Hess Corporation (HES) Stock Fundamental Analysis
NYSE:HES - US42809H1077 - Common Stock
148.97 USD
+1.42 (+0.96%)
160.31 USD
+11.34 (+7.61%)
We assign a fundamental rating of 5 out of 10 to HES. HES was compared to 209 industry peers in the Oil, Gas & Consumable Fuels industry. HES has an excellent profitability rating, but there are concerns on its financial health. HES is quite expensive at the moment. It does show a decent growth rate.
1. Profitability
1.1 Basic Checks
In the past year HES was profitable.
In the past year HES had a positive cash flow from operations.
HES had positive earnings in 4 of the past 5 years.
HES had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
HES has a Return On Assets of 8.21%. This is in the better half of the industry: HES outperforms 78.10% of its industry peers.
The Return On Equity of HES (19.33%) is better than 83.81% of its industry peers.
HES has a better Return On Invested Capital (12.13%) than 86.67% of its industry peers.
The Average Return On Invested Capital over the past 3 years for HES is significantly below the industry average of 21.91%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.21% | ||
| ROE | 19.33% | ||
| ROIC | 12.13% |
ROA(3y)8.62%
ROA(5y)2.43%
ROE(3y)22.25%
ROE(5y)3.6%
ROIC(3y)12.85%
ROIC(5y)N/A
1.3 Margins
HES has a better Profit Margin (17.82%) than 69.05% of its industry peers.
HES's Profit Margin has improved in the last couple of years.
With a decent Operating Margin value of 33.02%, HES is doing good in the industry, outperforming 74.29% of the companies in the same industry.
HES's Operating Margin has improved in the last couple of years.
The Gross Margin of HES (77.56%) is better than 88.57% of its industry peers.
In the last couple of years the Gross Margin of HES has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 33.02% | ||
| PM (TTM) | 17.82% | ||
| GM | 77.56% |
OM growth 3Y11.29%
OM growth 5Y32.64%
PM growth 3Y42.12%
PM growth 5YN/A
GM growth 3Y3.38%
GM growth 5Y2.03%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so HES is still creating some value.
Compared to 1 year ago, HES has more shares outstanding
The number of shares outstanding for HES has been increased compared to 5 years ago.
Compared to 1 year ago, HES has an improved debt to assets ratio.
2.2 Solvency
HES has an Altman-Z score of 2.99. This is not the best score and indicates that HES is in the grey zone with still only limited risk for bankruptcy at the moment.
With an excellent Altman-Z score value of 2.99, HES belongs to the best of the industry, outperforming 81.90% of the companies in the same industry.
The Debt to FCF ratio of HES is 7.90, which is on the high side as it means it would take HES, 7.90 years of fcf income to pay off all of its debts.
HES's Debt to FCF ratio of 7.90 is in line compared to the rest of the industry. HES outperforms 53.81% of its industry peers.
HES has a Debt/Equity ratio of 0.76. This is a neutral value indicating HES is somewhat dependend on debt financing.
With a Debt to Equity ratio value of 0.76, HES is not doing good in the industry: 63.81% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.76 | ||
| Debt/FCF | 7.9 | ||
| Altman-Z | 2.99 |
ROIC/WACC1.36
WACC8.89%
2.3 Liquidity
A Current Ratio of 1.08 indicates that HES should not have too much problems paying its short term obligations.
HES has a Current ratio of 1.08. This is comparable to the rest of the industry: HES outperforms 46.19% of its industry peers.
A Quick Ratio of 0.91 indicates that HES may have some problems paying its short term obligations.
Looking at the Quick ratio, with a value of 0.91, HES is in line with its industry, outperforming 47.62% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.08 | ||
| Quick Ratio | 0.91 |
3. Growth
3.1 Past
HES shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 17.66%, which is quite good.
HES shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 64.11% yearly.
The Revenue has grown by 9.55% in the past year. This is quite good.
HES shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 14.70% yearly.
EPS 1Y (TTM)17.66%
EPS 3Y64.11%
EPS 5YN/A
EPS Q2Q%-42.72%
Revenue 1Y (TTM)9.55%
Revenue growth 3Y19.95%
Revenue growth 5Y14.7%
Sales Q2Q%-12.06%
3.2 Future
HES is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 11.19% yearly.
HES is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 7.19% yearly.
EPS Next Y-35.51%
EPS Next 2Y-7.46%
EPS Next 3Y8.11%
EPS Next 5Y11.19%
Revenue Next Year-12.35%
Revenue Next 2Y0.34%
Revenue Next 3Y6.16%
Revenue Next 5Y7.19%
3.3 Evolution
The estimated forward EPS growth is still strong, although it is decreasing when compared to the stronger growth in the past 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
With a Price/Earnings ratio of 17.88, HES is valued on the expensive side.
Compared to the rest of the industry, the Price/Earnings ratio of HES is on the same level as its industry peers.
Compared to an average S&P500 Price/Earnings ratio of 27.03, HES is valued a bit cheaper.
Based on the Price/Forward Earnings ratio of 17.97, the valuation of HES can be described as rather expensive.
HES's Price/Forward Earnings is on the same level as the industry average.
When comparing the Price/Forward Earnings ratio of HES to the average of the S&P500 Index (22.63), we can say HES is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 17.88 | ||
| Fwd PE | 17.97 |
4.2 Price Multiples
HES's Enterprise Value to EBITDA ratio is in line with the industry average.
The rest of the industry has a similar Price/Free Cash Flow ratio as HES.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 41.32 | ||
| EV/EBITDA | 8.02 |
4.3 Compensation for Growth
HES has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y-7.46%
EPS Next 3Y8.11%
5. Dividend
5.1 Amount
HES has a Yearly Dividend Yield of 1.34%.
HES's Dividend Yield is slightly below the industry average, which is at 6.06.
With a Dividend Yield of 1.34, HES pays less dividend than the S&P500 average, which is at 2.32.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.34% |
5.2 History
On average, the dividend of HES grows each year by 12.15%, which is quite nice.
HES has paid a dividend for at least 10 years, which is a reliable track record.
HES has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)12.15%
Div Incr Years3
Div Non Decr Years34
5.3 Sustainability
HES pays out 26.90% of its income as dividend. This is a sustainable payout ratio.
The dividend of HES is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP26.9%
EPS Next 2Y-7.46%
EPS Next 3Y8.11%
148.97
+1.42 (+0.96%)
Chartmill FA Rating
GICS SectorEnergy
GICS IndustryGroupEnergy
GICS IndustryOil, Gas & Consumable Fuels
Earnings (Last)
Earnings (Next)
Inst Owners78.07%
Inst Owner Change3.94%
Ins Owners8.84%
Ins Owner Change-279.74%
Market Cap46.07B
Analysts74
Price Target164.07 (10.14%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.34% |
Yearly Dividend1.88
Dividend Growth(5Y)12.15%
DP26.9%
Div Incr Years3
Div Non Decr Years34
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)14.68%
Min EPS beat(2)11.23%
Max EPS beat(2)18.14%
EPS beat(4)4
Avg EPS beat(4)13.4%
Min EPS beat(4)4.48%
Max EPS beat(4)19.75%
EPS beat(8)8
Avg EPS beat(8)28.25%
EPS beat(12)11
Avg EPS beat(12)19.9%
EPS beat(16)15
Avg EPS beat(16)19.88%
Revenue beat(2)2
Avg Revenue beat(2)9.14%
Min Revenue beat(2)7.15%
Max Revenue beat(2)11.13%
Revenue beat(4)4
Avg Revenue beat(4)9.07%
Min Revenue beat(4)5.82%
Max Revenue beat(4)12.18%
Revenue beat(8)8
Avg Revenue beat(8)12.91%
Revenue beat(12)12
Avg Revenue beat(12)13.99%
Revenue beat(16)16
Avg Revenue beat(16)15.83%
PT rev (1m)0.82%
PT rev (3m)-0.2%
EPS NQ rev (1m)1.53%
EPS NQ rev (3m)-24.19%
EPS NY rev (1m)0.95%
EPS NY rev (3m)-6.27%
Revenue NQ rev (1m)0.15%
Revenue NQ rev (3m)-6.17%
Revenue NY rev (1m)-0.33%
Revenue NY rev (3m)-3.87%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 17.88 | ||
| Fwd PE | 17.97 | ||
| P/S | 3.69 | ||
| P/FCF | 41.32 | ||
| P/OCF | 7.53 | ||
| P/B | 4 | ||
| P/tB | 4.13 | ||
| EV/EBITDA | 8.02 |
EPS(TTM)8.33
EY5.59%
EPS(NY)8.29
Fwd EY5.57%
FCF(TTM)3.61
FCFY2.42%
OCF(TTM)19.78
OCFY13.27%
SpS40.41
BVpS37.25
TBVpS36.09
PEG (NY)N/A
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.21% | ||
| ROE | 19.33% | ||
| ROCE | 16.99% | ||
| ROIC | 12.13% | ||
| ROICexc | 12.83% | ||
| ROICexgc | 13.03% | ||
| OM | 33.02% | ||
| PM (TTM) | 17.82% | ||
| GM | 77.56% | ||
| FCFM | 8.92% |
ROA(3y)8.62%
ROA(5y)2.43%
ROE(3y)22.25%
ROE(5y)3.6%
ROIC(3y)12.85%
ROIC(5y)N/A
ROICexc(3y)14.1%
ROICexc(5y)N/A
ROICexgc(3y)14.37%
ROICexgc(5y)N/A
ROCE(3y)18.01%
ROCE(5y)N/A
ROICexcg growth 3Y15.5%
ROICexcg growth 5Y44.85%
ROICexc growth 3Y15.83%
ROICexc growth 5Y44.98%
OM growth 3Y11.29%
OM growth 5Y32.64%
PM growth 3Y42.12%
PM growth 5YN/A
GM growth 3Y3.38%
GM growth 5Y2.03%
F-Score6
Asset Turnover0.46
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.76 | ||
| Debt/FCF | 7.9 | ||
| Debt/EBITDA | 1.32 | ||
| Cap/Depr | 196.2% | ||
| Cap/Sales | 40.01% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 91.61% | ||
| Profit Quality | 50.07% | ||
| Current Ratio | 1.08 | ||
| Quick Ratio | 0.91 | ||
| Altman-Z | 2.99 |
F-Score6
WACC8.89%
ROIC/WACC1.36
Cap/Depr(3y)186.56%
Cap/Depr(5y)155.99%
Cap/Sales(3y)33.83%
Cap/Sales(5y)34.39%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)17.66%
EPS 3Y64.11%
EPS 5YN/A
EPS Q2Q%-42.72%
EPS Next Y-35.51%
EPS Next 2Y-7.46%
EPS Next 3Y8.11%
EPS Next 5Y11.19%
Revenue 1Y (TTM)9.55%
Revenue growth 3Y19.95%
Revenue growth 5Y14.7%
Sales Q2Q%-12.06%
Revenue Next Year-12.35%
Revenue Next 2Y0.34%
Revenue Next 3Y6.16%
Revenue Next 5Y7.19%
EBIT growth 1Y11.3%
EBIT growth 3Y33.49%
EBIT growth 5Y52.14%
EBIT Next Year25.05%
EBIT Next 3Y24.03%
EBIT Next 5Y27.46%
FCF growth 1Y-35.25%
FCF growth 3Y-16.98%
FCF growth 5YN/A
OCF growth 1Y29.08%
OCF growth 3Y24.67%
OCF growth 5Y27.81%