H&E EQUIPMENT SERVICES INC (HEES) Stock Fundamental Analysis
NASDAQ:HEES - Nasdaq - US4040301081 - Common Stock - Currency: USD
We assign a fundamental rating of 3 out of 10 to HEES. HEES was compared to 49 industry peers in the Trading Companies & Distributors industry. HEES has a medium profitability rating, but doesn't score so well on its financial health evaluation. HEES does not seem to be growing, but still is valued expensively.
1. Profitability
1.1 Basic Checks
In the past year HEES was profitable.
HEES had a positive operating cash flow in the past year.
Of the past 5 years HEES 4 years were profitable.
Each year in the past 5 years HEES had a positive operating cash flow.
1.2 Ratios
HEES has a Return On Assets of 3.39%. This is comparable to the rest of the industry: HEES outperforms 51.02% of its industry peers.
Looking at the Return On Equity, with a value of 15.05%, HEES is in the better half of the industry, outperforming 63.27% of the companies in the same industry.
Looking at the Return On Invested Capital, with a value of 5.96%, HEES is in line with its industry, outperforming 48.98% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for HEES is in line with the industry average of 9.77%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.39% | ||
| ROE | 15.05% | ||
| ROIC | 5.96% |
ROA(3y)5.53%
ROA(5y)3.97%
ROE(3y)28.14%
ROE(5y)20.89%
ROIC(3y)8.17%
ROIC(5y)6.83%
1.3 Margins
HEES's Profit Margin of 6.21% is fine compared to the rest of the industry. HEES outperforms 71.43% of its industry peers.
HEES's Profit Margin has been stable in the last couple of years.
The Operating Margin of HEES (12.36%) is better than 75.51% of its industry peers.
HEES's Operating Margin has been stable in the last couple of years.
HEES's Gross Margin of 43.28% is fine compared to the rest of the industry. HEES outperforms 77.55% of its industry peers.
In the last couple of years the Gross Margin of HEES has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 12.36% | ||
| PM (TTM) | 6.21% | ||
| GM | 43.28% |
OM growth 3Y7.13%
OM growth 5Y0.88%
PM growth 3Y-5.62%
PM growth 5Y0.89%
GM growth 3Y4.44%
GM growth 5Y2.47%
2. Health
2.1 Basic Checks
HEES has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
Compared to 1 year ago, HEES has more shares outstanding
HEES has more shares outstanding than it did 5 years ago.
HEES has a better debt/assets ratio than last year.
2.2 Solvency
HEES has an Altman-Z score of 1.93. This is not the best score and indicates that HEES is in the grey zone with still only limited risk for bankruptcy at the moment.
With a Altman-Z score value of 1.93, HEES is not doing good in the industry: 71.43% of the companies in the same industry are doing better.
The Debt to FCF ratio of HEES is 13.77, which is on the high side as it means it would take HEES, 13.77 years of fcf income to pay off all of its debts.
HEES has a Debt to FCF ratio (13.77) which is in line with its industry peers.
HEES has a Debt/Equity ratio of 2.26. This is a high value indicating a heavy dependency on external financing.
With a Debt to Equity ratio value of 2.26, HEES is not doing good in the industry: 79.59% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.26 | ||
| Debt/FCF | 13.77 | ||
| Altman-Z | 1.93 |
ROIC/WACC0.64
WACC9.34%
2.3 Liquidity
HEES has a Current Ratio of 0.63. This is a bad value and indicates that HEES is not financially healthy enough and could expect problems in meeting its short term obligations.
With a Current ratio value of 0.63, HEES is not doing good in the industry: 95.92% of the companies in the same industry are doing better.
HEES has a Quick Ratio of 0.63. This is a bad value and indicates that HEES is not financially healthy enough and could expect problems in meeting its short term obligations.
HEES's Quick ratio of 0.59 is on the low side compared to the rest of the industry. HEES is outperformed by 81.63% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.63 | ||
| Quick Ratio | 0.59 |
3. Growth
3.1 Past
HEES shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -41.84%.
HEES shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 5.09% yearly.
HEES shows a decrease in Revenue. In the last year, the revenue decreased by -3.52%.
Measured over the past years, HEES shows a small growth in Revenue. The Revenue has been growing by 6.18% on average per year.
EPS 1Y (TTM)-41.84%
EPS 3Y24.34%
EPS 5Y5.09%
EPS Q2Q%-95.77%
Revenue 1Y (TTM)-3.52%
Revenue growth 3Y12.58%
Revenue growth 5Y6.18%
Sales Q2Q%-13.98%
3.2 Future
The Earnings Per Share is expected to decrease by -0.18% on average over the next years.
HEES is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 3.68% yearly.
EPS Next Y-31.61%
EPS Next 2Y-0.18%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue Next Year0.39%
Revenue Next 2Y3.68%
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 decreasing.
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
HEES is valuated quite expensively with a Price/Earnings ratio of 34.04.
Compared to the rest of the industry, the Price/Earnings ratio of HEES is on the same level as its industry peers.
The average S&P500 Price/Earnings ratio is at 26.55. HEES is valued slightly more expensive when compared to this.
With a Price/Forward Earnings ratio of 27.45, HEES can be considered very expensive at the moment.
HEES's Price/Forward Earnings ratio is a bit more expensive when compared to the industry. HEES is more expensive than 63.27% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of HEES to the average of the S&P500 Index (22.40), we can say HEES is valued slightly more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 34.04 | ||
| Fwd PE | 27.45 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, HEES is valued cheaper than 85.71% of the companies in the same industry.
HEES's Price/Free Cash Flow is on the same level as the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 35.07 | ||
| EV/EBITDA | 7.76 |
4.3 Compensation for Growth
The decent profitability rating of HEES may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)6.69
EPS Next 2Y-0.18%
EPS Next 3YN/A
5. Dividend
5.1 Amount
HEES has a Yearly Dividend Yield of 1.16%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 2.04, HEES pays a bit more dividend than its industry peers.
Compared to an average S&P500 Dividend Yield of 2.39, HEES's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.16% |
5.2 History
The dividend of HEES decreases each year by -0.02%.
HEES has paid a dividend for at least 10 years, which is a reliable track record.
HEES has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)-0.02%
Div Incr Years0
Div Non Decr Years10
5.3 Sustainability
HEES pays out 44.29% of its income as dividend. This is a bit on the high side, but may be sustainable.
HEES's earnings and Dividend Rate are declining. This means the current dividend is most likely not sustainable.
DP44.29%
EPS Next 2Y-0.18%
EPS Next 3YN/A
94.64
-0.6 (-0.63%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryTrading Companies & Distributors
Earnings (Last)
Earnings (Next)
Inst Owners85.48%
Inst Owner Change-4.69%
Ins Owners12.41%
Ins Owner Change-97.06%
Market Cap3.47B
Analysts47.5
Price Target86.7 (-8.39%)
Short Float %5.24%
Short Ratio2.32
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.16% |
Yearly Dividend1.1
Dividend Growth(5Y)-0.02%
DP44.29%
Div Incr Years0
Div Non Decr Years10
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-37.57%
Min EPS beat(2)-95.33%
Max EPS beat(2)20.2%
EPS beat(4)1
Avg EPS beat(4)-26.33%
Min EPS beat(4)-95.33%
Max EPS beat(4)20.2%
EPS beat(8)4
Avg EPS beat(8)-10.27%
EPS beat(12)8
Avg EPS beat(12)1.39%
EPS beat(16)12
Avg EPS beat(16)7.88%
Revenue beat(2)1
Avg Revenue beat(2)-6.27%
Min Revenue beat(2)-13.63%
Max Revenue beat(2)1.09%
Revenue beat(4)1
Avg Revenue beat(4)-4.69%
Min Revenue beat(4)-13.63%
Max Revenue beat(4)1.09%
Revenue beat(8)4
Avg Revenue beat(8)-1.43%
Revenue beat(12)7
Avg Revenue beat(12)-0.3%
Revenue beat(16)9
Avg Revenue beat(16)-1.57%
PT rev (1m)0%
PT rev (3m)0%
EPS NQ rev (1m)35.45%
EPS NQ rev (3m)-22.4%
EPS NY rev (1m)-37.8%
EPS NY rev (3m)-38.3%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-8.41%
Revenue NY rev (1m)3.15%
Revenue NY rev (3m)-3.57%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 34.04 | ||
| Fwd PE | 27.45 | ||
| P/S | 2.37 | ||
| P/FCF | 35.07 | ||
| P/OCF | 6.8 | ||
| P/B | 5.75 | ||
| P/tB | 8.51 | ||
| EV/EBITDA | 7.76 |
EPS(TTM)2.78
EY2.94%
EPS(NY)3.45
Fwd EY3.64%
FCF(TTM)2.7
FCFY2.85%
OCF(TTM)13.91
OCFY14.7%
SpS39.94
BVpS16.47
TBVpS11.12
PEG (NY)N/A
PEG (5Y)6.69
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.39% | ||
| ROE | 15.05% | ||
| ROCE | 7.87% | ||
| ROIC | 5.96% | ||
| ROICexc | 5.99% | ||
| ROICexgc | 6.54% | ||
| OM | 12.36% | ||
| PM (TTM) | 6.21% | ||
| GM | 43.28% | ||
| FCFM | 6.76% |
ROA(3y)5.53%
ROA(5y)3.97%
ROE(3y)28.14%
ROE(5y)20.89%
ROIC(3y)8.17%
ROIC(5y)6.83%
ROICexc(3y)8.33%
ROICexc(5y)7.4%
ROICexgc(3y)8.97%
ROICexgc(5y)7.96%
ROCE(3y)10.79%
ROCE(5y)9.02%
ROICexcg growth 3Y1.18%
ROICexcg growth 5Y-1.16%
ROICexc growth 3Y0.48%
ROICexc growth 5Y-0.78%
OM growth 3Y7.13%
OM growth 5Y0.88%
PM growth 3Y-5.62%
PM growth 5Y0.89%
GM growth 3Y4.44%
GM growth 5Y2.47%
F-Score5
Asset Turnover0.55
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.26 | ||
| Debt/FCF | 13.77 | ||
| Debt/EBITDA | 2.19 | ||
| Cap/Depr | 93.34% | ||
| Cap/Sales | 28.07% | ||
| Interest Coverage | 2.59 | ||
| Cash Conversion | 82.07% | ||
| Profit Quality | 108.88% | ||
| Current Ratio | 0.63 | ||
| Quick Ratio | 0.59 | ||
| Altman-Z | 1.93 |
F-Score5
WACC9.34%
ROIC/WACC0.64
Cap/Depr(3y)155.79%
Cap/Depr(5y)138%
Cap/Sales(3y)40.66%
Cap/Sales(5y)35.59%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-41.84%
EPS 3Y24.34%
EPS 5Y5.09%
EPS Q2Q%-95.77%
EPS Next Y-31.61%
EPS Next 2Y-0.18%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue 1Y (TTM)-3.52%
Revenue growth 3Y12.58%
Revenue growth 5Y6.18%
Sales Q2Q%-13.98%
Revenue Next Year0.39%
Revenue Next 2Y3.68%
Revenue Next 3YN/A
Revenue Next 5YN/A
EBIT growth 1Y-36.15%
EBIT growth 3Y20.61%
EBIT growth 5Y7.11%
EBIT Next Year175.47%
EBIT Next 3YN/A
EBIT Next 5YN/A
FCF growth 1Y142.65%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y60.44%
OCF growth 3Y24.05%
OCF growth 5Y9.2%