INNOVATE Corp. (VATE) stock analysis

P/E against its history

Not enough price and earnings history to compare.

P/E against the industry

Needs positive earnings and enough profitable companies in the industry.

EV/EBITDA below its 5-year median

Innovate's EV/EBITDA of 7.0 is below its 5-year median of 16.1.

P/S below the industry

Innovate's price-to-sales of 0.05 is below the Fabricated Metal Products, except Machinery and Transportation Equipment median of 1.76 (book value is negative, so we use sales).

Trading below fair value

The share price of $5.27 is below our fair value estimate of $46.04.

Margin of safety over 20%

The price is 88.6% below fair value, more than the 20% cushion we look for.

Revenue growing under 10% a year

Revenue grew -8.7% a year over the last three fiscal years, short of the 10% we look for.

EPS growth over 3 years

Needs positive EPS three years ago and today.

Earnings acceleration

Needs positive net income now, a year ago and five years ago.

Growing faster than the industry

Revenue grew 52.4% over the last twelve months; the Fabricated Metal Products, except Machinery and Transportation Equipment median is 9.7%.

Company guidance

No outlook found in earnings releases from the last twelve months.

Gross margin slipping

Gross margin was 15.9% over the last twelve months, against 18.7% a year earlier.

Return on equity

Needs positive equity and five years of results.

Return on capital over 10%

Return on invested capital was 15.3%, above the 10% that usually covers the cost of capital.

Return on equity against the industry

Needs positive equity.

Earnings over 5 years

Needs positive net income five years ago and in the latest year.

Net margin above its 5-year average

Net margin was -1.5% over the last twelve months, against a 5-year average of -6.3%.

Net margin below the industry

Innovate's net margin of -1.5% is below the Fabricated Metal Products, except Machinery and Transportation Equipment median of 0.5%.

Debt level

Needs debt and equity figures.

Debt trend

Needs a balance sheet from five years ago with positive equity.

Debt covered by cash flow

Operating cash flow over the last twelve months equals 22.9% of total debt.

Interest not well covered

Operating income covers interest expense 0.7 times; we look for at least 5.

Short-term assets don't cover short-term debts

Current assets are 0.44 times current liabilities.

Elevated bankruptcy risk

The Altman Z-score is 0.22; above 3 is the safe zone and below 1.8 the distress zone.

No dividend

Innovate has not paid a dividend in the last twelve months.

Yield against Treasuries

No dividend.

Yield against the market

No dividend.

Dividend stability

No dividend.

Earnings cover

No dividend.

Cash-flow cover

No dividend.