FORTIS INC (FTS) Stock Fundamental Analysis
NYSE:FTS - New York Stock Exchange, Inc. - CA3495531079 - Common Stock - Currency: USD
We assign a fundamental rating of 3 out of 10 to FTS. FTS was compared to 47 industry peers in the Electric Utilities industry. While FTS is still in line with the averages on profitability rating, there are concerns on its financial health. FTS is valued expensive and it does not seem to be growing. Finally FTS also has an excellent dividend rating.
1. Profitability
1.1 Basic Checks
In the past year FTS was profitable.
In the past year FTS had a positive cash flow from operations.
FTS had positive earnings in each of the past 5 years.
FTS had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
FTS has a Return On Assets of 2.20%. This is in the lower half of the industry: FTS underperforms 74.47% of its industry peers.
Looking at the Return On Equity, with a value of 6.82%, FTS is doing worse than 87.23% of the companies in the same industry.
FTS's Return On Invested Capital of 4.04% is in line compared to the rest of the industry. FTS outperforms 44.68% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for FTS is significantly below the industry average of 38.54%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.2% | ||
| ROE | 6.82% | ||
| ROIC | 4.04% |
ROA(3y)2.18%
ROA(5y)2.17%
ROE(3y)6.69%
ROE(5y)6.58%
ROIC(3y)4.1%
ROIC(5y)4.04%
1.3 Margins
The Profit Margin of FTS (14.03%) is comparable to the rest of the industry.
FTS's Profit Margin has declined in the last couple of years.
The Operating Margin of FTS (28.73%) is better than 91.49% of its industry peers.
In the last couple of years the Operating Margin of FTS has remained more or less at the same level.
With a decent Gross Margin value of 72.03%, FTS is doing good in the industry, outperforming 72.34% of the companies in the same industry.
In the last couple of years the Gross Margin of FTS has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 28.73% | ||
| PM (TTM) | 14.03% | ||
| GM | 72.03% |
OM growth 3Y3.06%
OM growth 5Y0.41%
PM growth 3Y2.32%
PM growth 5Y-5.83%
GM growth 3Y1.43%
GM growth 5Y0.13%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), FTS is destroying value.
FTS has more shares outstanding than it did 1 year ago.
The number of shares outstanding for FTS has been increased compared to 5 years ago.
Compared to 1 year ago, FTS has a worse debt to assets ratio.
2.2 Solvency
FTS has an Altman-Z score of 0.76. This is a bad value and indicates that FTS is not financially healthy and even has some risk of bankruptcy.
FTS has a Altman-Z score (0.76) which is comparable to the rest of the industry.
A Debt/Equity ratio of 1.37 is on the high side and indicates that FTS has dependencies on debt financing.
FTS has a Debt to Equity ratio (1.37) which is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.37 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 0.76 |
ROIC/WACC0.51
WACC7.96%
2.3 Liquidity
FTS has a Current Ratio of 0.76. This is a bad value and indicates that FTS is not financially healthy enough and could expect problems in meeting its short term obligations.
The Current ratio of FTS (0.76) is worse than 70.21% of its industry peers.
A Quick Ratio of 0.63 indicates that FTS may have some problems paying its short term obligations.
FTS has a Quick ratio of 0.63. This is in the lower half of the industry: FTS underperforms 65.96% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.76 | ||
| Quick Ratio | 0.63 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 7.72% over the past year.
The Earnings Per Share has been growing slightly by 5.08% on average over the past years.
Looking at the last year, FTS shows a small growth in Revenue. The Revenue has grown by 3.64% in the last year.
The Revenue has been growing slightly by 5.55% on average over the past years.
EPS 1Y (TTM)7.72%
EPS 3Y8.19%
EPS 5Y5.08%
EPS Q2Q%7.53%
Revenue 1Y (TTM)3.64%
Revenue growth 3Y6.8%
Revenue growth 5Y5.55%
Sales Q2Q%7.06%
3.2 Future
The Earnings Per Share is expected to grow by 5.32% on average over the next years.
The Revenue is expected to grow by 3.02% on average over the next years.
EPS Next Y5.01%
EPS Next 2Y4.48%
EPS Next 3Y4.84%
EPS Next 5Y5.32%
Revenue Next Year5.39%
Revenue Next 2Y4.82%
Revenue Next 3Y4.06%
Revenue Next 5Y3.02%
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 stable.
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
With a Price/Earnings ratio of 19.28, FTS is valued on the expensive side.
FTS's Price/Earnings ratio is a bit more expensive when compared to the industry. FTS is more expensive than 61.70% of the companies in the same industry.
When comparing the Price/Earnings ratio of FTS to the average of the S&P500 Index (26.35), we can say FTS is valued slightly cheaper.
Based on the Price/Forward Earnings ratio of 18.02, the valuation of FTS can be described as rather expensive.
Compared to the rest of the industry, the Price/Forward Earnings ratio of FTS indicates a slightly more expensive valuation: FTS is more expensive than 72.34% of the companies listed in the same industry.
FTS is valuated at similar levels of the S&P average when we compare the Price/Forward Earnings ratio to 22.19, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.28 | ||
| Fwd PE | 18.02 |
4.2 Price Multiples
68.09% of the companies in the same industry are cheaper than FTS, based on the Enterprise Value to EBITDA ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 12.37 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
PEG (NY)3.85
PEG (5Y)3.79
EPS Next 2Y4.48%
EPS Next 3Y4.84%
5. Dividend
5.1 Amount
FTS has a Yearly Dividend Yield of 8.14%, which is a nice return.
Compared to an average industry Dividend Yield of 3.69, FTS pays a better dividend. On top of this FTS pays more dividend than 100.00% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 2.42, FTS pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 8.14% |
5.2 History
The dividend of FTS has a limited annual growth rate of 5.61%.
FTS has paid a dividend for at least 10 years, which is a reliable track record.
FTS has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)5.61%
Div Incr Years21
Div Non Decr Years21
5.3 Sustainability
50.67% of the earnings are spent on dividend by FTS. This is a bit on the high side, but may be sustainable.
The dividend of FTS is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP50.67%
EPS Next 2Y4.48%
EPS Next 3Y4.84%
47.05
-0.28 (-0.59%)
Chartmill FA Rating
GICS SectorUtilities
GICS IndustryGroupUtilities
GICS IndustryElectric Utilities
Earnings (Last)
Earnings (Next)
Inst Owners55.26%
Inst Owner Change-0.2%
Ins Owners0.11%
Ins Owner ChangeN/A
Market Cap23.60B
Analysts53.04
Price Target51.38 (9.2%)
Short Float %1.87%
Short Ratio14.93
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 8.14% |
Yearly Dividend1.21
Dividend Growth(5Y)5.61%
DP50.67%
Div Incr Years21
Div Non Decr Years21
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)1.44%
Min EPS beat(2)1.1%
Max EPS beat(2)1.78%
EPS beat(4)4
Avg EPS beat(4)1.78%
Min EPS beat(4)1.1%
Max EPS beat(4)2.52%
EPS beat(8)7
Avg EPS beat(8)1.67%
EPS beat(12)10
Avg EPS beat(12)1.87%
EPS beat(16)10
Avg EPS beat(16)0.11%
Revenue beat(2)0
Avg Revenue beat(2)-5.78%
Min Revenue beat(2)-11.44%
Max Revenue beat(2)-0.12%
Revenue beat(4)0
Avg Revenue beat(4)-4.96%
Min Revenue beat(4)-11.44%
Max Revenue beat(4)-0.12%
Revenue beat(8)0
Avg Revenue beat(8)-5.1%
Revenue beat(12)4
Avg Revenue beat(12)0.41%
Revenue beat(16)8
Avg Revenue beat(16)1.55%
PT rev (1m)4.59%
PT rev (3m)14.03%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-0.98%
EPS NY rev (1m)0%
EPS NY rev (3m)0.13%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-3.47%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-3.21%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.28 | ||
| Fwd PE | 18.02 | ||
| P/S | 2.76 | ||
| P/FCF | N/A | ||
| P/OCF | 7.48 | ||
| P/B | 1.34 | ||
| P/tB | 3.47 | ||
| EV/EBITDA | 12.37 |
EPS(TTM)2.44
EY5.19%
EPS(NY)2.61
Fwd EY5.55%
FCF(TTM)-1.92
FCFYN/A
OCF(TTM)6.29
OCFY13.37%
SpS17.05
BVpS35.08
TBVpS13.57
PEG (NY)3.85
PEG (5Y)3.79
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.2% | ||
| ROE | 6.82% | ||
| ROCE | 4.86% | ||
| ROIC | 4.04% | ||
| ROICexc | 4.07% | ||
| ROICexgc | 5.19% | ||
| OM | 28.73% | ||
| PM (TTM) | 14.03% | ||
| GM | 72.03% | ||
| FCFM | N/A |
ROA(3y)2.18%
ROA(5y)2.17%
ROE(3y)6.69%
ROE(5y)6.58%
ROIC(3y)4.1%
ROIC(5y)4.04%
ROICexc(3y)4.12%
ROICexc(5y)4.06%
ROICexgc(3y)5.36%
ROICexgc(5y)5.34%
ROCE(3y)4.93%
ROCE(5y)4.87%
ROICexcg growth 3Y0.42%
ROICexcg growth 5Y-1.68%
ROICexc growth 3Y1.61%
ROICexc growth 5Y-0.39%
OM growth 3Y3.06%
OM growth 5Y0.41%
PM growth 3Y2.32%
PM growth 5Y-5.83%
GM growth 3Y1.43%
GM growth 5Y0.13%
F-Score5
Asset Turnover0.16
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.37 | ||
| Debt/FCF | N/A | ||
| Debt/EBITDA | 6.18 | ||
| Cap/Depr | 285.98% | ||
| Cap/Sales | 48.16% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 80.97% | ||
| Profit Quality | N/A | ||
| Current Ratio | 0.76 | ||
| Quick Ratio | 0.63 | ||
| Altman-Z | 0.76 |
F-Score5
WACC7.96%
ROIC/WACC0.51
Cap/Depr(3y)245.88%
Cap/Depr(5y)249.09%
Cap/Sales(3y)38.85%
Cap/Sales(5y)39.52%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)7.72%
EPS 3Y8.19%
EPS 5Y5.08%
EPS Q2Q%7.53%
EPS Next Y5.01%
EPS Next 2Y4.48%
EPS Next 3Y4.84%
EPS Next 5Y5.32%
Revenue 1Y (TTM)3.64%
Revenue growth 3Y6.8%
Revenue growth 5Y5.55%
Sales Q2Q%7.06%
Revenue Next Year5.39%
Revenue Next 2Y4.82%
Revenue Next 3Y4.06%
Revenue Next 5Y3.02%
EBIT growth 1Y7.64%
EBIT growth 3Y10.06%
EBIT growth 5Y5.99%
EBIT Next Year73.58%
EBIT Next 3Y25.68%
EBIT Next 5Y16.94%
FCF growth 1Y-81.46%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y36.24%
OCF growth 3Y10.12%
OCF growth 5Y7.71%