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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
Service Corporation International (XNYS:SCI) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
SCI
Name:
SERVICE CORPORATION INTERNATIONAL (XNYS:SCI)
Sector:
275.43M
Industry:
Personal Services
CEO:
Mr. Thomas Ryan
Total Employees:
17,022
Our Technological Advancement Rating
Our Rating:
D
Technological advancement compared to industry is -105.26% lower
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF SERVICE CORPORATION INTERNATIONAL(SCI) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND PERSONAL SERVICES INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
61.58
One Month Price Target:
$61.84
Six Month Price Target :
$63.15
Likely Price in One Year's Time:
Ticker:
$64.72
Likely Trading Range Today Under (Normal Volatility)
$61.4
Price Upper limit ($) :
$61.84
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$58.98
This week:
$55.76
This month :
$49.94
Other Primary facts
Market Cap:
9.71B
Market Cap Classification:
Mid Cap
Number of Shares
IPO Date:
157.68M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
11.89%
-12.84%
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:
$73.65
$68.07
$49.51
$55.09
Medium risk (<10%) entry points
Buy Call
Sell Call
$66.25
Buy Put:
Sell Put:
$65.06
$56.89
$58.10
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
SCI
Sharpe Ratio:
2.77%
Comparison:
SCI, is amongst the top 40% stocks with highest risk-adjusted returns
Sharpe ratio is 874.56% higher than the industry
& ratio is 21.63% higher than the market/S&P 500 average
Average Returns/Yield of
SCI
Daily returns:
0.07%
Weekly returns:
0.33%
Monthly returns:
1.34%
Yearly returns:
0.17%
Comparison of returns:
Average annual returns/yield (last 3 years) is 9255.27% above industry average
Classification:
SCI, is amongst the top 40% highest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.68
Statistical test of Returns:
SCI has yielded returns statistically similar to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
2.09%
Weekly Volatility:
4.67%
Monthly Volatility:
9.35%
Yearly Volatility:
32.39%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
0.77%
Volatility in last five trading days has been -63.06% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-4.23%
Weekly VaR:
-9.45%
Monthly VaR:
-18.90%
How Much Can the price of
SCI
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-16%
Worst case (decline):
-65.48%
This translates to price declining to:
$51.76
This translates to price declining to:
$21.26
Severe Crash Probability
Risk of crash in next 6/12 months: High (50-70%)
What is Value at Risk (VaR)?
Risk Fundamentals
SCI is a 33.41% riskier investment compared to the market/S&P 500 & is 14.29% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is -26.11% below industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
SCI
Beta in relation to market/S&P 500--0.76
Expected beta in 1 year's time:
0.678
Expected beta in 3 year's time:
0.958
Unlevered (debt free) Beta:
0.287
Beta in relation to Nasdaq (XNAS):
0.603
Beta in relation to all global stocks::
0.629
Beta Comparison & Analysis
Beta of competitors/peers::
1.822
Beta is -58.35% lower than peers
Average Industry Beta:
0.861
Beta is -11.88% below industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
34.42%
Sustainable growth rate is 72.40% above industry average
Alpha provided | Alpha Analysis
Alpha provided:
0.077
Alpha is -186.55% below industry average alpha yield
Alpha is 489% higher than market/& is unsustainably high
Analysis of Cost of Capital of
SCI
Equity cost of capital:
0.083
Equity cost of capital is -7.75% below industry mean WACC
Unlevered (without debt) cost of capital:
3.15%
Before-tax cost of debt:
3.82%
After-tax cost of debt:
3.02%
Overall debt rating:
Lower BB medium grade (Fifth highest grade)
Weighted average cost of capital (WACC):
3.02%
WACC is 21.74% above industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$26.49
Revenue growth rate per share of (3Y):
5.27
Annual revenue growth rate is 149.55% above the industry average
EPS:
$4.73
Expected Annual growth rate of EPS (3Y):
32.48%
Expected future EPS growth rate is 15826.64% higher than the Personal Services industry
Free cash flow (FCF) per share:
$3.90
Balance sheet equity growth per share: 29.18%
Equity growth rate per share is -892.75% lower than the industry
Debt per share
$25.13
EBITDA per share
$9.29
Valuation Analysis Today of
SCI
P/E Ratio:
13.3
P/E Ratio of Competitors/Peers:
16.13
P/E ratio is -17.59% lower than main peers & is -67.85% lower than the industry
Stock price/value with industry average P/E ratio: $195.64
SCI is -68.52% undervalued if valued using industry average P/E ratio
Share value as per dividend discount (DDM) model: $48.09
Present value of the expected future dividends only: $20.18
P/S (Price to Sales ratio):
2.32
Price to sales ratio is -33.83% below the industry mean
P/B (Price to book value ratio):
5.27
Price to free cash flow: 15.79
-
Net income growth rate (3Y):
95.52%
Net income growth rate is -130.85% lower than the industry average net income growth rate
Dividend Analysis
Dividend payout rate: 5.04%
Dividend yeild: 1.56%
Previous Dividend: $0.25
Previous adjusted dividend: $0.25
Previous Dividend: $0.96
Expected next dividend best case: $0.27
Expected next dividend worst case: $0.23
Average dividend payment (long-term): $0.21
Average dividend increase/decrease (growth rate) % per period: 3.43%
Expected next dividend payment date: 28/09/2022
Expected next dividend record date: 13/09/2022
-
Previous dividend payment date: 30/06/2022
Previous dividend record date: 15/06/2022
-
Dividend History:
2022-06-14--$0.25
2021-12-14--$0.23
2021-06-14--$0.21
2022-03-14--$0.25
2021-09-14--$0.23
2021-03-12--$0.21
Dividend growth rate is 110.59% higher than the average industry
In-depth Debt & Leverage Analysis
Debt to equity ratio:
215.06%
Net debt to equity ratio:
202.21%
Debt to assets ratio:
25.64%
Net debt to assets ratio:
24.11%
Debt-to-asset ratio is -68.83% below industry average
Ability to repay debt:
Interest coverage ratio:
9.53
Interest coverage ratio is -86.52% less than industry average
Looking forward:
Debt growth rate:
5.99%
Annual debt growth is 45% higher than industry average debt growth rate
Debt repayment rate in last quarter: 0.46%
Analysis of Key Statistics
Correlation of price movement with the market:
0.611
Statistical significance of correlation:
SCI has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.482
Stock price is 26.79% more correlated with the market, compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.482
Correlation of price movement with Nasdaq (^IXIC):
0.048
Covariance of price movement with the market:
0.058
Kurtosis
7.739
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:
-0.295
Returns are, approximately, symmetrical
Fundamental Analysis & Dupont Analysis of
SCI
Gross Profit Margin Ratio:
124%
Operating Profit Margin Ratio:
28.35%
Operating profit margin is 149.65% higher than the industry
Net Profit Margin Ratio:
124%
Effective Tax Rate:
23.35%
Effective tax rate is -2.11% lower than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
43.06%
Return on equity (ROE) is -125.89% lower than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
5.13%
Return on assets (ROA) is -33.96% lower than the industry
Financial Leverage:
1.3x
Current Ratio:
0.59
Current ratio is -41.90% below industry average
Cash Conversion Cycle (days):
10.2
Cash conversion cycle is -46.79% below industry average
The remaining useful life of property plant & equipment is: 2.6 years
Stock based compensation to net income ratio:
0.46%
In-depth Efficiency Analysis
Revenue generated per employee:
245.4K
Each employee generates -39% less revenue than industry average revenue per employee
EBITDA generated per employee:
86.1K
Each employee generates -18% less EBITDA than industry average revenue per employee
Profit generated per employee:
46.6K
Each employee generates -33% less net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
16.2K
Each employee generates -42% less free cash flow than industry average revenue per employee
Assets/Capital per employee
881.1K
Each employee generates -42% less free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
-
-
Competitors/Peer firms of
SCI
FARFETCH LIMITED (XNYS:FTCH)
TAPESTRY, INC. (XNYS:TPR)
WILLIAMS-SONOMA, INC. (XNYS:WSM)
LEAR CORPORATION (XNYS:LEA)
RH (XNYS:RH)
On Holding Ltd (XNYS:ONON)
BORGWARNER INC. (XNYS:BWA)
Berry Global Group, Inc. (XNYS:BERY)
-
Current Analyst Ratings
Strong buy�13%
Buy�8%
Hold�0%
Sell�0%
Strong sell�0%
Overall analyst sentiment is: Strong buy
Income Statement
Period:
TTM
Date:
3/31/22
Revenue:
4.18B
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:
2.87B
1.30B
-
143.08M
143.08M
-
-
143.08M
-
153.83M
276.01M
1.47B
1.18B
793.57M
1.04B
241.87M
793.57M
Statement of Cash Flow
Date:
Period:
72.36M
Differed Income Tax :
- 4580.00K
Stock Based Compensation :
3.69M
Change in Working Capital :
36.91M
Accounts Receivables:
5.44M
Other Working Capital:
73.82M
Other Non-Cash Items:
4.23M
Net Cash Provided by Operating Activities:
332.17M
Investments in PP&E:
-
Net Acquisitions:
2.99M
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
300.56M
-
300.56M
103.03M
28.65M
26.49M
458.73M
4.15B
1.92B
-
6.47B
-
2.46B
15.00B
-
15.46B
645.13M
63.86M
66.22M
-
66.22M
775.21M
3.96B
2.30B
12.84B
-
13.61B
159.16M
678.93M
47.5M
-
March 31, 2022 at 6:00:00 AM
3.02B
1.84B
15.46B
-
4.03B
3.7B
-
- 58640.00K
- 55654.00K
- 18134.00K
-
- 256355.00K
- 39964.00K
62.76M
- 251698.00K
2.56M
27.38M
305.93M
278.56M
332.17M
- 56748.00K
275.43M
Our Proprietary Portfolio Rating
Our Rating:
D
Price Forecast/Expected Price in Next 5 Years of
SCI
2023
2024
2025
2026
2027
$65.04
$90.97
$95.61
$100.49
$105.61