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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
Dxp Enterprises, Inc. (XNAS:DXPE) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
DXPE
Name:
DXP ENTERPRISES, INC. (XNAS:DXPE)
Sector:
1.94M
Industry:
Industrial Distribution
CEO:
Mr. David Little
Total Employees:
2,490
Our Technological Advancement Rating
Our Rating:
D
Technological advancement compared to industry is -179.08% lower
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF DXP ENTERPRISES, INC.(DXPE) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND INDUSTRIAL DISTRIBUTION INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
26.7
One Month Price Target:
$27.
Six Month Price Target :
$28.52
Likely Price in One Year's Time:
Ticker:
$30.34
Likely Trading Range Today Under (Normal Volatility)
$26.53
Price Upper limit ($) :
$26.88
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$24.55
This week:
$21.89
This month :
$17.07
Other Primary facts
Market Cap:
504.53M
Market Cap Classification:
Small Cap
Number of Shares
IPO Date:
18.85M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
25.52%
-24.66%
Worst Daily Decline:
Our Options Trading Entry Points
Iron Condor entry points for options expiring in 1 week's time
Low risk (<2%) entry points
Buy Call:
Sell Call:
Buy Put:
Sell Put:
$36.69
$32.14
$16.71
$21.26
Medium risk (<10%) entry points
Buy Call
Sell Call
$30.66
Buy Put:
Sell Put:
$29.69
$22.73
$23.71
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
DXPE
Sharpe Ratio:
0.26%
Comparison:
DXPE, is amongst the top 40% stocks with lowest risk-adjusted returns
Sharpe ratio is -91.45% lower than the industry
& is -88.44% lower than the market/S&P 500 average
Average Returns/Yield of
DXPE
Daily returns:
0.02%
Weekly returns:
0.10%
Monthly returns:
0.38%
Yearly returns:
22.00%
Comparison of returns:
Average annual returns/yield (last 3 years) is -79.04% below industry average
Classification:
DXPE, is amongst the top 60% highest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.66
Statistical test of Returns:
DXPE has yielded returns statistically similar to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
3.94%
Weekly Volatility:
8.80%
Monthly Volatility:
17.60%
Yearly Volatility:
60.97%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
0.43%
Volatility in last five trading days has been -89.00% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-8.06%
Weekly VaR:
-18.03%
Monthly VaR:
-36.06%
How Much Can the price of
DXPE
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-32%
Worst case (decline):
>85%
This translates to price declining to:
$18.24
This translates to price declining to:
$4.01
Severe Crash Probability
Risk of crash in next 6/12 months: Low (<25%)
What is Value at Risk (VaR)?
Risk Fundamentals
DXPE is a 154.50% riskier investment compared to the market/S&P 500 & is 118.03% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is 44.48% above industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
DXPE
Beta in relation to market/S&P 500--2.03
Expected beta in 1 year's time:
1.022
Expected beta in 3 year's time:
1.446
Unlevered (debt free) Beta:
1.115
Beta in relation to Nasdaq (XNAS):
0.718
Beta in relation to all global stocks::
0.912
Beta Comparison & Analysis
Beta of competitors/peers::
1.42
Beta is 43.05% higher than peers
Average Industry Beta:
1.265
Beta is 60.58% above industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
3.87%
Sustainable growth rate is -77.05% below industry average
Alpha provided | Alpha Analysis
Alpha provided:
-0.125
Alpha is -222.31% below industry average alpha yield
Alpha is -793% below the market average
Analysis of Cost of Capital of
DXPE
Equity cost of capital:
0.171
Equity cost of capital is 44.43% above industry mean WACC
Unlevered (without debt) cost of capital:
9.36%
Before-tax cost of debt:
5.60%
After-tax cost of debt:
4.42%
Overall debt rating:
Lower BB medium grade (Fifth highest grade)
Weighted average cost of capital (WACC):
4.42%
WACC is 34.25% above industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$63.02
Revenue growth rate per share of (3Y):
1.4
Annual revenue growth rate is -217.59% below industry average
EPS:
$1.46
Expected Annual growth rate of EPS (3Y):
-30.01%
Expected future EPS growth rate is -233.95% lower than the Industrial Distribution industry
Free cash flow (FCF) per share:
$1.53
Balance sheet equity growth per share: -9.41%
Equity growth rate per share is -143.69% lower than the industry
Debt per share
$18.79
EBITDA per share
$4.38
Valuation Analysis Today of
DXPE
P/E Ratio:
16.09
P/E Ratio of Competitors/Peers:
432.53
P/E ratio is -96.28% lower than main peers & is -37.71% lower than the industry
Stock price/value with industry average P/E ratio: $37.71
DXPE is -29.19% undervalued if valued using industry average P/E ratio
-
-
P/S (Price to Sales ratio):
0.42
Price to sales ratio is -76.54% below the industry mean
P/B (Price to book value ratio):
1.4
Price to free cash flow: 17.50
-
Net income growth rate (3Y):
-58.29%
Net income growth rate is 182.27% higher than the average industry net income growth rate
Dividend Analysis
Dividend payout rate: 0.08%
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Dividend History:
--$0.00
--$0.00
--$0.00
--$0.00
--$0.00
--$0.00
-
In-depth Debt & Leverage Analysis
Debt to equity ratio:
98.30%
Net debt to equity ratio:
94.09%
Debt to assets ratio:
39.24%
Net debt to assets ratio:
37.56%
Debt-to-asset ratio is -9.39% below industry average
Ability to repay debt:
Interest coverage ratio:
3.93
Interest coverage ratio is -96.22% less than industry average
Looking forward:
Debt growth rate:
12.04%
Annual debt growth is -43% lower than industry average debt growth rate
Debt repayment rate in last quarter: 0.23%
Analysis of Key Statistics
Correlation of price movement with the market:
0.453
Statistical significance of correlation:
DXPE has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.554
Stock price is -18.15% less correlated with the market compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.554
Correlation of price movement with Nasdaq (^IXIC):
0.019
Covariance of price movement with the market:
0.044
Kurtosis
6.898
Returns have a significant fat-tails (leptokurtic), i.e., returns considerably higher or lower than the mean returns are more probable, compared to assets with normally distributed returns
Skewness of returns:
-0.133
Returns are, approximately, symmetrical
Fundamental Analysis & Dupont Analysis of
DXPE
Gross Profit Margin Ratio:
118%
Operating Profit Margin Ratio:
4.65%
Operating profit margin is -27.73% lower than the industry
Net Profit Margin Ratio:
118%
Effective Tax Rate:
16.32%
Effective tax rate is -18.13% lower than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
7.97%
Return on equity (ROE) is -69.17% lower than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
3.18%
Return on assets (ROA) is -67.87% lower than the industry
Financial Leverage:
1.6x
Current Ratio:
2.32
Current ratio is -6.97% below industry average
Cash Conversion Cycle (days):
49.3
Cash conversion cycle is 54.92% above industry average
The remaining useful life of property plant & equipment is: 7.3 years
Stock based compensation to net income ratio:
1.29%
In-depth Efficiency Analysis
Revenue generated per employee:
477.0K
Each employee generates -16% less revenue than industry average revenue per employee
EBITDA generated per employee:
33.1K
Each employee generates -48% less EBITDA than industry average revenue per employee
Profit generated per employee:
11.5K
Each employee generates -71% less net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
0.8K
Each employee generates -727% less free cash flow than industry average revenue per employee
Assets/Capital per employee
196.7K
Each employee generates -727% less free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
-
-
Competitors/Peer firms of
DXPE
UNIVERSAL LOGISTICS HOLDINGS, INC. (XNAS:ULH)
BARRETT BUSINESS SERVICES, INC. (XNAS:BBSI)
CONCRETE PUMPING HOLDINGS, INC. (XNAS:BBCP)
PYROGENESIS CANADA INC. (XNAS:PYR)
TPI COMPOSITES, INC. (XNAS:TPIC)
INFRASTRUCTURE AND ENERGY ALTERNATIVES, INC. (XNAS:IEA)
RADA ELECTRONIC INDUSTRIES LTD (XNAS:RADA)
BLADE AIR MOBILITY, INC. (XNAS:BLDE)
THCBW
Current Analyst Ratings
Strong buy�8%
Buy�0%
Hold�8%
Sell�0%
Strong sell�0%
Overall analyst sentiment is: Strong buy
Income Statement
Period:
TTM
Date:
3/31/22
Revenue:
1.19B
Cost of Revenue:
Gross Profit:
R&D Expense
General & Admin Expenses:
Selling, General & Admin Expenses
Sales and Marketing Expenses
Other Expenses :
Operating Expenses :
Cost & Expenses :
Interest Income:
Interest Expenses:
Depreciation & Amortization:
EBITDA:
Operating Income:
Other Income Expenses:
Income Before Tax:
Income Tax Expense:
Net Income:
Balance Sheet
Date:
Calendar Year:
Period:
Cash & Cash Equivalents:
Short Term Investments:
Cash & Short Term Investments:
Net Receivables:
Inventory:
Other Current Assets:
Total Current Assets:
PP&E:
Goodwill:
Intangible Assets:
Long Term Investments:
Tax Assets:
Other Non-Current Assets:
Total Non-Current Assets:
Other Assets:
Total Assets:
Accounts Payable:
Short Term Debt:
Tax Payables:
Deferred Revenue:
Other Current Liabilities:
Total Current Liabilities:
Long Term Debt:
Other Non-Current Liabilities:
Total Non Current Liabilities:
Other Liabilities:
Total Liabilities:
Common Stock:
Retained Earnings:
Accumulated Other Comprehensive Loss:
Other Total Stockholders' Equity:
Total Stockholders' Equity:
Total Liabilities and Stockholders' Equity:
Total Investments:
Total Debt:
Net Debt:
835.94M
351.78M
-
-
296.58M
-
-
296.58M
-
21.01M
27.27M
82.48M
55.18M
28.71M
33.64M
5.49M
28.71M
Statement of Cash Flow
Date:
Period:
6.75M
Differed Income Tax :
411.00K
Stock Based Compensation :
370.00K
Change in Working Capital :
- 18224.00K
Accounts Receivables:
-
Other Working Capital:
-
Other Non-Cash Items:
842.00K
Net Cash Provided by Operating Activities:
2.68M
Investments in PP&E:
- 740.00K
Net Acquisitions:
- 5316.00K
Purchases of Investments:
-
Sales/Maturities of Investments:
Other Investing Activities:
Net Cash Used for Investing Activities:
Debt Repayment:
Common Stock Issued:
Common Stock Repurchased:
Dividend Paid:
Other Financing Activities:
Net Cash Used Provided by Financing Activities:
Effect of FOREX on Changes in Cash:
Net Changes in Cash:
Cash at End of Period:
Cash at Beginning of Period:
Operating Cash Flow:
Capital Expenditure:
Free Cash Flow (FCF):
3/31/22
2022
Q1
36.56M
-
36.56M
249.74M
111.86M
14.41M
412.57M
106.54M
301.56M
77.01M
-
-
4.65M
489.75M
-
902.32M
81.45M
21.39M
104.00K
18.83M
56.31M
177.98M
354.08M
2.21M
364.21M
-
542.19M
195.00K
215.10M
- 27613.0K
172.49M
March 31, 2022 at 6:00:00 AM
1.13B
360.19M
902.38M
-
375.47M
338.9M
-
-
- 6056.00K
- 825.00K
-
- 8315.00K
- 23.00K
- 159.00K
- 9322.00K
268.00K
- 12430.00K
36.65M
49.08M
2.68M
- 740.00K
1.94M
Our Proprietary Portfolio Rating
Our Rating:
D
Price Forecast/Expected Price in Next 5 Years of
DXPE
2023
2024
2025
2026
2027
$30.49
$151.80
$172.52
$196.07
$222.84