We’ve recently updated our valuation analysis.

Velocity Financial Valuation

Is VEL undervalued compared to its fair value, analyst forecasts and its price relative to the market?

[object Object] Score

2/6

Valuation Score 2/6

  • Price-To-Earnings vs Peers

  • Price-To-Earnings vs Industry

  • Price-To-Earnings vs Fair Ratio

  • Below Fair Value

  • Significantly Below Fair Value

  • Analyst Forecast

Key Valuation Metric

Which metric is best to use when looking at relative valuation for VEL?

Other financial metrics that can be useful for relative valuation.

VEL key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenuen/a
Enterprise Value/EBITDAn/a
PEG Ratio0.2x

Price to Earnings Ratio vs Peers

How does VEL's PE Ratio compare to its peers?

The above table shows the PE ratio for VEL vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
CompanyPEEstimated GrowthMarket Cap
Peer Average9.7x
HBCP Home Bancorp
10.6x11.6%US$355.9m
NASB NASB Financial
10xn/aUS$375.9m
ATAX America First Multifamily Investors
6.7x-51.3%US$424.9m
WSBF Waterstone Financial
11.6x-0.9%US$361.6m
VEL Velocity Financial
10.4x50.4%US$329.7m

Price-To-Earnings vs Peers: VEL is expensive based on its Price-To-Earnings Ratio (10.4x) compared to the peer average (9.7x).


Price to Earnings Ratio vs Industry

How does VEL's PE Ratio compare vs other companies in the US Mortgage Industry?

0 CompaniesPrice / EarningsEstimated GrowthMarket Cap
Industry Avg.n/a8.5%
n/an/an/a

Price-To-Earnings vs Industry: VEL is good value based on its Price-To-Earnings Ratio (10.4x) compared to the US Mortgage industry average (11.6x)


Price to Earnings Ratio vs Fair Ratio

What is VEL's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

VEL PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio10.4x
Fair PE Ratio12.7x

Price-To-Earnings vs Fair Ratio: VEL is good value based on its Price-To-Earnings Ratio (10.4x) compared to the estimated Fair Price-To-Earnings Ratio (12.7x).


Share Price vs Fair Value

What is the Fair Price of VEL when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: VEL ($10.17) is trading above our estimate of fair value ($4.23)

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


Analyst Price Targets

What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?

The above table shows the analyst VEL forecast and predictions for the stock price in 12 month’s time.
DateShare PriceAverage 1Y Price TargetDispersionHighLow1Y Actual priceAnalysts
CurrentUS$10.17
US$11.38
+11.8%
8.4%US$12.50US$10.00n/a4
Nov ’23US$9.38
US$14.00
+49.3%
15.2%US$17.00US$11.00n/a4
Oct ’23US$10.84
US$14.75
+36.1%
8.8%US$17.00US$14.00n/a4
Sep ’23US$11.60
US$14.75
+27.2%
8.8%US$17.00US$14.00n/a4
Aug ’23US$11.17
US$14.25
+27.6%
11.5%US$17.00US$13.00n/a4
Jul ’23US$11.31
US$14.25
+26.0%
11.5%US$17.00US$13.00n/a4
Jun ’23US$10.83
US$14.25
+31.6%
11.5%US$17.00US$13.00n/a4
May ’23US$10.70
US$15.25
+42.5%
7.1%US$17.00US$14.00n/a4
Apr ’23US$10.50
US$15.75
+50.0%
5.3%US$17.00US$15.00n/a4
Mar ’23US$12.54
US$16.00
+27.6%
4.4%US$17.00US$15.00n/a4
Feb ’23US$12.89
US$16.00
+24.1%
4.4%US$17.00US$15.00n/a4
Jan ’23US$13.70
US$16.00
+16.8%
4.4%US$17.00US$15.00n/a4
Dec ’22US$12.44
US$16.00
+28.6%
4.4%US$17.00US$15.00US$10.174
Nov ’22US$12.53
US$15.25
+21.7%
7.1%US$17.00US$14.00US$9.384
Oct ’22US$13.24
US$15.25
+15.2%
7.1%US$17.00US$14.00US$10.844
Sep ’22US$12.91
US$15.25
+18.1%
7.1%US$17.00US$14.00US$11.604
Aug ’22US$12.65
US$11.50
-9.1%
4.3%US$12.00US$11.00US$11.174
Jul ’22US$12.82
US$11.50
-10.3%
4.3%US$12.00US$11.00US$11.314
Jun ’22US$11.00
US$11.50
+4.5%
4.3%US$12.00US$11.00US$10.834
May ’22US$9.06
US$10.38
+14.5%
9.3%US$12.00US$9.50US$10.704
Apr ’22US$8.97
US$10.38
+15.7%
9.3%US$12.00US$9.50US$10.504
Mar ’22US$7.34
US$8.25
+12.4%
13.2%US$10.00US$7.00US$12.544
Feb ’22US$7.20
US$7.50
+4.2%
6.7%US$8.00US$7.00US$12.894
Jan ’22US$6.23
US$7.50
+20.4%
6.7%US$8.00US$7.00US$13.704
Dec ’21US$6.35
US$7.50
+18.1%
6.7%US$8.00US$7.00US$12.444

Analyst Forecast: Target price is more than 20% higher than the current share price, but analysts are not within a statistically confident range of agreement.


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