HESS MIDSTREAM LP - CLASS A (HESM) Stock Fundamental Analysis
NYSE:HESM - New York Stock Exchange, Inc. - US4281031058 - Common Stock - Currency: USD
Overall HESM gets a fundamental rating of 5 out of 10. We evaluated HESM against 208 industry peers in the Oil, Gas & Consumable Fuels industry. HESM scores excellent on profitability, but there are concerns on its financial health. HESM has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
In the past year HESM was profitable.
HESM had a positive operating cash flow in the past year.
HESM had positive earnings in each of the past 5 years.
Each year in the past 5 years HESM had a positive operating cash flow.
1.2 Ratios
With a decent Return On Assets value of 5.87%, HESM is doing good in the industry, outperforming 63.94% of the companies in the same industry.
HESM has a Return On Equity of 41.59%. This is amongst the best in the industry. HESM outperforms 93.75% of its industry peers.
Looking at the Return On Invested Capital, with a value of 18.10%, HESM belongs to the top of the industry, outperforming 94.23% of the companies in the same industry.
HESM had an Average Return On Invested Capital over the past 3 years of 18.24%. This is significantly below the industry average of 23.63%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.87% | ||
| ROE | 41.59% | ||
| ROIC | 18.1% |
ROA(3y)3.61%
ROA(5y)2.58%
ROE(3y)37.04%
ROE(5y)30.61%
ROIC(3y)18.24%
ROIC(5y)17.21%
1.3 Margins
HESM has a Profit Margin of 16.43%. This is in the better half of the industry: HESM outperforms 65.87% of its industry peers.
In the last couple of years the Profit Margin of HESM has grown nicely.
HESM has a Operating Margin of 61.40%. This is amongst the best in the industry. HESM outperforms 93.27% of its industry peers.
In the last couple of years the Operating Margin of HESM has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 61.4% | ||
| PM (TTM) | 16.43% | ||
| GM | N/A |
OM growth 3Y0.57%
OM growth 5Y6.72%
PM growth 3Y57.01%
PM growth 5Y13.67%
GM growth 3YN/A
GM growth 5YN/A
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is well above the Cost of Capital (WACC), so HESM is creating value.
Compared to 1 year ago, HESM has less shares outstanding
Compared to 5 years ago, HESM has less shares outstanding
The debt/assets ratio for HESM has been reduced compared to a year ago.
2.2 Solvency
HESM has a debt to FCF ratio of 5.41. This is a neutral value as HESM would need 5.41 years to pay back of all of its debts.
Looking at the Debt to FCF ratio, with a value of 5.41, HESM is in the better half of the industry, outperforming 60.58% of the companies in the same industry.
HESM has a Debt/Equity ratio of 5.90. This is a high value indicating a heavy dependency on external financing.
HESM has a worse Debt to Equity ratio (5.90) than 89.42% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 5.9 | ||
| Debt/FCF | 5.41 | ||
| Altman-Z | N/A |
ROIC/WACC2.09
WACC8.68%
2.3 Liquidity
A Current Ratio of 0.81 indicates that HESM may have some problems paying its short term obligations.
The Current ratio of HESM (0.81) is worse than 69.23% of its industry peers.
A Quick Ratio of 0.81 indicates that HESM may have some problems paying its short term obligations.
Looking at the Quick ratio, with a value of 0.81, HESM is doing worse than 61.06% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.81 | ||
| Quick Ratio | 0.81 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 17.39% over the past year.
HESM shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 15.34% yearly.
HESM shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 10.89%.
The Revenue has been growing by 12.01% on average over the past years. This is quite good.
EPS 1Y (TTM)17.39%
EPS 3Y12.26%
EPS 5Y15.34%
EPS Q2Q%25.42%
Revenue 1Y (TTM)10.89%
Revenue growth 3Y7.5%
Revenue growth 5Y12.01%
Sales Q2Q%13.32%
3.2 Future
The Earnings Per Share is expected to grow by 8.50% on average over the next years. This is quite good.
The Revenue is expected to grow by 9.72% on average over the next years. This is quite good.
EPS Next Y13.67%
EPS Next 2Y15.29%
EPS Next 3Y13.36%
EPS Next 5Y8.5%
Revenue Next Year11.11%
Revenue Next 2Y11.3%
Revenue Next 3Y9.72%
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.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 15.42 indicates a correct valuation of HESM.
HESM's Price/Earnings is on the same level as the industry average.
Compared to an average S&P500 Price/Earnings ratio of 26.48, HESM is valued a bit cheaper.
The Price/Forward Earnings ratio is 12.58, which indicates a correct valuation of HESM.
Compared to the rest of the industry, the Price/Forward Earnings ratio of HESM is on the same level as its industry peers.
The average S&P500 Price/Forward Earnings ratio is at 34.04. HESM is valued rather cheaply when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.42 | ||
| Fwd PE | 12.58 |
4.2 Price Multiples
HESM's Enterprise Value to EBITDA is on the same level as the industry average.
65.38% of the companies in the same industry are more expensive than HESM, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 13.24 | ||
| EV/EBITDA | 10.69 |
4.3 Compensation for Growth
HESM's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
The decent profitability rating of HESM may justify a higher PE ratio.
HESM's earnings are expected to grow with 13.36% in the coming years. This may justify a more expensive valuation.
PEG (NY)1.13
PEG (5Y)1.01
EPS Next 2Y15.29%
EPS Next 3Y13.36%
5. Dividend
5.1 Amount
HESM has a Yearly Dividend Yield of 7.05%, which is a nice return.
Compared to an average industry Dividend Yield of 6.34, HESM pays a bit more dividend than its industry peers.
Compared to an average S&P500 Dividend Yield of 2.40, HESM pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 7.05% |
5.2 History
The dividend of HESM is nicely growing with an annual growth rate of 16.02%!
HESM has been paying a dividend for over 5 years, so it has already some track record.
HESM has not decreased its dividend in the past 5 years, so it has a somewhat stable track record.
Dividend Growth(5Y)16.02%
Div Incr Years7
Div Non Decr Years7
5.3 Sustainability
103.00% of the earnings are spent on dividend by HESM. This is not a sustainable payout ratio.
HESM's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP103%
EPS Next 2Y15.29%
EPS Next 3Y13.36%
41.64
+0.62 (+1.51%)
Chartmill FA Rating
GICS SectorEnergy
GICS IndustryGroupEnergy
GICS IndustryOil, Gas & Consumable Fuels
Earnings (Last)
Earnings (Next)
Inst Owners93.8%
Inst Owner Change0.65%
Ins Owners0.24%
Ins Owner Change1.94%
Market Cap8.75B
Analysts80
Price Target47.12 (13.16%)
Short Float %5.65%
Short Ratio4.38
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 7.05% |
Yearly Dividend1.06
Dividend Growth(5Y)16.02%
DP103%
Div Incr Years7
Div Non Decr Years7
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)0.59%
Min EPS beat(2)-1.82%
Max EPS beat(2)3%
EPS beat(4)1
Avg EPS beat(4)-3.44%
Min EPS beat(4)-8.76%
Max EPS beat(4)3%
EPS beat(8)3
Avg EPS beat(8)-3.96%
EPS beat(12)3
Avg EPS beat(12)-4.27%
EPS beat(16)3
Avg EPS beat(16)-4.78%
Revenue beat(2)0
Avg Revenue beat(2)-1.34%
Min Revenue beat(2)-1.87%
Max Revenue beat(2)-0.81%
Revenue beat(4)0
Avg Revenue beat(4)-1.53%
Min Revenue beat(4)-1.87%
Max Revenue beat(4)-0.81%
Revenue beat(8)1
Avg Revenue beat(8)-0.9%
Revenue beat(12)2
Avg Revenue beat(12)-0.93%
Revenue beat(16)4
Avg Revenue beat(16)-0.66%
PT rev (1m)0%
PT rev (3m)-1.68%
EPS NQ rev (1m)1.37%
EPS NQ rev (3m)-3.92%
EPS NY rev (1m)0%
EPS NY rev (3m)-3.48%
Revenue NQ rev (1m)0.01%
Revenue NQ rev (3m)-0.36%
Revenue NY rev (1m)0.06%
Revenue NY rev (3m)-0.29%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.42 | ||
| Fwd PE | 12.58 | ||
| P/S | 5.75 | ||
| P/FCF | 13.24 | ||
| P/OCF | 9.14 | ||
| P/B | 14.55 | ||
| P/tB | 14.55 | ||
| EV/EBITDA | 10.69 |
EPS(TTM)2.7
EY6.48%
EPS(NY)3.31
Fwd EY7.95%
FCF(TTM)3.14
FCFY7.55%
OCF(TTM)4.56
OCFY10.95%
SpS7.25
BVpS2.86
TBVpS2.86
PEG (NY)1.13
PEG (5Y)1.01
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.87% | ||
| ROE | 41.59% | ||
| ROCE | 22.92% | ||
| ROIC | 18.1% | ||
| ROICexc | 18.13% | ||
| ROICexgc | 18.13% | ||
| OM | 61.4% | ||
| PM (TTM) | 16.43% | ||
| GM | N/A | ||
| FCFM | 43.41% |
ROA(3y)3.61%
ROA(5y)2.58%
ROE(3y)37.04%
ROE(5y)30.61%
ROIC(3y)18.24%
ROIC(5y)17.21%
ROICexc(3y)18.26%
ROICexc(5y)17.23%
ROICexgc(3y)18.26%
ROICexgc(5y)17.23%
ROCE(3y)23.09%
ROCE(5y)21.79%
ROICexcg growth 3Y2.15%
ROICexcg growth 5Y14%
ROICexc growth 3Y2.15%
ROICexc growth 5Y14%
OM growth 3Y0.57%
OM growth 5Y6.72%
PM growth 3Y57.01%
PM growth 5Y13.67%
GM growth 3YN/A
GM growth 5YN/A
F-Score7
Asset Turnover0.36
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 5.9 | ||
| Debt/FCF | 5.41 | ||
| Debt/EBITDA | 3.11 | ||
| Cap/Depr | 144.92% | ||
| Cap/Sales | 19.5% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 84.04% | ||
| Profit Quality | 264.13% | ||
| Current Ratio | 0.81 | ||
| Quick Ratio | 0.81 | ||
| Altman-Z | N/A |
F-Score7
WACC8.68%
ROIC/WACC2.09
Cap/Depr(3y)132.73%
Cap/Depr(5y)137.73%
Cap/Sales(3y)18.57%
Cap/Sales(5y)19.37%
Profit Quality(3y)522.92%
Profit Quality(5y)870.13%
High Growth Momentum
Growth
EPS 1Y (TTM)17.39%
EPS 3Y12.26%
EPS 5Y15.34%
EPS Q2Q%25.42%
EPS Next Y13.67%
EPS Next 2Y15.29%
EPS Next 3Y13.36%
EPS Next 5Y8.5%
Revenue 1Y (TTM)10.89%
Revenue growth 3Y7.5%
Revenue growth 5Y12.01%
Sales Q2Q%13.32%
Revenue Next Year11.11%
Revenue Next 2Y11.3%
Revenue Next 3Y9.72%
Revenue Next 5YN/A
EBIT growth 1Y9.9%
EBIT growth 3Y8.12%
EBIT growth 5Y19.53%
EBIT Next Year36.76%
EBIT Next 3Y16.98%
EBIT Next 5Y10.39%
FCF growth 1Y6.29%
FCF growth 3Y0.1%
FCF growth 5Y31.01%
OCF growth 1Y10.15%
OCF growth 3Y5.73%
OCF growth 5Y14.84%