Hess Corporation (HES) Stock Fundamental Analysis
NYSE:HES - New York Stock Exchange, Inc. - US42809H1077 - Common Stock - Currency: USD
Taking everything into account, HES scores 5 out of 10 in our fundamental rating. HES was compared to 208 industry peers in the Oil, Gas & Consumable Fuels industry. HES scores excellent on profitability, but there are concerns on its financial health. While showing a medium growth rate, HES is valued expensive at the moment.
1. Profitability
1.1 Basic Checks
HES had positive earnings in the past year.
In the past year HES had a positive cash flow from operations.
HES had positive earnings in 4 of the past 5 years.
Each year in the past 5 years HES had a positive operating cash flow.
1.2 Ratios
With a decent Return On Assets value of 8.21%, HES is doing good in the industry, outperforming 78.10% of the companies in the same industry.
HES has a better Return On Equity (19.33%) than 83.81% of its industry peers.
The Return On Invested Capital of HES (12.13%) is better 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 23.51%.
| 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's Profit Margin of 17.82% is fine compared to the rest of the industry. HES outperforms 69.05% of its industry peers.
In the last couple of years the Profit Margin of HES has grown nicely.
HES's Operating Margin of 33.02% is fine compared to the rest of the industry. HES outperforms 74.29% of its industry peers.
In the last couple of years the Operating Margin of HES has grown nicely.
With an excellent Gross Margin value of 77.56%, HES belongs to the best of the industry, outperforming 88.57% of the companies in the same industry.
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
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), HES is creating some value.
HES has more shares outstanding than it did 1 year ago.
The number of shares outstanding for HES has been increased compared to 5 years ago.
The debt/assets ratio for HES has been reduced compared to a year ago.
2.2 Solvency
An Altman-Z score of 2.99 indicates that HES is not a great score, but indicates only limited risk for bankruptcy at the moment.
HES has a Altman-Z score of 2.99. This is amongst the best in the industry. HES outperforms 81.90% of its industry peers.
HES has a debt to FCF ratio of 7.90. This is a slightly negative value and a sign of low solvency as HES would need 7.90 years to pay back of all of its debts.
With a Debt to FCF ratio value of 7.90, HES perfoms like the industry average, outperforming 53.81% of the companies in the same industry.
HES has a Debt/Equity ratio of 0.76. This is a neutral value indicating HES is somewhat dependend on debt financing.
HES's Debt to Equity ratio of 0.76 is on the low side compared to the rest of the industry. HES is outperformed by 63.81% of its industry peers.
| 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's Current ratio of 1.08 is in line compared 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.
HES has a Quick ratio (0.91) which is in line with its industry peers.
| 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.
HES shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 9.55%.
Measured over the past years, HES shows a quite strong growth in Revenue. The Revenue has been growing by 14.70% on average per year.
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
Based on estimates for the next years, HES will show a quite strong growth in Earnings Per Share. The EPS will grow by 11.19% on average per year.
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
HES is valuated rather expensively with a Price/Earnings ratio of 17.88.
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 26.93, HES is valued a bit cheaper.
HES is valuated rather expensively with a Price/Forward Earnings ratio of 17.97.
HES's Price/Forward Earnings is on the same level as the industry average.
HES's Price/Forward Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 35.31.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 17.88 | ||
| Fwd PE | 17.97 |
4.2 Price Multiples
HES's Enterprise Value to EBITDA is on the same level as 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
The decent profitability rating of HES 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%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 6.34, HES is paying slightly less dividend.
With a Dividend Yield of 1.34, HES pays less dividend than the S&P500 average, which is at 2.39.
| 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 been paying a dividend for at least 10 years, so it has 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 Change-1.51%
Ins Owners8.84%
Ins Owner Change-279.74%
Market Cap46.07B
Analysts74
Price Target164.07 (10.14%)
Short Float %2.49%
Short Ratio3.31
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%