HESS MIDSTREAM LP - CLASS A (HESM) Stock Fundamental Analysis
NYSE:HESM - New York Stock Exchange, Inc. - US4281031058 - Common Stock - Currency: USD
HESM gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 213 industry peers in the Oil, Gas & Consumable Fuels industry. HESM has an excellent profitability rating, but there are concerns on its financial health. HESM has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
HESM had positive earnings in the past year.
In the past year HESM had a positive cash flow from operations.
In the past 5 years HESM has always been profitable.
Each year in the past 5 years HESM had a positive operating cash flow.
1.2 Ratios
The Return On Assets of HESM (5.87%) is better than 63.85% of its industry peers.
HESM's Return On Equity of 41.59% is amongst the best of the industry. HESM outperforms 93.43% 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 92.96% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for HESM is significantly below the industry average of 25.73%.
| 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's Profit Margin of 16.43% is fine compared to the rest of the industry. HESM outperforms 65.73% of its industry peers.
In the last couple of years the Profit Margin of HESM has grown nicely.
HESM has a better Operating Margin (61.40%) than 93.43% of its industry peers.
HESM's Operating Margin has improved in the last couple of years.
| 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
With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), HESM is creating value.
Compared to 1 year ago, HESM has less shares outstanding
HESM has less shares outstanding than it did 5 years ago.
HESM has a better debt/assets ratio than last year.
2.2 Solvency
The Debt to FCF ratio of HESM is 5.41, which is a neutral value as it means it would take HESM, 5.41 years of fcf income to pay off all of its debts.
The Debt to FCF ratio of HESM (5.41) is better than 62.91% of its industry peers.
HESM has a Debt/Equity ratio of 5.90. This is a high value indicating a heavy dependency on external financing.
HESM has a Debt to Equity ratio of 5.90. This is amonst the worse of the industry: HESM underperforms 90.14% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 5.9 | ||
| Debt/FCF | 5.41 | ||
| Altman-Z | N/A |
ROIC/WACC1.85
WACC9.81%
2.3 Liquidity
A Current Ratio of 0.81 indicates that HESM may have some problems paying its short term obligations.
Looking at the Current ratio, with a value of 0.81, HESM is doing worse than 68.08% of the companies in the same industry.
HESM has a Quick Ratio of 0.81. This is a bad value and indicates that HESM is not financially healthy enough and could expect problems in meeting its short term obligations.
HESM's Quick ratio of 0.81 is on the low side compared to the rest of the industry. HESM is outperformed by 61.03% of its industry peers.
| 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 15.38% over the past year.
Measured over the past years, HESM shows a quite strong growth in Earnings Per Share. The EPS has been growing by 15.34% on average per year.
The Revenue has grown by 8.77% in the past year. This is quite good.
HESM shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 12.01% yearly.
EPS 1Y (TTM)15.38%
EPS 3Y12.26%
EPS 5Y15.34%
EPS Q2Q%10.17%
Revenue 1Y (TTM)8.77%
Revenue growth 3Y7.5%
Revenue growth 5Y12.01%
Sales Q2Q%7.42%
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 9.32% on average over the next years. This is quite good.
EPS Next Y12.08%
EPS Next 2Y13.88%
EPS Next 3Y12.22%
EPS Next 5Y8.5%
Revenue Next Year10.59%
Revenue Next 2Y10.76%
Revenue Next 3Y9.32%
Revenue Next 5YN/A
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less than in the last 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 14.62, HESM is valued correctly.
HESM's Price/Earnings ratio is in line with the industry average.
When comparing the Price/Earnings ratio of HESM to the average of the S&P500 Index (26.20), we can say HESM is valued slightly cheaper.
HESM is valuated reasonably with a Price/Forward Earnings ratio of 11.54.
The rest of the industry has a similar Price/Forward Earnings ratio as HESM.
Compared to an average S&P500 Price/Forward Earnings ratio of 22.13, HESM is valued a bit cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 14.62 | ||
| Fwd PE | 11.54 |
4.2 Price Multiples
HESM's Enterprise Value to EBITDA ratio is in line with the industry average.
Based on the Price/Free Cash Flow ratio, HESM is valued a bit cheaper than 65.26% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 12.87 | ||
| EV/EBITDA | 10.6 |
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.
A more expensive valuation may be justified as HESM's earnings are expected to grow with 12.22% in the coming years.
PEG (NY)1.21
PEG (5Y)0.95
EPS Next 2Y13.88%
EPS Next 3Y12.22%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 7.47%, HESM is a good candidate for dividend investing.
HESM's Dividend Yield is a higher than the industry average which is at 6.81.
Compared to an average S&P500 Dividend Yield of 2.40, HESM pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 7.47% |
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.
As HESM did not decrease their dividend in the past 5 years, we can say the dividend looks stable.
Dividend Growth(5Y)16.02%
Div Incr Years7
Div Non Decr Years7
5.3 Sustainability
HESM pays out 103.00% of its income as dividend. 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 2Y13.88%
EPS Next 3Y12.22%
37.28
-0.91 (-2.38%)
Chartmill FA Rating
GICS SectorEnergy
GICS IndustryGroupEnergy
GICS IndustryOil, Gas & Consumable Fuels
Earnings (Last)
Earnings (Next)
Inst Owners93.66%
Inst Owner Change12.96%
Ins Owners0.26%
Ins Owner Change3.34%
Market Cap8.50B
Analysts80
Price Target44.88 (20.39%)
Short Float %4.97%
Short Ratio4.85
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 7.47% |
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)-1.68%
PT rev (3m)0%
EPS NQ rev (1m)-8.06%
EPS NQ rev (3m)-3.7%
EPS NY rev (1m)-4.83%
EPS NY rev (3m)-2.96%
Revenue NQ rev (1m)-0.8%
Revenue NQ rev (3m)-1%
Revenue NY rev (1m)-0.77%
Revenue NY rev (3m)-0.41%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 14.62 | ||
| Fwd PE | 11.54 | ||
| P/S | 5.59 | ||
| P/FCF | 12.87 | ||
| P/OCF | 8.88 | ||
| P/B | 14.14 | ||
| P/tB | 14.14 | ||
| EV/EBITDA | 10.6 |
EPS(TTM)2.55
EY6.84%
EPS(NY)3.23
Fwd EY8.66%
FCF(TTM)2.9
FCFY7.77%
OCF(TTM)4.2
OCFY11.26%
SpS6.67
BVpS2.64
TBVpS2.64
PEG (NY)1.21
PEG (5Y)0.95
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
WACC9.81%
ROIC/WACC1.85
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)15.38%
EPS 3Y12.26%
EPS 5Y15.34%
EPS Q2Q%10.17%
EPS Next Y12.08%
EPS Next 2Y13.88%
EPS Next 3Y12.22%
EPS Next 5Y8.5%
Revenue 1Y (TTM)8.77%
Revenue growth 3Y7.5%
Revenue growth 5Y12.01%
Sales Q2Q%7.42%
Revenue Next Year10.59%
Revenue Next 2Y10.76%
Revenue Next 3Y9.32%
Revenue Next 5YN/A
EBIT growth 1Y9.9%
EBIT growth 3Y8.12%
EBIT growth 5Y19.53%
EBIT Next Year35.7%
EBIT Next 3Y16.36%
EBIT Next 5Y11.34%
FCF growth 1Y6.29%
FCF growth 3Y0.1%
FCF growth 5Y31.01%
OCF growth 1Y10.15%
OCF growth 3Y5.73%
OCF growth 5Y14.84%