HYDRO ONE LTD (H.CA) Stock Fundamental Analysis
TSX:H - CA4488112083 - Common Stock
50.01 CAD
+0.08 (+0.16%)
Taking everything into account, H scores 4 out of 10 in our fundamental rating. H was compared to 18 industry peers in the Electric Utilities industry. While H belongs to the best of the industry regarding profitability, there are concerns on its financial health. While showing a medium growth rate, H is valued expensive at the moment.
1. Profitability
1.1 Basic Checks
In the past year H was profitable.
In the past year H had a positive cash flow from operations.
Each year in the past 5 years H has been profitable.
H had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
H has a Return On Assets of 3.32%. This is amongst the best in the industry. H outperforms 94.44% of its industry peers.
H has a Return On Equity of 10.14%. This is amongst the best in the industry. H outperforms 94.44% of its industry peers.
With an excellent Return On Invested Capital value of 5.24%, H belongs to the best of the industry, outperforming 100.00% of the companies in the same industry.
H had an Average Return On Invested Capital over the past 3 years of 5.28%. This is in line with the industry average of 4.02%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.32% | ||
| ROE | 10.14% | ||
| ROIC | 5.24% |
ROA(3y)3.26%
ROA(5y)3.76%
ROE(3y)9.38%
ROE(5y)10.76%
ROIC(3y)5.28%
ROIC(5y)5.06%
1.3 Margins
The Profit Margin of H (14.34%) is better than 94.44% of its industry peers.
H's Profit Margin has improved in the last couple of years.
H has a Operating Margin (24.14%) which is comparable to the rest of the industry.
H's Operating Margin has improved in the last couple of years.
H has a Gross Margin (51.76%) which is in line with its industry peers.
H's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 24.14% | ||
| PM (TTM) | 14.34% | ||
| GM | 51.76% |
OM growth 3Y1.29%
OM growth 5Y2.78%
PM growth 3Y0.67%
PM growth 5Y2.56%
GM growth 3Y0.46%
GM growth 5Y-0.32%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so H is destroying value.
Compared to 1 year ago, H has about the same amount of shares outstanding.
The number of shares outstanding for H has been increased compared to 5 years ago.
The debt/assets ratio for H is higher compared to a year ago.
2.2 Solvency
Based on the Altman-Z score of 1.28, we must say that H is in the distress zone and has some risk of bankruptcy.
The Altman-Z score of H (1.28) is better than 100.00% of its industry peers.
A Debt/Equity ratio of 1.39 is on the high side and indicates that H has dependencies on debt financing.
H's Debt to Equity ratio of 1.39 is in line compared to the rest of the industry. H outperforms 50.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.39 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 1.28 |
ROIC/WACC0.82
WACC6.41%
2.3 Liquidity
A Current Ratio of 0.36 indicates that H may have some problems paying its short term obligations.
The Current ratio of H (0.36) is worse than 94.44% of its industry peers.
H has a Quick Ratio of 0.36. This is a bad value and indicates that H is not financially healthy enough and could expect problems in meeting its short term obligations.
With a Quick ratio value of 0.36, H is not doing good in the industry: 94.44% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.36 | ||
| Quick Ratio | 0.36 |
3. Growth
3.1 Past
H shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 11.76%, which is quite good.
Measured over the past 5 years, H shows a small growth in Earnings Per Share. The EPS has been growing by 4.75% on average per year.
The Revenue has grown by 8.03% in the past year. This is quite good.
Measured over the past years, H shows a small growth in Revenue. The Revenue has been growing by 5.54% on average per year.
EPS 1Y (TTM)11.76%
EPS 3Y6.23%
EPS 5Y4.75%
EPS Q2Q%10.2%
Revenue 1Y (TTM)8.03%
Revenue growth 3Y5.5%
Revenue growth 5Y5.54%
Sales Q2Q%1.72%
3.2 Future
The Earnings Per Share is expected to grow by 6.78% on average over the next years.
H is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 4.36% yearly.
EPS Next Y11.31%
EPS Next 2Y7.98%
EPS Next 3Y7.12%
EPS Next 5Y6.78%
Revenue Next Year7.56%
Revenue Next 2Y5.3%
Revenue Next 3Y4.48%
Revenue Next 5Y4.36%
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.
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
A Price/Earnings ratio of 23.93 indicates a rather expensive valuation of H.
H's Price/Earnings ratio is rather expensive when compared to the industry. H is more expensive than 94.44% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 27.08, H is valued at the same level.
The Price/Forward Earnings ratio is 22.22, which indicates a rather expensive current valuation of H.
H's Price/Forward Earnings ratio is rather expensive when compared to the industry. H is more expensive than 94.44% of the companies in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 22.72, H is valued at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 23.93 | ||
| Fwd PE | 22.22 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of H indicates a rather expensive valuation: H more expensive than 94.44% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 15.26 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
The decent profitability rating of H may justify a higher PE ratio.
PEG (NY)2.11
PEG (5Y)5.03
EPS Next 2Y7.98%
EPS Next 3Y7.12%
5. Dividend
5.1 Amount
H has a Yearly Dividend Yield of 2.61%.
Compared to an average industry Dividend Yield of 5.76, H's dividend is way lower than its industry peers. On top of this 94.44% of the companies listed in the same industry pay a better dividend than H!
H's Dividend Yield is comparable with the S&P500 average which is at 2.34.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.61% |
5.2 History
The dividend of H has a limited annual growth rate of 4.69%.
H has been paying a dividend for at least 10 years, so it has a reliable track record.
As H did not decrease their dividend in the past 5 years, we can say the dividend looks stable.
Dividend Growth(5Y)4.69%
Div Incr Years7
Div Non Decr Years7
5.3 Sustainability
60.91% of the earnings are spent on dividend by H. This is not a sustainable payout ratio.
H's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP60.91%
EPS Next 2Y7.98%
EPS Next 3Y7.12%
TSX:H (8/29/2025, 7:00:00 PM)
50.01
+0.08 (+0.16%)
Chartmill FA Rating
GICS SectorUtilities
GICS IndustryGroupUtilities
GICS IndustryElectric Utilities
Earnings (Last)
Earnings (Next)
Inst Owners21.05%
Inst Owner ChangeN/A
Ins Owners0.02%
Ins Owner ChangeN/A
Market Cap29.99B
Analysts52.63
Price Target51.2 (2.38%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.61% |
Yearly Dividend1.24
Dividend Growth(5Y)4.69%
DP60.91%
Div Incr Years7
Div Non Decr Years7
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)6.4%
Min EPS beat(2)4.19%
Max EPS beat(2)8.61%
EPS beat(4)4
Avg EPS beat(4)4.92%
Min EPS beat(4)2.87%
Max EPS beat(4)8.61%
EPS beat(8)6
Avg EPS beat(8)2.66%
EPS beat(12)9
Avg EPS beat(12)2.39%
EPS beat(16)12
Avg EPS beat(16)2.41%
Revenue beat(2)0
Avg Revenue beat(2)-11.72%
Min Revenue beat(2)-19.33%
Max Revenue beat(2)-4.1%
Revenue beat(4)2
Avg Revenue beat(4)-1.27%
Min Revenue beat(4)-19.33%
Max Revenue beat(4)10.03%
Revenue beat(8)5
Avg Revenue beat(8)-0.53%
Revenue beat(12)6
Avg Revenue beat(12)-3.28%
Revenue beat(16)6
Avg Revenue beat(16)-4.37%
PT rev (1m)0.6%
PT rev (3m)6.18%
EPS NQ rev (1m)2.53%
EPS NQ rev (3m)5%
EPS NY rev (1m)2.84%
EPS NY rev (3m)2.84%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0%
Revenue NY rev (1m)1.67%
Revenue NY rev (3m)1.67%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 23.93 | ||
| Fwd PE | 22.22 | ||
| P/S | 3.42 | ||
| P/FCF | N/A | ||
| P/OCF | 12.29 | ||
| P/B | 2.42 | ||
| P/tB | 2.64 | ||
| EV/EBITDA | 15.26 |
EPS(TTM)2.09
EY4.18%
EPS(NY)2.25
Fwd EY4.5%
FCF(TTM)-0.67
FCFYN/A
OCF(TTM)4.07
OCFY8.14%
SpS14.61
BVpS20.66
TBVpS18.95
PEG (NY)2.11
PEG (5Y)5.03
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.32% | ||
| ROE | 10.14% | ||
| ROCE | 6.32% | ||
| ROIC | 5.24% | ||
| ROICexc | 5.25% | ||
| ROICexgc | 5.41% | ||
| OM | 24.14% | ||
| PM (TTM) | 14.34% | ||
| GM | 51.76% | ||
| FCFM | N/A |
ROA(3y)3.26%
ROA(5y)3.76%
ROE(3y)9.38%
ROE(5y)10.76%
ROIC(3y)5.28%
ROIC(5y)5.06%
ROICexc(3y)5.36%
ROICexc(5y)5.15%
ROICexgc(3y)5.54%
ROICexgc(5y)5.32%
ROCE(3y)6.26%
ROCE(5y)6.02%
ROICexcg growth 3Y1.33%
ROICexcg growth 5Y2.9%
ROICexc growth 3Y1.4%
ROICexc growth 5Y2.89%
OM growth 3Y1.29%
OM growth 5Y2.78%
PM growth 3Y0.67%
PM growth 5Y2.56%
GM growth 3Y0.46%
GM growth 5Y-0.32%
F-Score5
Asset Turnover0.23
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.39 | ||
| Debt/FCF | N/A | ||
| Debt/EBITDA | 5.63 | ||
| Cap/Depr | 302.34% | ||
| Cap/Sales | 32.44% | ||
| Interest Coverage | 3.03 | ||
| Cash Conversion | 79.9% | ||
| Profit Quality | N/A | ||
| Current Ratio | 0.36 | ||
| Quick Ratio | 0.36 | ||
| Altman-Z | 1.28 |
F-Score5
WACC6.41%
ROIC/WACC0.82
Cap/Depr(3y)280.72%
Cap/Depr(5y)266.35%
Cap/Sales(3y)30.49%
Cap/Sales(5y)29.09%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)11.76%
EPS 3Y6.23%
EPS 5Y4.75%
EPS Q2Q%10.2%
EPS Next Y11.31%
EPS Next 2Y7.98%
EPS Next 3Y7.12%
EPS Next 5Y6.78%
Revenue 1Y (TTM)8.03%
Revenue growth 3Y5.5%
Revenue growth 5Y5.54%
Sales Q2Q%1.72%
Revenue Next Year7.56%
Revenue Next 2Y5.3%
Revenue Next 3Y4.48%
Revenue Next 5Y4.36%
EBIT growth 1Y12.2%
EBIT growth 3Y6.86%
EBIT growth 5Y8.47%
EBIT Next Year65.53%
EBIT Next 3Y23.56%
EBIT Next 5Y15.43%
FCF growth 1Y-2327.78%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y11.06%
OCF growth 3Y5.65%
OCF growth 5Y9.44%