FORTIS INC (FTS) Stock Fundamental Analysis
NYSE:FTS - New York Stock Exchange, Inc. - CA3495531079 - Common Stock - Currency: USD
FTS gets a fundamental rating of 2 out of 10. The analysis compared the fundamentals against 46 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.
1. Profitability
1.1 Basic Checks
FTS had positive earnings in the past year.
In the past year FTS had a positive cash flow from operations.
In the past 5 years FTS has always been profitable.
Each year in the past 5 years FTS had a positive operating cash flow.
1.2 Ratios
FTS has a Return On Assets of 2.20%. This is in the lower half of the industry: FTS underperforms 76.09% of its industry peers.
FTS has a worse Return On Equity (6.82%) than 86.96% of its industry peers.
FTS has a Return On Invested Capital of 4.04%. This is comparable to the rest of the industry: FTS outperforms 45.65% 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 39.32%.
| 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
With a Profit Margin value of 14.03%, FTS perfoms like the industry average, outperforming 54.35% of the companies in the same industry.
FTS's Profit Margin has declined in the last couple of years.
The Operating Margin of FTS (28.73%) is better than 91.30% of its industry peers.
FTS's Operating Margin has been stable in the last couple of years.
The Gross Margin of FTS (72.03%) is better than 71.74% of its industry peers.
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
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.
The number of shares outstanding for FTS has been increased compared to 5 years ago.
The debt/assets ratio for FTS is higher compared to a year ago.
2.2 Solvency
FTS has an Altman-Z score of 0.77. This is a bad value and indicates that FTS is not financially healthy and even has some risk of bankruptcy.
With a Altman-Z score value of 0.77, FTS perfoms like the industry average, outperforming 43.48% of the companies in the same industry.
A Debt/Equity ratio of 1.37 is on the high side and indicates that FTS has dependencies on debt financing.
With a Debt to Equity ratio value of 1.37, FTS perfoms like the industry average, outperforming 50.00% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.37 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 0.77 |
ROIC/WACC0.71
WACC5.72%
2.3 Liquidity
A Current Ratio of 0.76 indicates that FTS may have some problems paying its short term obligations.
FTS's Current ratio of 0.76 is on the low side compared to the rest of the industry. FTS is outperformed by 71.74% of its industry peers.
A Quick Ratio of 0.63 indicates that FTS may have some problems paying its short term obligations.
With a Quick ratio value of 0.63, FTS is not doing good in the industry: 67.39% of the companies in the same industry are doing better.
| 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.
Measured over the past 5 years, FTS shows a small growth in Earnings Per Share. The EPS has been growing by 5.08% on average per year.
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
Based on estimates for the next years, FTS will show a small growth in Earnings Per Share. The EPS will grow by 5.09% on average per year.
The Revenue is expected to grow by 2.93% on average over the next years.
EPS Next Y5.01%
EPS Next 2Y4.48%
EPS Next 3Y4.84%
EPS Next 5Y5.09%
Revenue Next Year5.39%
Revenue Next 2Y4.82%
Revenue Next 3Y4.06%
Revenue Next 5Y2.93%
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 20.09, the valuation of FTS can be described as rather expensive.
65.22% of the companies in the same industry are cheaper than FTS, based on the Price/Earnings ratio.
Compared to an average S&P500 Price/Earnings ratio of 26.25, FTS is valued a bit cheaper.
A Price/Forward Earnings ratio of 18.83 indicates a rather expensive valuation of FTS.
71.74% of the companies in the same industry are cheaper than FTS, based on the Price/Forward Earnings ratio.
Compared to an average S&P500 Price/Forward Earnings ratio of 22.15, FTS is valued at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 20.09 | ||
| Fwd PE | 18.83 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, FTS is valued a bit more expensive than 67.39% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 12.64 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates FTS does not grow enough to justify the current Price/Earnings ratio.
PEG (NY)4.01
PEG (5Y)3.95
EPS Next 2Y4.48%
EPS Next 3Y4.84%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 3.70%, FTS has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 3.46, FTS pays a bit more dividend than its industry peers.
FTS's Dividend Yield is rather good when compared to the S&P500 average which is at 2.38.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.7% |
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%
48.83
+0.61 (+1.27%)
Chartmill FA Rating
GICS SectorUtilities
GICS IndustryGroupUtilities
GICS IndustryElectric Utilities
Earnings (Last)
Earnings (Next)
Inst Owners56.36%
Inst Owner Change-0.2%
Ins Owners0.11%
Ins Owner ChangeN/A
Market Cap24.49B
Analysts51.82
Price Target49.13 (0.61%)
Short Float %2.58%
Short Ratio20.82
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.7% |
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)0.63%
PT rev (3m)12.33%
EPS NQ rev (1m)-0.98%
EPS NQ rev (3m)-0.37%
EPS NY rev (1m)0%
EPS NY rev (3m)0.13%
Revenue NQ rev (1m)-3.47%
Revenue NQ rev (3m)-5.23%
Revenue NY rev (1m)0.44%
Revenue NY rev (3m)0.45%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 20.09 | ||
| Fwd PE | 18.83 | ||
| P/S | 2.88 | ||
| P/FCF | N/A | ||
| P/OCF | 7.82 | ||
| P/B | 1.4 | ||
| P/tB | 3.62 | ||
| EV/EBITDA | 12.64 |
EPS(TTM)2.43
EY4.98%
EPS(NY)2.59
Fwd EY5.31%
FCF(TTM)-1.91
FCFYN/A
OCF(TTM)6.25
OCFY12.79%
SpS16.93
BVpS34.85
TBVpS13.48
PEG (NY)4.01
PEG (5Y)3.95
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 | 0.77 |
F-Score5
WACC5.72%
ROIC/WACC0.71
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 5Y5.09%
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 5Y2.93%
EBIT growth 1Y7.64%
EBIT growth 3Y10.06%
EBIT growth 5Y5.99%
EBIT Next Year73.58%
EBIT Next 3Y25.68%
EBIT Next 5Y16.63%
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%