FORTIS INC (FTS) Stock Fundamental Analysis
NYSE:FTS - New York Stock Exchange, Inc. - CA3495531079 - Common Stock - Currency: USD
We assign a fundamental rating of 2 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 has a expensive valuation and it also scores bad on growth.
1. Profitability
1.1 Basic Checks
In the past year FTS was profitable.
FTS had a positive operating cash flow in the past year.
Each year in the past 5 years FTS has been profitable.
In the past 5 years FTS always reported a positive cash flow from operatings.
1.2 Ratios
With a Return On Assets value of 2.20%, FTS is not doing good in the industry: 74.47% of the companies in the same industry are doing better.
With a Return On Equity value of 6.82%, FTS is not doing good in the industry: 87.23% of the companies in the same industry are doing better.
FTS has a Return On Invested Capital (4.04%) which is comparable to the rest of the industry.
Measured over the past 3 years, the Average Return On Invested Capital for FTS is significantly below the industry average of 38.55%.
| 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
FTS has a Profit Margin of 14.03%. This is comparable to the rest of the industry: FTS outperforms 53.19% of its industry peers.
FTS's Profit Margin has declined in the last couple of years.
FTS has a Operating Margin of 28.73%. This is amongst the best in the industry. FTS outperforms 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.
The Gross Margin of FTS (72.03%) is better than 72.34% of its industry peers.
FTS's Gross Margin has been stable in the last couple of years.
| 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
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so FTS is destroying value.
FTS has more shares outstanding than it did 1 year ago.
Compared to 5 years ago, FTS has more shares outstanding
Compared to 1 year ago, FTS has a worse debt to assets ratio.
2.2 Solvency
Based on the Altman-Z score of 0.79, we must say that FTS is in the distress zone and has some risk of bankruptcy.
FTS has a Altman-Z score (0.79) which is comparable to the rest of the industry.
FTS has a Debt/Equity ratio of 1.37. This is a high value indicating a heavy dependency on external financing.
FTS has a Debt to Equity ratio (1.37) which is in line with its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.37 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 0.79 |
ROIC/WACC0.73
WACC5.51%
2.3 Liquidity
A Current Ratio of 0.76 indicates that FTS may have some problems paying its short term obligations.
FTS has a worse Current ratio (0.76) 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.
The Quick ratio of FTS (0.63) is worse than 65.96% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.76 | ||
| Quick Ratio | 0.63 |
3. Growth
3.1 Past
FTS shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 8.86%, which is quite good.
The Earnings Per Share has been growing slightly by 5.08% on average over the past years.
FTS shows a decrease in Revenue. In the last year, the revenue decreased by -0.08%.
FTS shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 5.55% yearly.
EPS 1Y (TTM)8.86%
EPS 3Y8.19%
EPS 5Y5.08%
EPS Q2Q%13.43%
Revenue 1Y (TTM)-0.08%
Revenue growth 3Y6.8%
Revenue growth 5Y5.55%
Sales Q2Q%5.43%
3.2 Future
Based on estimates for the next years, FTS will show a small growth in Earnings Per Share. The EPS will grow by 5.31% on average per year.
FTS is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 3.02% yearly.
EPS Next Y5.01%
EPS Next 2Y4.48%
EPS Next 3Y4.84%
EPS Next 5Y5.31%
Revenue Next Year4.5%
Revenue Next 2Y4.18%
Revenue Next 3Y3.79%
Revenue Next 5Y3.02%
3.3 Evolution
The EPS growth rate is stable: in the next years the growth will be about the same than in the last years.
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
Based on the Price/Earnings ratio of 20.17, the valuation of FTS can be described as rather expensive.
FTS's Price/Earnings ratio is a bit more expensive when compared to the industry. FTS is more expensive than 63.83% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 27.03, FTS is valued a bit cheaper.
FTS is valuated rather expensively with a Price/Forward Earnings ratio of 19.41.
Based on the Price/Forward Earnings ratio, FTS is valued a bit more expensive than 70.21% of the companies in the same industry.
FTS's Price/Forward Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 36.28.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 20.17 | ||
| Fwd PE | 19.41 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, FTS is valued a bit more expensive than the industry average as 68.09% of the companies are valued more cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 12.87 |
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)4.02
PEG (5Y)3.97
EPS Next 2Y4.48%
EPS Next 3Y4.84%
5. Dividend
5.1 Amount
FTS has a Yearly Dividend Yield of 3.58%.
FTS's Dividend Yield is rather good when compared to the industry average which is at 3.66. FTS pays more dividend than 85.11% of the companies in the same industry.
FTS's Dividend Yield is a higher than the S&P500 average which is at 2.40.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.58% |
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.
FTS's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP50.67%
EPS Next 2Y4.48%
EPS Next 3Y4.84%
50.43
-0.04 (-0.08%)
Chartmill FA Rating
GICS SectorUtilities
GICS IndustryGroupUtilities
GICS IndustryElectric Utilities
Earnings (Last)
Earnings (Next)
Inst Owners55.26%
Inst Owner Change0.34%
Ins Owners0.11%
Ins Owner ChangeN/A
Market Cap25.40B
Analysts55.83
Price Target52.01 (3.13%)
Short Float %1.69%
Short Ratio15.25
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.58% |
Yearly Dividend1.2
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)-0.54%
PT rev (3m)4.67%
EPS NQ rev (1m)0.67%
EPS NQ rev (3m)-0.61%
EPS NY rev (1m)0%
EPS NY rev (3m)0%
Revenue NQ rev (1m)0.58%
Revenue NQ rev (3m)-2.53%
Revenue NY rev (1m)-0.85%
Revenue NY rev (3m)-0.41%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 20.17 | ||
| Fwd PE | 19.41 | ||
| P/S | 2.98 | ||
| P/FCF | N/A | ||
| P/OCF | 8.09 | ||
| P/B | 1.45 | ||
| P/tB | 3.75 | ||
| EV/EBITDA | 12.87 |
EPS(TTM)2.5
EY4.96%
EPS(NY)2.6
Fwd EY5.15%
FCF(TTM)-1.9
FCFYN/A
OCF(TTM)6.24
OCFY12.37%
SpS16.9
BVpS34.78
TBVpS13.46
PEG (NY)4.02
PEG (5Y)3.97
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 | 0.79 |
F-Score5
WACC5.51%
ROIC/WACC0.73
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)8.86%
EPS 3Y8.19%
EPS 5Y5.08%
EPS Q2Q%13.43%
EPS Next Y5.01%
EPS Next 2Y4.48%
EPS Next 3Y4.84%
EPS Next 5Y5.31%
Revenue 1Y (TTM)-0.08%
Revenue growth 3Y6.8%
Revenue growth 5Y5.55%
Sales Q2Q%5.43%
Revenue Next Year4.5%
Revenue Next 2Y4.18%
Revenue Next 3Y3.79%
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 5Y16.93%
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%