Volt Information Sciences (VOLT) Company Overview & Stock Price Forecast
This article provides a brief analysis and stock rating for Volt Information Sciences (VOLT) including an updated stock price target after the company’s upgrade to a ‘Strong Buy‘ rating by Zacks Equity Research. This upgrade echoes the SIS Research Group sentiment about the company as well. Below we provide updated data on the company’s earnings yield, price/earnings ratio, return on invested capital and YTD performance.
Volt Information Sciences Fundamentals
Stock Price Target: $7.43
In the section below, we discuss the earnings yield, P/E, return on invested capital and YTD performance for Volt Information Sciences in comparison to the Business Services industry and the S&P 500.
Volt Information Sciences is a Micro Cap company with a Market Cap of $78.6M.
How are investors using Volt Information Sciences earnings yield to assess the company?
The earnings yield is used to show the percentage of a company’s earnings per share. Investors typically use earnings yield to determine which assets are underpriced or overpriced relative to other variables, like sector, industry or bond yields. Simply put, the earnings yield of a company can be used to assess how expensive a company is in relation to the earnings that are generated. When valuing companies, the SIS Research Group does not utilize the inverse P/E ratio to calculate the earnings yield. Instead, we use an adjusted earning yield calculation to capture variation amongst companies (i.e. debt and tax rates).
The current earnings yield for Volt Information Sciences is 21.27%%, in comparison to 3.49% for the S&P 500 and 1.66% for the 10-year treasury bond. The median earnings yield for the Business Services industry is 2.80%.
What does Volt Information Sciences Price-to-Earnings Ratio (P/E) tell investors about the company?
The price-to-earnings ratio (P/E) is a relatively popular metric used by investors and analysts for valuing a company’s stock. The P/E ratio can be used to show how a stock’s valuation compares to other companies and the total market. Investors use the P/E ratio to determine what the market is willing to pay today based on a company’s past or future earnings. A high P/E ratio could mean that a stock’s price is too high relative to earnings, which could be a signal that a stock is currently overvalued. In turn, a low P/E ratio could indicate that a company’s current stock price is low relative to earnings.
Volt Information Sciences does not currently have a reported P/E ratio. The P/E for the Business Services industry is 35.60 and the P/E for the S&P 500 is 28.63.
What is the current Price-to-Sales Ratio (P/S) for Volt Information Sciences?
The Price-to-Sales Ratio (P/S) looks at a company’s market cap and revenue to determine valuation. The P/S ratio is calculated by taking a company’s market cap and dividing by the total sales or revenue. The P/S ratio gives an idea of how much the market values every dollar of a company’s sales and can be effective in valuing unprofitable growth stocks or companies that are currently undergoing special situations or challenges. A lower the P/S ratio can be an indicator of good value.
Volt Information Sciences is currently trading at a P/S of 0.08. The P/S for the Business Services industry is 2.51 and the P/S for the S&P 500 is 3.11.
How does Volt Information Sciences Price-to-Book Ratio (P/B) compare to the Business Services industry?
Price-to-book value (P/B) is the ratio of the market value of a company’s shares divided by its book value of equity (the value of it’s assets on the books). The book value is the difference between the book value of assets and liabilities. Typically, investors use the P/B ratio to assess if a stock is valued properly (a value of one means that the stock price is trading in line with the book value of the company). A company with a high P/B ratio could mean the stock price is overvalued as well as the converse.
Volt Information Sciences P/B ratio is 2.58. The P/B for the Business Services industry is 5.85 and the P/B for the S&P 500 is 4.84.
How attractive is Volt Information Sciences Return on Invested Capital (ROIC) to investors?
Investors use the return on invested capital (ROIC) to assess how efficient a company is at turning capital into profits. The ROIC is the amount of money a company makes on it’s investments that is above the average cost of debt and equity.
Investors can use the ROIC to provide context for metrics like the (P/E) ratio. For instance, when used in isolation a low P/E ratio could suggest a company is oversold but the decline could be because a company is no longer generating value for shareholders. Conversely, companies that consistently generate high rates of ROIC can plausibly trade at a premium compared to other stocks, even if their P/E ratios are high.
Volt Information Sciences ROIC is currently -9.50% in comparison to 12.08% for the Business Services industry and 8.60% for the S&P 500.
What is VOLT stock YTD Performance in comparison to its industry and the total market?
The year-to-date (YTD) performance is the amount of profit/loss realized by a stock since the first trading day of the current calendar year.
The YTD performance for Volt Information Sciences is 97.74%. The Business industry has a YTD performance of 23.01% in comparison to the YTD S&P 500 performance of 21.19%.
Recent Financial Results
- Revenue reported of $217.5M, a 17.0% increase compared to Q3 2020
- Gross margin increased YoY by 16.6% in Q3 2021
- GAAP operating income reported of $1.6M, a $5.8M increase YoY
- GAAP EPS reported of $0.03 per diluted share compared to a loss of ($0.22) per share in prior year quarter
- EBITDA of $24.1M
Stock Price Target: $7.43
Volt Information Sciences is a global provider of staffing services (traditional time, materials-based and project-based). The company’s staffing services consist of workforce solutions (i.e. providing contingent workers), personnel recruitment services and managed staffing services programs.
The company provides staffing solutions to the following employment sectors: administrative, light industrial commercial services, information technology and engineering. Volt’s managed service programs involve managing the procurement and on-boarding of contingent workers from multiple providers.
Volt operates in approximately 60 locations and has an on-site presence in over 50 customer locations. Approximately 88% of the company’s revenue is generated in the US but their principal international markets include Europe, Asia Pacific and Canada. As of May 2021, the company employed approximately 14,200 people, including 13,100 who were on contingent staffing assignments with outside clients.
The company is headquartered in New York, NY and it’s current CEO is Linda Perneau. In June 2021, Volt was named by Forbes as both a Best Temporary Staffing Firm and Best Professional Recruitment Firm.
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This material is provided for informational purposes only and is not financial advice. The information contained herein should not solely be used for the formation of an investment decision, whether you are a long term or short term investor.