NYSE:VSM

Stock Analysis Report

Executive Summary

Versum Materials, Inc. develops, manufactures, transports, and handles specialty materials for the semiconductor and display industries in the United States, Taiwan, South Korea, China, Europe, and rest of Asia.

Snowflake

Fundamentals

Moderate growth potential with questionable track record.


Similar Companies

Share Price & News

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


Latest Share Price and Events


Market Performance


7 Day Return

0.1%

VSM

3.8%

US Semiconductor

2.3%

US Market


1 Year Return

55.9%

VSM

18.2%

US Semiconductor

5.6%

US Market

Return vs Industry: VSM exceeded the US Semiconductor industry which returned 18.2% over the past year.

Return vs Market: VSM exceeded the US Market which returned 5.6% over the past year.


Shareholder returns

VSMIndustryMarket
7 Day0.1%3.8%2.3%
30 Day1.6%-0.03%-1.0%
90 Day2.3%4.4%-0.7%
1 Year57.0%55.9%20.5%18.2%7.9%5.6%
3 Year129.3%125.6%82.3%71.6%45.6%36.3%
5 Yearn/a140.3%115.5%65.8%47.6%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

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

5.6%

Undervalued compared to fair value


Share Price vs. Fair Value

Undervalued: VSM ($52.99) is trading below our estimate of fair value ($56.16)

Significantly Undervalued: VSM is trading below fair value, but not by a significant amount.


Price To Earnings Ratio

PE vs Industry: VSM is poor value based on its PE Ratio (73.4x) compared to the Semiconductor industry average (27.7x).

PE vs Market: VSM is poor value based on its PE Ratio (73.4x) compared to the US market (17.7x).


Price to Earnings Growth Ratio

Low PEG Ratio: VSM is poor value based on its PEG Ratio (1.3x)


Price to Book Ratio

PB vs Industry: VSM is overvalued based on its PB Ratio (33.6x) compared to the US Semiconductor industry average (2.8x).


Next Steps

Future Growth

How is Versum Materials forecast to perform in the next 1 to 3 years based on estimates from 5 analysts?

56.9%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: VSM's forecast earnings growth (56.9% per year) is above the savings rate (2.7%).

Earnings vs Market: VSM's earnings (56.9% per year) are forecast to grow faster than the US market (14.5% per year).

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

Revenue vs Market: VSM's revenue (1.9% per year) is forecast to grow slower than the US market (7.3% per year).

High Growth Revenue: VSM's revenue (1.9% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

High Future ROE: Insufficient data to determine if VSM's Return on Equity is forecast to be high in 3 years time


Next Steps

Past Performance

How has Versum Materials performed over the past 5 years?

0.2%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

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

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

Earnings vs Industry: VSM had negative earnings growth (-58.2%) over the past year, making it difficult to compare to the Semiconductor industry average (-6.2%).


Return on Equity

High ROE: Whilst VSM's Return on Equity (42.04%) is outstanding, this metric is skewed due to their high level of debt.


Return on Assets

ROA vs Industry: VSM has a higher Return on Assets than the Semiconductor industry average last year.


Return on Capital Employed

ROCE Improving: VSM's Return on Capital Employed has declined over the past 3 years.


Next Steps

Financial Health

How is Versum Materials's financial position?


Financial Position Analysis

Short Term Liabilities: VSM's short term assets ($735.2M) exceeds its short term liabilities ($169.6M)

Long Term Liabilities: VSM's short term assets (735.2M) do not cover its long term liabilities (1.1B)


Debt to Equity History and Analysis

Debt Level: VSM's debt to equity ratio (480.4%) is considered high

Reducing Debt: Insufficient data to determine if VSM's debt to equity ratio has reduced over the past 5 years.

Debt Coverage: VSM's debt is not well covered by operating cash flow (13.5%).

Interest Coverage: VSM's interest payments on its debt are well covered by EBIT (7.6x coverage).


Balance Sheet

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

Debt Coverage by Assets: VSM's debt is not covered by short term assets (assets are 0.8x debt).


Next Steps

Dividend

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

0.60%

Current Dividend Yield


Dividend Yield vs Market

company0.6%marketbottom25%1.5%markettop25%3.8%industryaverage2.2%forecastin3Years0.7%

Current dividend yield vs market & industry


Stability and Growth of Payments

Notable Dividend: VSM's dividend (0.6%) isn’t notable compared to the bottom 25% of dividend payers in the US market (1.46%).

High Dividend: VSM's dividend (0.6%) is low compared to the top 25% of dividend payers in the US market (3.76%).

Stable Dividend: VSM is not paying a notable dividend for the US market, therefore no need to check if payments are stable.

Growing Dividend: VSM is not paying a notable dividend for the US market, therefore no need to check if payments are increasing.


Current Payout to Shareholders

Dividend Coverage: VSM is not paying a notable dividend for the US market.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of VSM's dividend in 3 years as they are not forecast to pay a notable one for the US market.


Next Steps

Management

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

2.8yrs

Average management tenure


CEO

Guillermo Novo (57yo)

0yrs

Tenure

US$4,809,960

Compensation

Mr. Guillermo Novo serves as Chief Executive Officer and President of Versum Materials, Inc. Mr. Novo was a Director of Bemis Company, Inc. since March 16, 2018 until June 11, 2019. He served as an Executi ...


CEO Compensation Analysis

Compensation vs. Market: Guillermo's total compensation ($USD4.81M) is about average for companies of similar size in the US market ($USD6.81M).

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


Management Age and Tenure

2.8yrs

Average Tenure

57yo

Average Age

Experienced Management: VSM's management team is considered experienced (2.8 years average tenure).


Board Age and Tenure

3.0yrs

Average Tenure

63yo

Average Age

Experienced Board: VSM's board of directors are considered experienced (3 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.


Recent Insider Transactions

BuyUS$174,15012 Dec 18
Thomas Riordan
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares6,000
Max PriceUS$29.03
BuyUS$290,15012 Dec 18
Susan Schnabel
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares10,000
Max PriceUS$29.02
BuyUS$62,76311 Dec 18
Susan Schnabel
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares2,000
Max PriceUS$31.91
BuyUS$166,87013 Nov 18
Susan Schnabel
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares5,000
Max PriceUS$33.87
BuyUS$150,95813 Nov 18
Thomas Riordan
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares4,600
Max PriceUS$32.82
BuyUS$102,13113 Nov 18
Jacques Croisetière
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares3,000
Max PriceUS$34.04
BuyUS$668,20013 Nov 18
Seifollah Ghasemi
EntityIndividual
Role
Chairman of the Board
Non-Executive Chairman
Shares20,000
Max PriceUS$33.41

Ownership Breakdown


Management Team

  • Ed Shober (59yo)

    Senior Vice President of Materials

    • Tenure: 2.7yrs
    • Compensation: US$2.01m
  • Guillermo Novo (57yo)

    President

    • Tenure: 0yrs
    • Compensation: US$4.81m
  • George Bitto (60yo)

    Executive VP & CFO

    • Tenure: 3yrs
    • Compensation: US$2.36m
  • Michael Valente (51yo)

    Senior VP of Law

    • Tenure: 0yrs
    • Compensation: US$1.61m
  • John Langan (59yo)

    Senior VP & CTO

    • Tenure: 2.8yrs
  • Jessica Feather-Bowman (44yo)

    VP, Controller & Principal Accounting Officer

    • Tenure: 3.1yrs
  • Jeff White (51yo)

    Senior Vice President of Delivery Systems & Services

    • Tenure: 1.9yrs
  • Meili Chen

    Vice President of Human Resources

    • Tenure: 1yrs
  • Soohwan Kim

    Head of Investor Relations

    • Tenure: 0yrs

Board Members

  • Seifi Ghasemi (75yo)

    Non-Executive Chairman

    • Tenure: 3.1yrs
    • Compensation: US$283.00k
  • Yi Paik (63yo)

    Independent Director

    • Tenure: 3yrs
    • Compensation: US$233.00k
  • Jacques Croisetière (65yo)

    Independent Director

    • Tenure: 3yrs
    • Compensation: US$253.00k
  • Susan Schnabel (57yo)

    Independent Director

    • Tenure: 3yrs
    • Compensation: US$233.00k
  • Tom Riordan (69yo)

    Independent Director

    • Tenure: 3yrs
    • Compensation: US$248.00k
  • Guillermo Novo (57yo)

    President

    • Tenure: 0yrs
    • Compensation: US$4.81m
  • Alejandro Wolff (62yo)

    Lead Director

    • Tenure: 2.4yrs
    • Compensation: US$243.00k

Company Information

Versum Materials, Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Versum Materials, Inc.
  • Ticker: VSM
  • Exchange: NYSE
  • Founded: 2015
  • Industry: Semiconductor Equipment
  • Sector: Semiconductors
  • Market Cap: US$5.790b
  • Shares outstanding: 109.27m
  • Website: https://www.versummaterials.com

Number of Employees


Location

  • Versum Materials, Inc.
  • 8555 South River Parkway
  • Tempe
  • Arizona
  • 85284
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
2V1DB (Deutsche Boerse AG)YesCommon StockDEEURSep 2016
VSMNYSE (New York Stock Exchange)YesCommon StockUSUSDSep 2016

Biography

Versum Materials, Inc. develops, manufactures, transports, and handles specialty materials for the semiconductor and display industries in the United States, Taiwan, South Korea, China, Europe, and rest of ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/10/07 02:39
End of Day Share Price2019/10/04 00:00
Earnings2019/06/30
Annual Earnings2018/09/30


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.