Valvoline (VVV) AI Stock Analysis

• Market Cap: $4.65B
• Dividend Yield: N/A
• Average Volume (3M): 1.74M
• Price to Earnings (P/E): 17.8
• Beta (1Y): 0.78
• Revenue Growth: 9.56%
• EPS Growth: 64.10%
• Country: US
• Employees: 10,500
• Sector: Energy
• Sector Strength: 42
• Industry: Oil & Gas Refining & Marketing
• EPS (TTM): 0.34
• Shares Outstanding: 127,111,680
• 10 Day Avg. Volume: 1,717,163
• 30 Day Avg. Volume: 1,737,906
• PEG Ratio: 0.21
• Price to Book (P/B): -46.85
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 12.82
• Enterprise Value/Market Cap: 1.45
• Enterprise Value/Revenue: 1.03
• Enterprise Value/Gross Profit: 10.53
• Enterprise Value/Ebitda: 3.33
• 1Y Price Target: $42.56
• Price Target Upside: 16.28% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 9

• Rating: 72 Outperform
• Price Target: $38.00 ▲(3.83%Upside)

Valvoline shows strong financial performance with robust revenue growth and strategic initiatives supporting expansion. Some financial risks remain due to high leverage and free cash flow constraints. The company is technically neutral, with fair valuation and positive sentiment from recent earnings and corporate events.

Positive Factors

Growth Potential

Valvoline has room for further expansion into attractive markets, with overall market growth suggesting long-term secular tailwinds.

Market Positioning

Valvoline is a best-in-class operator in a highly-fragmented market benefiting from non-discretionary, needs-based demand.

Negative Factors

Financial Performance

Margins came in softer and will remain pressured, with adjusted EBITDA margin missing expectations and showing a year-over-year decline.

Stock Performance

Shares could remain rangebound in the near term despite a maintained positive bias and Buy rating.

Valvoline Business Overview & Revenue Model

Company Description

Valvoline (VVV) is a leading global automotive and industrial lubricant supplier, specializing in the production, distribution, and marketing of premium branded automotive, commercial, and industrial lubricants, and automotive chemicals. Established in 1866, the company is recognized for its high-quality motor oils, additives, and maintenance products, serving both professional installers and do-it-yourself customers across various markets.

How the Company Makes Money

Valvoline makes money through multiple revenue streams, primarily from the sale of lubricants and related automotive products. The company operates a network of quick-lube service centers, branded as Valvoline Instant Oil Change, which provides oil change and preventive maintenance services. Revenue is generated through direct sales to consumers at these service locations as well as through retail and wholesale distribution channels where Valvoline products are sold to do-it-yourself consumers and professional installers. Additionally, Valvoline engages in strategic partnerships with automotive service providers and retailers to expand its market presence and drive sales growth.

Valvoline Financial Statement Overview

Summary

Valvoline's financials indicate strong revenue and profit growth with efficient operations and robust profitability margins. However, high leverage and limited equity buffer pose potential risks, and free cash flow constraints could impact financial flexibility.

Income Statement

Valvoline exhibits a strong income statement with consistent revenue growth reaching 1674 million in TTM (Trailing-Twelve-Months), a significant increase from 1619 million in the previous year. Gross profit margin stands at 38.3%, indicating efficient cost management. The net profit margin improved to 13.4% in TTM, showcasing enhanced profitability. EBIT and EBITDA margins are robust at 26.2% and 33.4%, respectively, reflecting strong operational efficiency.

Balance Sheet

The balance sheet indicates moderate leverage with a debt-to-equity ratio of 5.51 as of TTM, which is high but common in the industry. Return on equity is solid at 90.1%, highlighting effective use of equity to generate profits. However, the equity ratio is relatively low at 10.1%, suggesting limited equity buffer against liabilities.

Cash Flow

Cash flows are stable with an operating cash flow to net income ratio of 1.18, indicating strong cash generation relative to profits. However, free cash flow growth is negative, decreasing from 40.7 million to 22.7 million in TTM, driven by increased capital expenditures. The free cash flow to net income ratio is low at 0.10, suggesting limited free cash availability for debt servicing and investments.

Breakdown
TTM	Sep 2024	Sep 2023	Sep 2022	Sep 2021	Sep 2020
Income Statement		Total Revenue
1.67B	1.62B	1.44B	1.24B	1.04B	727.00M
	Gross Profit
641.20M	618.80M	544.50M	476.40M	432.30M	301.00M
	EBIT
438.70M	367.20M	247.20M	220.30M	240.10M	160.20M
	EBITDA
558.70M	367.20M	363.60M	284.70M	430.40M	591.00M
	Net Income Common Stockholders
224.00M	211.50M	1.42B	424.30M	420.30M	316.60M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
61.90M	68.30M	756.60M	23.40M	122.60M	760.00M
	Total Assets
2.45B	2.44B	2.89B	3.42B	3.19B	3.05B
	Total Debt
1.37B	1.37B	1.83B	1.92B	1.86B	2.19B
	Net Debt
1.31B	1.31B	1.42B	1.89B	1.74B	1.43B
	Total Liabilities
2.20B	2.25B	2.69B	3.11B	3.06B	3.13B
	Stockholders Equity
248.70M	185.60M	203.20M	306.60M	134.50M	-76.00M
Cash Flow		Free Cash Flow
22.70M	40.70M	-221.30M	152.20M	300.80M	277.70M
	Operating Cash Flow
265.30M	265.10M	-40.80M	284.20M	403.90M	371.70M
	Investing Cash Flow
-83.50M	136.80M	2.04B	-207.60M	-399.90M	-222.60M
	Financing Cash Flow
-613.10M	-746.30M	-1.67B	-218.90M	-535.50M	450.30M

Valvoline Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 36.60
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For VVV, the sentiment is Positive. The current price of 36.6 is above the 20-day moving average (MA) of 35.10, above the 50-day MA of 34.47, and below the 200-day MA of 37.74, indicating a neutral trend. The MACD of 0.59 indicates Negative momentum. The RSI at 61.49 is Neutral, neither overbought nor oversold. The STOCH value of 87.82 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for VVV.

Valvoline Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
VVV	72 Outperform	$4.65B	17.75	174.55%	―	9.56%	64.10%
DINO	71 Outperform	$7.03B	35.13	-1.49%	5.45%	-11.17%	-109.60%
UGP	71 Outperform	$3.18B	7.96	14.87%	3.70%	-4.58%	-23.80%
CSAN	64 Neutral	$2.77B	5.14	-69.81%	5.28%	-2.76%	-628.74%
Sector *	58 Neutral	$7.35B	3.36	-4.49%	5.60%	0.82%	-49.15%
CVI	53 Neutral	$2.49B	268.82	-27.14%	8.40%	-16.21%	-130.18%
PBF	48 Neutral	$2.12B	―	-18.01%	5.66%	-16.30%	-160.78%

Valvoline Corporate Events

Valvoline Appoints New CFO Amidst Financial Growth

On May 8, 2025, Valvoline announced the appointment of J. Kevin Willis as the new Chief Financial Officer, effective May 19, 2025, succeeding Mary E. Meixelsperger, who is retiring. The company also reported its second-quarter financial results, with a 4% increase in sales to $403 million and system-wide store sales growth of 11%. Despite a decline in income from continuing operations and EPS, Valvoline remains optimistic about its growth prospects, including the acquisition of Breeze Autocare to accelerate growth and earnings potential.