Enerplus Corporation (ERF.CA) Stock Fundamental Analysis
TSX:ERF - Toronto Stock Exchange - CA2927661025 - Common Stock - Currency: CAD
ERF gets a fundamental rating of 7 out of 10. The analysis compared the fundamentals against 209 industry peers in the Oil, Gas & Consumable Fuels industry. ERF gets an excellent profitability rating and is at the same time showing great financial health properties. ERF is valued quite cheap, but it does not seem to be growing. With these ratings, ERF could be worth investigating further for value investing!.
1. Profitability
1.1 Basic Checks
In the past year ERF was profitable.
ERF had a positive operating cash flow in the past year.
The reported net income has been mixed in the past 5 years: ERF reported negative net income in multiple years.
Each year in the past 5 years ERF had a positive operating cash flow.
1.2 Ratios
ERF's Return On Assets of 18.87% is amongst the best of the industry. ERF outperforms 96.65% of its industry peers.
ERF's Return On Equity of 30.88% is amongst the best of the industry. ERF outperforms 97.13% of its industry peers.
With an excellent Return On Invested Capital value of 23.71%, ERF belongs to the best of the industry, outperforming 99.04% of the companies in the same industry.
ERF had an Average Return On Invested Capital over the past 3 years of 44.47%. This is significantly above the industry average of 7.47%.
The last Return On Invested Capital (23.71%) for ERF is well below the 3 year average (44.47%), which needs to be investigated, but indicates that ERF had better years and this may not be a problem.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 18.87% | ||
| ROE | 30.88% | ||
| ROIC | 23.71% |
ROA(3y)27%
ROA(5y)1.58%
ROE(3y)53.52%
ROE(5y)-5.89%
ROIC(3y)44.47%
ROIC(5y)N/A
1.3 Margins
With an excellent Profit Margin value of 23.87%, ERF belongs to the best of the industry, outperforming 90.43% of the companies in the same industry.
In the last couple of years the Profit Margin of ERF has remained more or less at the same level.
ERF has a Operating Margin of 29.94%. This is amongst the best in the industry. ERF outperforms 85.17% of its industry peers.
In the last couple of years the Operating Margin of ERF has declined.
ERF has a better Gross Margin (66.55%) than 77.03% of its industry peers.
ERF's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 29.94% | ||
| PM (TTM) | 23.87% | ||
| GM | 66.55% |
OM growth 3YN/A
OM growth 5Y-1.73%
PM growth 3YN/A
PM growth 5Y-1.29%
GM growth 3Y13.58%
GM growth 5Y-1.2%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), ERF is creating value.
The number of shares outstanding for ERF has been reduced compared to 1 year ago.
The number of shares outstanding for ERF has been reduced compared to 5 years ago.
The debt/assets ratio for ERF has been reduced compared to a year ago.
2.2 Solvency
An Altman-Z score of 3.71 indicates that ERF is not in any danger for bankruptcy at the moment.
ERF has a Altman-Z score of 3.71. This is amongst the best in the industry. ERF outperforms 80.86% of its industry peers.
ERF has a debt to FCF ratio of 0.66. This is a very positive value and a sign of high solvency as it would only need 0.66 years to pay back of all of its debts.
With an excellent Debt to FCF ratio value of 0.66, ERF belongs to the best of the industry, outperforming 93.30% of the companies in the same industry.
A Debt/Equity ratio of 0.08 indicates that ERF is not too dependend on debt financing.
Looking at the Debt to Equity ratio, with a value of 0.08, ERF is in the better half of the industry, outperforming 69.86% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.08 | ||
| Debt/FCF | 0.66 | ||
| Altman-Z | 3.71 |
ROIC/WACC2.89
WACC8.2%
2.3 Liquidity
ERF has a Current Ratio of 0.70. This is a bad value and indicates that ERF is not financially healthy enough and could expect problems in meeting its short term obligations.
ERF has a Current ratio (0.70) which is in line with its industry peers.
ERF has a Quick Ratio of 0.70. This is a bad value and indicates that ERF is not financially healthy enough and could expect problems in meeting its short term obligations.
ERF has a Quick ratio (0.70) which is in line with its industry peers.
The current and quick ratio evaluation for ERF is rather negative, while it does have excellent solvency and profitability. These ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.7 | ||
| Quick Ratio | 0.7 |
3. Growth
3.1 Past
ERF shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -52.71%.
ERF shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 6.39% yearly.
The Revenue for ERF has decreased by -28.47% in the past year. This is quite bad
Measured over the past years, ERF shows a small growth in Revenue. The Revenue has been growing by 5.17% on average per year.
EPS 1Y (TTM)-52.71%
EPS 3YN/A
EPS 5Y6.39%
EPS Q2Q%-48.37%
Revenue 1Y (TTM)-28.47%
Revenue growth 3Y31.15%
Revenue growth 5Y5.17%
Sales Q2Q%-12.38%
3.2 Future
ERF is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 19.13% yearly.
The Revenue is expected to grow by 4.12% on average over the next years.
EPS Next Y28.69%
EPS Next 2Y19.13%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue Next Year2.01%
Revenue Next 2Y5.71%
Revenue Next 3YN/A
Revenue Next 5Y4.12%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 10.80, the valuation of ERF can be described as very reasonable.
The rest of the industry has a similar Price/Earnings ratio as ERF.
ERF is valuated cheaply when we compare the Price/Earnings ratio to 26.31, which is the current average of the S&P500 Index.
The Price/Forward Earnings ratio is 6.53, which indicates a rather cheap valuation of ERF.
Based on the Price/Forward Earnings ratio, ERF is valued a bit cheaper than 67.94% of the companies in the same industry.
ERF's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 22.13.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 10.8 | ||
| Fwd PE | 6.53 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, ERF is valued a bit cheaper than 77.99% of the companies in the same industry.
65.07% of the companies in the same industry are more expensive than ERF, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 15.13 | ||
| EV/EBITDA | 4.76 |
4.3 Compensation for Growth
The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
ERF has an outstanding profitability rating, which may justify a higher PE ratio.
ERF's earnings are expected to grow with 19.13% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.38
PEG (5Y)1.69
EPS Next 2Y19.13%
EPS Next 3YN/A
5. Dividend
5.1 Amount
ERF has a Yearly Dividend Yield of 1.21%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 6.43, ERF has a dividend in line with its industry peers.
With a Dividend Yield of 1.21, ERF pays less dividend than the S&P500 average, which is at 2.40.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.21% |
5.2 History
On average, the dividend of ERF grows each year by 13.74%, which is quite nice.
ERF has been paying a dividend for at least 10 years, so it has a reliable track record.
ERF has not decreased its dividend in the past 5 years, so it has a somewhat stable track record.
Dividend Growth(5Y)13.74%
Div Incr Years4
Div Non Decr Years7
5.3 Sustainability
ERF pays out 12.97% of its income as dividend. This is a sustainable payout ratio.
The dividend of ERF is growing, but earnings are growing more, so the dividend growth is sustainable.
DP12.97%
EPS Next 2Y19.13%
EPS Next 3YN/A
TSX:ERF (6/3/2024, 7:00:00 PM)
26.78
-0.93 (-3.36%)
Chartmill FA Rating
GICS SectorEnergy
GICS IndustryGroupEnergy
GICS IndustryOil, Gas & Consumable Fuels
Earnings (Last)
Earnings (Next)
Inst Owners25.24%
Inst Owner ChangeN/A
Ins OwnersN/A
Ins Owner ChangeN/A
Market Cap5.47B
Analysts75
Price Target26.18 (-2.24%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.21% |
Yearly Dividend0.23
Dividend Growth(5Y)13.74%
DP12.97%
Div Incr Years4
Div Non Decr Years7
Ex-DateN/A
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-0.85%
Min EPS beat(2)-8.69%
Max EPS beat(2)6.99%
EPS beat(4)2
Avg EPS beat(4)-5.84%
Min EPS beat(4)-29.95%
Max EPS beat(4)8.31%
EPS beat(8)5
Avg EPS beat(8)16.37%
EPS beat(12)6
Avg EPS beat(12)-7.94%
EPS beat(16)6
Avg EPS beat(16)-240.98%
Revenue beat(2)N/A
Avg Revenue beat(2)N/A
Min Revenue beat(2)N/A
Max Revenue beat(2)N/A
Revenue beat(4)N/A
Avg Revenue beat(4)N/A
Min Revenue beat(4)N/A
Max Revenue beat(4)N/A
Revenue beat(8)N/A
Avg Revenue beat(8)N/A
Revenue beat(12)N/A
Avg Revenue beat(12)N/A
Revenue beat(16)N/A
Avg Revenue beat(16)N/A
PT rev (1m)0.45%
PT rev (3m)7.67%
EPS NQ rev (1m)-9.47%
EPS NQ rev (3m)10%
EPS NY rev (1m)-10.66%
EPS NY rev (3m)-8.24%
Revenue NQ rev (1m)N/A
Revenue NQ rev (3m)N/A
Revenue NY rev (1m)0%
Revenue NY rev (3m)0%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 10.8 | ||
| Fwd PE | 6.53 | ||
| P/S | 2.47 | ||
| P/FCF | 15.13 | ||
| P/OCF | 4.82 | ||
| P/B | 3.19 | ||
| P/tB | 3.19 | ||
| EV/EBITDA | 4.76 |
EPS(TTM)2.48
EY9.26%
EPS(NY)4.1
Fwd EY15.31%
FCF(TTM)1.77
FCFY6.61%
OCF(TTM)5.56
OCFY20.77%
SpS10.86
BVpS8.39
TBVpS8.39
PEG (NY)0.38
PEG (5Y)1.69
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 18.87% | ||
| ROE | 30.88% | ||
| ROCE | 30.38% | ||
| ROIC | 23.71% | ||
| ROICexc | 24.22% | ||
| ROICexgc | 24.22% | ||
| OM | 29.94% | ||
| PM (TTM) | 23.87% | ||
| GM | 66.55% | ||
| FCFM | 16.3% |
ROA(3y)27%
ROA(5y)1.58%
ROE(3y)53.52%
ROE(5y)-5.89%
ROIC(3y)44.47%
ROIC(5y)N/A
ROICexc(3y)46.07%
ROICexc(5y)N/A
ROICexgc(3y)46.07%
ROICexgc(5y)N/A
ROCE(3y)56.98%
ROCE(5y)N/A
ROICexcg growth 3YN/A
ROICexcg growth 5Y6.21%
ROICexc growth 3YN/A
ROICexc growth 5Y13.19%
OM growth 3YN/A
OM growth 5Y-1.73%
PM growth 3YN/A
PM growth 5Y-1.29%
GM growth 3Y13.58%
GM growth 5Y-1.2%
F-Score5
Asset Turnover0.79
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.08 | ||
| Debt/FCF | 0.66 | ||
| Debt/EBITDA | 0.11 | ||
| Cap/Depr | 146.97% | ||
| Cap/Sales | 34.91% | ||
| Interest Coverage | 29 | ||
| Cash Conversion | 95.37% | ||
| Profit Quality | 68.29% | ||
| Current Ratio | 0.7 | ||
| Quick Ratio | 0.7 | ||
| Altman-Z | 3.71 |
F-Score5
WACC8.2%
ROIC/WACC2.89
Cap/Depr(3y)132.01%
Cap/Depr(5y)138.02%
Cap/Sales(3y)23.79%
Cap/Sales(5y)33.65%
Profit Quality(3y)100.55%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-52.71%
EPS 3YN/A
EPS 5Y6.39%
EPS Q2Q%-48.37%
EPS Next Y28.69%
EPS Next 2Y19.13%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue 1Y (TTM)-28.47%
Revenue growth 3Y31.15%
Revenue growth 5Y5.17%
Sales Q2Q%-12.38%
Revenue Next Year2.01%
Revenue Next 2Y5.71%
Revenue Next 3YN/A
Revenue Next 5Y4.12%
EBIT growth 1Y-58.92%
EBIT growth 3YN/A
EBIT growth 5Y3.35%
EBIT Next Year86.17%
EBIT Next 3Y38.47%
EBIT Next 5YN/A
FCF growth 1Y-43%
FCF growth 3Y55.34%
FCF growth 5Y27.23%
OCF growth 1Y8.09%
OCF growth 3Y28.09%
OCF growth 5Y4.89%