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 210 industry peers in the Oil, Gas & Consumable Fuels industry. ERF scores excellent points on both the profitability and health parts. This is a solid base for a good stock. ERF has a bad growth rate and is valued cheaply. 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
With an excellent Return On Assets value of 18.87%, ERF belongs to the best of the industry, outperforming 96.65% of the companies in the same industry.
ERF has a better Return On Equity (30.88%) than 97.13% of its industry peers.
ERF has a Return On Invested Capital of 23.71%. This is amongst the best in the industry. ERF outperforms 99.04% of its industry peers.
The Average Return On Invested Capital over the past 3 years for ERF is significantly above the industry average of 7.31%.
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
The Profit Margin of ERF (23.87%) is better than 90.43% of its industry peers.
In the last couple of years the Profit Margin of ERF has remained more or less at the same level.
ERF has a better Operating Margin (29.94%) than 85.17% of its industry peers.
ERF's Operating Margin has declined in the last couple of years.
With a decent Gross Margin value of 66.55%, ERF is doing good in the industry, outperforming 77.03% of the companies in the same industry.
In the last couple of years the Gross Margin of ERF has remained more or less at the same level.
| 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.
ERF has less shares outstanding than it did 5 years ago.
ERF has a better debt/assets ratio than last year.
2.2 Solvency
ERF has an Altman-Z score of 3.71. This indicates that ERF is financially healthy and has little risk of 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.
Looking at the Debt to FCF ratio, with a value of 0.66, ERF belongs to the top 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.
The Debt to Equity ratio of ERF (0.08) is better than 69.86% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.08 | ||
| Debt/FCF | 0.66 | ||
| Altman-Z | 3.71 |
ROIC/WACC2.89
WACC8.2%
2.3 Liquidity
A Current Ratio of 0.70 indicates that ERF may have some problems paying its short term obligations.
The Current ratio of ERF (0.70) is comparable to the rest of the industry.
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%.
Measured over the past 5 years, ERF shows a small growth in Earnings Per Share. The EPS has been growing by 6.39% on average per year.
Looking at the last year, ERF shows a very negative growth in Revenue. The Revenue has decreased by -28.47% in the last year.
ERF shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 5.17% yearly.
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
The Earnings Per Share is expected to grow by 19.13% on average over the next years. This is quite good.
ERF is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 4.12% yearly.
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
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
ERF is valuated reasonably with a Price/Earnings ratio of 10.80.
Compared to the rest of the industry, the Price/Earnings ratio of ERF is on the same level as its industry peers.
The average S&P500 Price/Earnings ratio is at 26.82. ERF is valued rather cheaply when compared to this.
ERF is valuated cheaply with a Price/Forward Earnings ratio of 6.53.
Based on the Price/Forward Earnings ratio, ERF is valued a bit cheaper than the industry average as 67.94% of the companies are valued more expensively.
When comparing the Price/Forward Earnings ratio of ERF to the average of the S&P500 Index (36.21), we can say ERF is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 10.8 | ||
| Fwd PE | 6.53 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of ERF indicates a somewhat cheap valuation: ERF is cheaper than 77.99% of the companies listed in the same industry.
Based on the Price/Free Cash Flow ratio, ERF is valued a bit cheaper than 65.07% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 15.13 | ||
| EV/EBITDA | 4.76 |
4.3 Compensation for Growth
ERF's 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.
A more expensive valuation may be justified as ERF's earnings are expected to grow with 19.13% in the coming years.
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%.
ERF's Dividend Yield is comparable with the industry average which is at 6.32.
Compared to an average S&P500 Dividend Yield of 2.35, ERF's dividend is way lower than the S&P500 average.
| 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 paid a dividend for at least 10 years, which is a reliable track record.
As ERF did not decrease their dividend in the past 5 years, we can say the dividend looks stable.
Dividend Growth(5Y)13.74%
Div Incr Years4
Div Non Decr Years7
5.3 Sustainability
12.97% of the earnings are spent on dividend by ERF. This is a low number and 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%