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Home Capital Group Inc (HCG.CA) Stock Fundamental Analysis

Canada - TSX:HCG - CA4369131079 - Common Stock

44.26 CAD
0 (0%)
Last: 9/1/2023, 7:00:00 PM
Fundamental Rating

4

HCG gets a fundamental rating of 4 out of 10. The analysis compared the fundamentals against 28 industry peers in the Financial Services industry. There are concerns on the financial health of HCG while its profitability can be described as average. HCG scores decently on growth, while it is valued quite cheap. This could make an interesting combination.


Dividend Valuation Growth Profitability Health

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4

1. Profitability

1.1 Basic Checks

In the past year HCG was profitable.
HCG had a positive operating cash flow in the past year.
Each year in the past 5 years HCG has been profitable.
Of the past 5 years HCG 4 years had a positive operating cash flow.
HCG.CA Yearly Net Income VS EBIT VS OCF VS FCFHCG.CA Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 0 200M -200M 400M 600M

1.2 Ratios

With a Return On Assets value of 0.76%, HCG perfoms like the industry average, outperforming 40.48% of the companies in the same industry.
HCG has a better Return On Equity (10.50%) than 88.10% of its industry peers.
Industry RankSector Rank
ROA 0.76%
ROE 10.5%
ROIC N/A
ROA(3y)0.93%
ROA(5y)0.84%
ROE(3y)11.9%
ROE(5y)10.37%
ROIC(3y)N/A
ROIC(5y)N/A
HCG.CA Yearly ROA, ROE, ROICHCG.CA Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2015 2016 2017 2018 2019 2020 2021 2022 5 10 15

1.3 Margins

The Profit Margin of HCG (32.48%) is better than 61.90% of its industry peers.
HCG's Profit Margin has improved in the last couple of years.
HCG does not have Operating Margin and Gross Margin available, so we won't be analyzing them here.
Industry RankSector Rank
OM N/A
PM (TTM) 32.48%
GM N/A
OM growth 3YN/A
OM growth 5YN/A
PM growth 3Y0.53%
PM growth 5Y72.9%
GM growth 3YN/A
GM growth 5YN/A
HCG.CA Yearly Profit, Operating, Gross MarginsHCG.CA Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2015 2016 2017 2018 2019 2020 2021 2022 10 20 30 40

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2

2. Health

2.1 Basic Checks

HCG does not have a ROIC to compare to the WACC, probably because it is not profitable.
Compared to 1 year ago, HCG has less shares outstanding
HCG has a better debt/assets ratio than last year.
HCG.CA Yearly Shares OutstandingHCG.CA Yearly Shares OutstandingYearly Shares Outstanding 2015 2016 2017 2018 2019 2020 2021 2022 20M 40M 60M
HCG.CA Yearly Total Debt VS Total AssetsHCG.CA Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2015 2016 2017 2018 2019 2020 2021 2022 5B 10B 15B 20B

2.2 Solvency

HCG has a debt to FCF ratio of 10.76. This is a negative value and a sign of low solvency as HCG would need 10.76 years to pay back of all of its debts.
The Debt to FCF ratio of HCG (10.76) is better than 69.05% of its industry peers.
A Debt/Equity ratio of 2.66 is on the high side and indicates that HCG has dependencies on debt financing.
With a Debt to Equity ratio value of 2.66, HCG is not doing good in the industry: 66.67% of the companies in the same industry are doing better.
Industry RankSector Rank
Debt/Equity 2.66
Debt/FCF 10.76
Altman-Z N/A
ROIC/WACCN/A
WACC9.09%
HCG.CA Yearly LT Debt VS Equity VS FCFHCG.CA Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 0 1B 2B 3B 4B

2.3 Liquidity

Industry RankSector Rank
Current Ratio N/A
Quick Ratio N/A
HCG.CA Yearly Current Assets VS Current LiabilitesHCG.CA Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2016 2017 2018 2019 2020 2021 2022 100M 200M 300M 400M

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6

3. Growth

3.1 Past

HCG shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 16.63%, which is quite good.
Measured over the past 5 years, HCG shows a small growth in Earnings Per Share. The EPS has been growing by 3.16% on average per year.
Looking at the last year, HCG shows a small growth in Revenue. The Revenue has grown by 3.26% in the last year.
HCG shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 5.33% yearly.
EPS 1Y (TTM)16.63%
EPS 3Y19.14%
EPS 5Y3.16%
EPS Q2Q%61.86%
Revenue 1Y (TTM)3.26%
Revenue growth 3Y2.83%
Revenue growth 5Y5.33%
Sales Q2Q%22.69%

3.2 Future

Based on estimates for the next years, HCG will show a very strong growth in Earnings Per Share. The EPS will grow by 27.46% on average per year.
Based on estimates for the next years, HCG will show a quite strong growth in Revenue. The Revenue will grow by 14.06% on average per year.
EPS Next Y52.54%
EPS Next 2Y27.46%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue Next Year22.24%
Revenue Next 2Y14.06%
Revenue Next 3YN/A
Revenue Next 5YN/A

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.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
HCG.CA Yearly Revenue VS EstimatesHCG.CA Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 100M 200M 300M 400M 500M
HCG.CA Yearly EPS VS EstimatesHCG.CA Yearly EPS VS EstimatesYearly EPS VS Estimates 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2 4 6

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8

4. Valuation

4.1 Price/Earnings Ratio

Based on the Price/Earnings ratio of 9.14, the valuation of HCG can be described as reasonable.
Compared to the rest of the industry, the Price/Earnings ratio of HCG indicates a rather cheap valuation: HCG is cheaper than 83.33% of the companies listed in the same industry.
The average S&P500 Price/Earnings ratio is at 27.02. HCG is valued rather cheaply when compared to this.
With a Price/Forward Earnings ratio of 7.00, the valuation of HCG can be described as very cheap.
Based on the Price/Forward Earnings ratio, HCG is valued cheaper than 80.95% of the companies in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 22.57, HCG is valued rather cheaply.
Industry RankSector Rank
PE 9.14
Fwd PE 7
HCG.CA Price Earnings VS Forward Price EarningsHCG.CA Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 20 40 60 80 100

4.2 Price Multiples

Compared to the rest of the industry, the Price/Free Cash Flow ratio of HCG indicates a rather cheap valuation: HCG is cheaper than 95.24% of the companies listed in the same industry.
Industry RankSector Rank
P/FCF 4.13
EV/EBITDA N/A
HCG.CA Per share dataHCG.CA EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 10 20 30 40

4.3 Compensation for Growth

HCG's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
HCG's earnings are expected to grow with 27.46% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.17
PEG (5Y)2.9
EPS Next 2Y27.46%
EPS Next 3YN/A

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2

5. Dividend

5.1 Amount

HCG has a Yearly Dividend Yield of 1.36%.
With a Dividend Yield of 1.36, HCG pays less dividend than the industry average, which is at 6.68. 85.71% of the companies listed in the same industry pay a better dividend than HCG!
Compared to an average S&P500 Dividend Yield of 2.44, HCG's dividend is way lower than the S&P500 average.
Industry RankSector Rank
Dividend Yield 1.36%

5.2 History

The dividend of HCG decreases each year by -3.09%.
HCG does not have a reliable dividend history as it only pays dividend since a couple or years.
Dividend Growth(5Y)-3.09%
Div Incr Years0
Div Non Decr Years0
HCG.CA Yearly Dividends per shareHCG.CA Yearly Dividends per shareYearly Dividends per share 2022 2023 0.1 0.2 0.3 0.4 0.5

5.3 Sustainability

HCG pays out 13.23% of its income as dividend. This is a sustainable payout ratio.
DP13.23%
EPS Next 2Y27.46%
EPS Next 3YN/A
HCG.CA Yearly Income VS Free CF VS DividendHCG.CA Yearly Income VS Free CF VS DividendYearly Income VS Free CF VS Dividend 2015 2016 2017 2018 2019 2020 2021 2022 0 200M -200M 400M 600M
HCG.CA Dividend Payout.HCG.CA Dividend Payout, showing the Payout Ratio.HCG.CA Dividend Payout.PayoutRetained Earnings

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Home Capital Group Inc

TSX:HCG (9/1/2023, 7:00:00 PM)

44.26

0 (0%)

Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupFinancial Services
GICS IndustryFinancial Services
Earnings (Last)N/A N/A
Earnings (Next)02-17 2022-02-17
Inst Owners32.83%
Inst Owner ChangeN/A
Ins OwnersN/A
Ins Owner ChangeN/A
Market Cap1.69B
Analysts48.89
Price Target44.88 (1.4%)
Short Float %N/A
Short RatioN/A
Dividend
Industry RankSector Rank
Dividend Yield 1.36%
Yearly Dividend0.6
Dividend Growth(5Y)-3.09%
DP13.23%
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)24.31%
Min EPS beat(2)23.76%
Max EPS beat(2)24.86%
EPS beat(4)2
Avg EPS beat(4)9.01%
Min EPS beat(4)-9.38%
Max EPS beat(4)24.86%
EPS beat(8)N/A
Avg EPS beat(8)N/A
EPS beat(12)N/A
Avg EPS beat(12)N/A
EPS beat(16)N/A
Avg EPS beat(16)N/A
Revenue beat(2)2
Avg Revenue beat(2)16.03%
Min Revenue beat(2)14.03%
Max Revenue beat(2)18.03%
Revenue beat(4)4
Avg Revenue beat(4)16.39%
Min Revenue beat(4)14.03%
Max Revenue beat(4)18.03%
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%
PT rev (3m)0%
EPS NQ rev (1m)2.02%
EPS NQ rev (3m)13.67%
EPS NY rev (1m)0%
EPS NY rev (3m)12.38%
Revenue NQ rev (1m)-3.4%
Revenue NQ rev (3m)13.26%
Revenue NY rev (1m)0%
Revenue NY rev (3m)7.83%
Valuation
Industry RankSector Rank
PE 9.14
Fwd PE 7
P/S 3.15
P/FCF 4.13
P/OCF 4
P/B 1.02
P/tB 1.06
EV/EBITDA N/A
EPS(TTM)4.84
EY10.94%
EPS(NY)6.32
Fwd EY14.28%
FCF(TTM)10.72
FCFY24.22%
OCF(TTM)11.07
OCFY25%
SpS14.03
BVpS43.41
TBVpS41.75
PEG (NY)0.17
PEG (5Y)2.9
Profitability
Industry RankSector Rank
ROA 0.76%
ROE 10.5%
ROCE N/A
ROIC N/A
ROICexc N/A
ROICexgc N/A
OM N/A
PM (TTM) 32.48%
GM N/A
FCFM 76.38%
ROA(3y)0.93%
ROA(5y)0.84%
ROE(3y)11.9%
ROE(5y)10.37%
ROIC(3y)N/A
ROIC(5y)N/A
ROICexc(3y)N/A
ROICexc(5y)N/A
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)N/A
ROCE(5y)N/A
ROICexcg growth 3YN/A
ROICexcg growth 5YN/A
ROICexc growth 3YN/A
ROICexc growth 5YN/A
OM growth 3YN/A
OM growth 5YN/A
PM growth 3Y0.53%
PM growth 5Y72.9%
GM growth 3YN/A
GM growth 5YN/A
F-Score7
Asset Turnover0.02
Health
Industry RankSector Rank
Debt/Equity 2.66
Debt/FCF 10.76
Debt/EBITDA N/A
Cap/Depr 69.37%
Cap/Sales 2.47%
Interest Coverage N/A
Cash Conversion N/A
Profit Quality 235.19%
Current Ratio N/A
Quick Ratio N/A
Altman-Z N/A
F-Score7
WACC9.09%
ROIC/WACCN/A
Cap/Depr(3y)91.52%
Cap/Depr(5y)69.5%
Cap/Sales(3y)4.03%
Cap/Sales(5y)3.39%
Profit Quality(3y)113.41%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)16.63%
EPS 3Y19.14%
EPS 5Y3.16%
EPS Q2Q%61.86%
EPS Next Y52.54%
EPS Next 2Y27.46%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue 1Y (TTM)3.26%
Revenue growth 3Y2.83%
Revenue growth 5Y5.33%
Sales Q2Q%22.69%
Revenue Next Year22.24%
Revenue Next 2Y14.06%
Revenue Next 3YN/A
Revenue Next 5YN/A
EBIT growth 1YN/A
EBIT growth 3YN/A
EBIT growth 5YN/A
EBIT Next YearN/A
EBIT Next 3YN/A
EBIT Next 5YN/A
FCF growth 1Y354.88%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y420.1%
OCF growth 3Y212.57%
OCF growth 5YN/A