €27.50k

    Company Information

    Valeo SA's company bio, employee growth, exchange listings and data sources


    Key Information

    • Name: Valeo SA
    • Ticker: FR
    • Exchange: ENXTPA
    • Founded: 1923
    • Industry: Auto Parts and Equipment
    • Sector: Automobiles
    • Market Cap: €6.575b
    • Shares outstanding: 238.82m
    • Website: https://www.valeo.com

    Number of Employees


    Location

    • Valeo SA
    • 43, rue Bayen
    • Paris
    • Ile-de-France
    • 75017
    • France

    Listings

    TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
    VLEE.FOTCPK (Pink Sheets LLC)YesCommon SharesUSUSDJan 1980
    FRENXTPA (Euronext Paris)YesCommon SharesFREURJan 1980
    0RH5LSE (London Stock Exchange)YesCommon SharesGBEURJan 1980
    VSA2DB (Deutsche Boerse AG)YesCommon SharesDEEURJan 1980
    FRPBATS-CHIXE (BATS 'Chi-X Europe')YesCommon SharesGBEURJan 1980
    FRWBAG (Wiener Boerse AG)YesCommon SharesATEURJan 1980
    FRT NBMV (Bolsa Mexicana de Valores)YesCommon SharesMXMXNJan 1980
    FRSWX (SIX Swiss Exchange)YesCommon SharesCHCHFJan 1980
    VSA2ETLX (Eurotlx)YesCommon SharesITEURJan 1980
    VLEE.YOTCPK (Pink Sheets LLC)SPONSORED ADRUSUSDSep 1995

    Biography

    Valeo SA designs, produces, and sells components, integrated systems, and modules for the automotive sector worldwide. The company operates through four segments: Comfort & Driving Assistance Systems, Powertrain Systems, Thermal Systems, and Visibility Systems. It offers parking and driving assistance products, such as ultrasonic sensors, radars, and cameras to detect obstacles around vehicles; intuitive control products; and a range of connectivity solutions from short-range to long-range connectivity, as well as develops systems that enable the integration of applications, such as car sharing services and remote parking systems. The company also manufactures powertrain systems, including electric powertrain systems for the electric cars; products that enable the automation of transmissions to reduce fuel consumption and enhance driving comfort; and clean engines for vehicles. In addition, it designs and manufactures systems, modules, and components to optimize thermal management of vehicles and passenger comfort in the cabin. Further, the company designs and produces lighting and wiper systems for drivers in all weather conditions. In addition, it offers original equipment spares to auto manufacturers and the independent aftermarket; replacement parts and accessories for passenger cars and commercial vehicles; air conditioning systems for buses; cabin 3D image processing software; hydraulic actuators; and torque converters. The company has a collaboration agreement with Dana Incorporated to develop and supply electric-vehicle systems. Valeo SA was founded in 1923 and is headquartered in Paris, France. 


    Company Analysis and Financial Data Status

    All financial data provided by Standard & Poor's Capital IQ.
    DataLast Updated (UTC time)
    Company Analysis2020/01/28 20:38
    End of Day Share Price2020/01/28 00:00
    Earnings2019/06/30
    Annual Earnings2018/12/31


    Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.