Valvoline Inc. Common Stock (VVV)

FairStock Score: 24/100 — RISKY

Key Financials

Strengths

• High return on equity of 33.0% demonstrating efficient capital deployment
• Established organization with 10,600 employees providing operational scale

Concerns

• Trades significantly above Graham Number ($6) with negative 426% margin of safety—limited downside protection
• High leverage at 6.63x debt-to-equity increases financial risk and interest expense burden
• Currently unprofitable—sustained losses could lead to dilutive capital raises or balance sheet deterioration
• Weak Piotroski F-Score of 2/9 suggests deteriorating financial quality across multiple dimensions

AI Analysis

Valvoline Inc. Common Stock is a small-cap consumer cyclical company valued at $4.1 billion. Revenue stands at $1.8 billion, though the company is currently unprofitable. From a quality standpoint, Valvoline shows weak Piotroski F-Score of 2/9 signaling deteriorating fundamentals and distressed Altman Z-Score of 1.0 warrants caution. On valuation, the stock is commanding a steep 46.9x multiple, with trades far above its Graham Number ($6) with no margin of safety. Growth dynamics show revenue growing at 11.5% and profit growth of -135.8%. Our composite FairStock Score of 24/100 reflects below-average fundamentals overall. Without profitability, this remains speculative—suitable only for those with high risk tolerance and a long time horizon.

Bull Case

Improving fundamentals and sector tailwinds could drive meaningful earnings growth, compressing the effective multiple for patient investors. Operational leverage in the business model means incremental revenue growth could disproportionately boost bottom-line profitability.

Bear Case

At 47x earnings, any growth disappointment triggers rapid multiple compression—a 20% earnings miss plus multiple contraction to 20x implies 40%+ downside. Regulatory changes, input cost inflation, or demand normalization represent underappreciated risks that could materially impact forward estimates.

Data from SEC filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer