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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
Navient Corporation (XNAS:NAVI) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
NAVI
Name:
NAVIENT CORPORATION (XNAS:NAVI)
Sector:
- 109.00K
Industry:
Credit Services
CEO:
Mr. John Remondi
Total Employees:
4,330
Our Technological Advancement Rating
Our Rating:
B
Technological advancement compared to industry is -32.45% lower
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF NAVIENT CORPORATION(NAVI) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND CREDIT SERVICES INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
14.7
One Month Price Target:
$14.84
Six Month Price Target :
$15.53
Likely Price in One Year's Time:
Ticker:
$16.35
Likely Trading Range Today Under (Normal Volatility)
$14.62
Price Upper limit ($) :
$14.8
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$13.63
This week:
$12.32
This month :
$9.93
Other Primary facts
Market Cap:
2.02B
Market Cap Classification:
Mid Cap
Number of Shares
IPO Date:
141.88M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
25.6%
-18.38%
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:
$19.64
$17.37
$9.76
$12.03
Medium risk (<10%) entry points
Buy Call
Sell Call
$16.63
Buy Put:
Sell Put:
$16.15
$12.76
$13.25
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
NAVI
Sharpe Ratio:
1.81%
Comparison:
NAVI, is amongst the top 40% stocks with highest risk-adjusted returns
Sharpe ratio is -2.68% lower than the industry
& is -20.62% lower than the market/S&P 500 average
Average Returns/Yield of
NAVI
Daily returns:
0.07%
Weekly returns:
0.37%
Monthly returns:
1.47%
Yearly returns:
19.06%
Comparison of returns:
Average annual returns/yield (last 3 years) is -7.66% below industry average
Classification:
NAVI, is amongst the top 40% highest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.79
Statistical test of Returns:
NAVI has not yielded statistically significant higher returns when compared to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
3.56%
Weekly Volatility:
7.97%
Monthly Volatility:
15.94%
Yearly Volatility:
55.23%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
1.78%
Volatility in last five trading days has been -50.20% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-7.25%
Weekly VaR:
-16.21%
Monthly VaR:
-32.42%
How Much Can the price of
NAVI
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-28%
Worst case (decline):
>85%
This translates to price declining to:
$10.61
This translates to price declining to:
$2.21
Severe Crash Probability
Risk of crash in next 6/12 months: Medium (<50%)
What is Value at Risk (VaR)?
Risk Fundamentals
NAVI is a 128.78% riskier investment compared to the market/S&P 500 & is 96.00% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is 8.03% above industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
NAVI
Beta in relation to market/S&P 500--1.67
Expected beta in 1 year's time:
1.314
Expected beta in 3 year's time:
1.859
Unlevered (debt free) Beta:
0.202
Beta in relation to Nasdaq (XNAS):
0.999
Beta in relation to all global stocks::
0.912
Beta Comparison & Analysis
Beta of competitors/peers::
0.948
Beta is 76.50% higher than peers
Average Industry Beta:
1.332
Beta is 25.58% above industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
22.95%
Sustainable growth rate is -31.97% below industry average
Alpha provided | Alpha Analysis
Alpha provided:
0.030
Alpha is -55.89% below industry average alpha yield
Alpha is 191% higher than market/& is unsustainably high
Analysis of Cost of Capital of
NAVI
Equity cost of capital:
0.146
Equity cost of capital is 19.02% above industry mean WACC
Unlevered (without debt) cost of capital:
1.76%
Before-tax cost of debt:
1.61%
After-tax cost of debt:
1.27%
Overall debt rating:
Highest AAA investment grade
Weighted average cost of capital (WACC):
1.27%
WACC is -76.93% below industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$13.41
Revenue growth rate per share of (3Y):
0.74
Annual revenue growth rate is -44.97% below industry average
EPS:
$3.68
Expected Annual growth rate of EPS (3Y):
17.20%
Expected future EPS growth rate is -31.34% lower than the Credit Services industry
Free cash flow (FCF) per share:
$3.25
Balance sheet equity growth per share: 6.69%
Equity growth rate per share is -71.89% lower than the industry
Debt per share
$499.19
EBITDA per share
$12.91
Valuation Analysis Today of
NAVI
P/E Ratio:
3.81
P/E Ratio of Competitors/Peers:
16.43
P/E ratio is -76.81% lower than main peers & is -68.60% lower than the industry
Stock price/value with industry average P/E ratio: $44.67
NAVI is -67.09% undervalued if valued using industry average P/E ratio
Share value as per dividend discount (DDM) model: $19.30
Present value of the expected future dividends only: $4.38
P/S (Price to Sales ratio):
1.1
Price to sales ratio is -78.92% below the industry mean
P/B (Price to book value ratio):
0.74
Price to free cash flow: 4.52
Price to free cash flow ratio is -89.40% lower than the industry
Net income growth rate (3Y):
200.45%
Net income growth rate is 1141.05% higher than the average industry net income growth rate
Dividend Analysis
Dividend payout rate: 0.00%
Dividend yeild: 4.35%
Previous Dividend: $0.16
Previous adjusted dividend: $0.16
Previous Dividend: $0.64
-
-
Average dividend payment (long-term): $0.16
Average dividend increase/decrease (growth rate) % per period: 0.00%
Expected next dividend payment date: 15/09/2022
Expected next dividend record date: 09/01/2022
-
Previous dividend payment date: 17/06/2022
Previous dividend record date: 06/03/2022
-
Dividend History:
2022-06-02--$0.16
2021-12-02--$0.16
2021-06-03--$0.16
2022-03-03--$0.16
2021-09-02--$0.16
2021-03-04--$0.16
-
In-depth Debt & Leverage Analysis
Debt to equity ratio:
950.16%
Net debt to equity ratio:
991.67%
Debt to assets ratio:
90.62%
Net debt to assets ratio:
94.58%
Debt-to-asset ratio is 16.24% above industry average
Ability to repay debt:
Interest coverage ratio:
1.52
Interest coverage ratio is -84.48% less than industry average
Looking forward:
Debt growth rate:
-8.00%
Annual debt growth is -116% lower than industry average debt growth rate
Debt repayment rate in last quarter: 0.00%
Analysis of Key Statistics
Correlation of price movement with the market:
0.597
Statistical significance of correlation:
NAVI has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.561
Stock price is 6.51% more correlated with the market, compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.561
Correlation of price movement with Nasdaq (^IXIC):
0.039
Covariance of price movement with the market:
0.08
Kurtosis
7.871
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:
0.124
Returns are, approximately, symmetrical
Fundamental Analysis & Dupont Analysis of
NAVI
Gross Profit Margin Ratio:
-
Operating Profit Margin Ratio:
0.00%
-
Net Profit Margin Ratio:
-
Effective Tax Rate:
23.24%
Effective tax rate is 7.35% higher than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
6.59%
Return on equity (ROE) is -84.46% lower than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
0.63%
Return on assets (ROA) is -89.63% lower than the industry
Financial Leverage:
10.7x
Current Ratio:
0.24
Current ratio is -95.82% below industry average
Cash Conversion Cycle (days):
0
-
The remaining useful life of property plant & equipment is: 1.4 years
Stock based compensation to net income ratio:
0.00%
In-depth Efficiency Analysis
Revenue generated per employee:
439.5K
Each employee generates -39% less revenue than industry average revenue per employee
EBITDA generated per employee:
422.9K
Each employee generates 1% more EBITDA than industry average revenue per employee
Profit generated per employee:
113.4K
Each employee generates -53% less net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
0.0K
Each employee generates -100% less free cash flow than industry average revenue per employee
Assets/Capital per employee
166.7K
Each employee generates -100% less free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
-
-
Competitors/Peer firms of
NAVI
FIRSTCASH HOLDINGS, INC. (XNAS:FCFS)
VALLEY NATIONAL BANCORP (XNAS:VLYPP)
CATHAY GENERAL BANCORP (XNAS:CATY)
ENACT HOLDINGS, INC. (XNAS:ACT)
HAMILTON LANE INCORPORATED (XNAS:HLNE)
SIMMONS FIRST NATIONAL CORPORATION (XNAS:SFNC)
FOCUS FINANCIAL PARTNERS INC. (XNAS:FOCS)
AGCUU
BULL HORN HOLDINGS UNT (XNAS:BHSEU)
Current Analyst Ratings
Strong buy�4%
Buy�13%
Hold�21%
Sell�0%
Strong sell�0%
Overall analyst sentiment is: Hold
Income Statement
Period:
TTM
Date:
3/31/22
Revenue:
1.90B
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:
-
-
-
419.00M
419.00M
-
63.00M
63.00M
2.32B
1.20B
4.00K
1.83B
-
491.00M
598.00M
139.00M
491.00M
Statement of Cash Flow
Date:
Period:
4.00K
Differed Income Tax :
-
Stock Based Compensation :
9.00K
Change in Working Capital :
908.00M
Accounts Receivables:
-
Other Working Capital:
- 2884000.00K
Other Non-Cash Items:
- 1052122.00K
Net Cash Provided by Operating Activities:
- 109.00K
Investments in PP&E:
-
Net Acquisitions:
-
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
708.00M
210.00M
918.00M
-
-
-
918.00M
-
-
-
-
-
-
722.00M
77.96B
78.16B
-
3.80B
-
-
-
3.80B
70.83B
701.00M
71.53B
-
75.33B
4.00M
4.17B
- 19000.0K
3.30B
March 31, 2022 at 6:00:00 AM
63.00M
7.45B
82.78B
210.00M
74.63B
73.9B
-
1.75M
1.75M
-
-
- 115.00K
- 24.00K
- 1867.00K
- 2006.00K
-
- 364.00K
3.21M
3.58M
- 109.00K
-
- 109.00K
Our Proprietary Portfolio Rating
Our Rating:
D
Price Forecast/Expected Price in Next 5 Years of
NAVI
2023
2024
2025
2026
2027
$16.43
$35.65
$39.66
$44.11
$49.07