HESS MIDSTREAM LP - CLASS A (HESM) Stock Fundamental Analysis
USA - NYSE:HESM - US4281031058 - Common Stock
33.1 USD
+0.42 (+1.29%)
33.59 USD
+0.49 (+1.48%)
We assign a fundamental rating of 5 out of 10 to HESM. HESM was compared to 211 industry peers in the Oil, Gas & Consumable Fuels industry. HESM has an excellent profitability rating, but there are concerns on its financial health. HESM is not valued too expensively and it also shows a decent growth rate.
1. Profitability
1.1 Basic Checks
HESM had positive earnings in the past year.
HESM had a positive operating cash flow in the past year.
Each year in the past 5 years HESM has been profitable.
HESM had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
HESM's Return On Assets of 6.58% is fine compared to the rest of the industry. HESM outperforms 73.93% of its industry peers.
Looking at the Return On Equity, with a value of 45.81%, HESM belongs to the top of the industry, outperforming 94.31% of the companies in the same industry.
HESM's Return On Invested Capital of 18.25% is amongst the best of the industry. HESM outperforms 95.73% of its industry peers.
HESM had an Average Return On Invested Capital over the past 3 years of 18.24%. This is below the industry average of 21.53%.
The 3 year average ROIC (18.24%) for HESM is below the current ROIC(18.25%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.58% | ||
| ROE | 45.81% | ||
| ROIC | 18.25% |
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 18.52% is fine compared to the rest of the industry. HESM outperforms 72.51% of its industry peers.
In the last couple of years the Profit Margin of HESM has grown nicely.
HESM has a Operating Margin of 61.91%. This is amongst the best in the industry. HESM outperforms 93.84% of its industry peers.
HESM's Operating Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 61.91% | ||
| PM (TTM) | 18.52% | ||
| 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.
The number of shares outstanding for HESM has been reduced compared to 1 year ago.
HESM has less shares outstanding than it did 5 years ago.
Compared to 1 year ago, HESM has an improved debt to assets ratio.
2.2 Solvency
HESM has a debt to FCF ratio of 5.57. This is a neutral value as HESM would need 5.57 years to pay back of all of its debts.
Looking at the Debt to FCF ratio, with a value of 5.57, HESM is in the better half of the industry, outperforming 62.56% of the companies in the same industry.
HESM has a Debt/Equity ratio of 5.81. This is a high value indicating a heavy dependency on external financing.
HESM has a worse Debt to Equity ratio (5.81) than 89.57% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 5.81 | ||
| Debt/FCF | 5.57 | ||
| Altman-Z | N/A |
ROIC/WACC2.32
WACC7.87%
2.3 Liquidity
HESM has a Current Ratio of 0.71. 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 has a Current ratio of 0.71. This is in the lower half of the industry: HESM underperforms 75.83% of its industry peers.
HESM has a Quick Ratio of 0.71. This is a bad value and indicates that HESM is not financially healthy enough and could expect problems in meeting its short term obligations.
Looking at the Quick ratio, with a value of 0.71, HESM is doing worse than 67.77% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.71 | ||
| Quick Ratio | 0.71 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 17.39% 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 9.02% in the past year. This is quite good.
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)9.02%
Revenue growth 3Y7.5%
Revenue growth 5Y12.01%
Sales Q2Q%13.32%
3.2 Future
The Earnings Per Share is expected to grow by 1.50% on average over the next years.
Based on estimates for the next years, HESM will show a small growth in Revenue. The Revenue will grow by 7.79% on average per year.
EPS Next Y15.63%
EPS Next 2Y13.32%
EPS Next 3Y11.84%
EPS Next 5Y1.5%
Revenue Next Year11.51%
Revenue Next 2Y9.27%
Revenue Next 3Y7.79%
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
The Price/Earnings ratio is 12.26, which indicates a correct valuation of HESM.
61.14% of the companies in the same industry are more expensive than HESM, based on the Price/Earnings ratio.
Compared to an average S&P500 Price/Earnings ratio of 27.69, HESM is valued rather cheaply.
The Price/Forward Earnings ratio is 10.35, which indicates a very decent valuation of HESM.
67.30% of the companies in the same industry are more expensive than HESM, based on the Price/Forward Earnings ratio.
Compared to an average S&P500 Price/Forward Earnings ratio of 23.18, HESM is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.26 | ||
| Fwd PE | 10.35 |
4.2 Price Multiples
The rest of the industry has a similar Enterprise Value to EBITDA ratio as HESM.
Based on the Price/Free Cash Flow ratio, HESM is valued a bit cheaper than the industry average as 74.41% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 10.43 | ||
| EV/EBITDA | 9.05 |
4.3 Compensation for Growth
The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
The decent profitability rating of HESM may justify a higher PE ratio.
PEG (NY)0.78
PEG (5Y)0.8
EPS Next 2Y13.32%
EPS Next 3Y11.84%
5. Dividend
5.1 Amount
HESM has a Yearly Dividend Yield of 9.00%, which is a nice return.
Compared to an average industry Dividend Yield of 6.30, HESM pays a better dividend. On top of this HESM pays more dividend than 84.36% of the companies listed in the same industry.
HESM's Dividend Yield is rather good when compared to the S&P500 average which is at 2.34.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 9% |
5.2 History
On average, the dividend of HESM grows each year by 16.02%, which is quite nice.
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
99.14% of the earnings are spent on dividend by HESM. This is not a sustainable payout ratio.
The dividend of HESM is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP99.14%
EPS Next 2Y13.32%
EPS Next 3Y11.84%
33.1
+0.42 (+1.29%)
Chartmill FA Rating
GICS SectorEnergy
GICS IndustryGroupEnergy
GICS IndustryOil, Gas & Consumable Fuels
Earnings (Last)
Earnings (Next)
Inst Owners88.16%
Inst Owner Change-0.98%
Ins Owners0.16%
Ins Owner Change-29.46%
Market Cap6.95B
Analysts72.31
Price Target43.86 (32.51%)
Short Float %4.87%
Short Ratio3.62
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 9% |
Yearly Dividend1.06
Dividend Growth(5Y)16.02%
DP99.14%
Div Incr Years7
Div Non Decr Years7
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)5.99%
Min EPS beat(2)3%
Max EPS beat(2)8.99%
EPS beat(4)2
Avg EPS beat(4)1%
Min EPS beat(4)-6.17%
Max EPS beat(4)8.99%
EPS beat(8)3
Avg EPS beat(8)-3.14%
EPS beat(12)4
Avg EPS beat(12)-3.08%
EPS beat(16)4
Avg EPS beat(16)-4.2%
Revenue beat(2)1
Avg Revenue beat(2)-0.82%
Min Revenue beat(2)-1.87%
Max Revenue beat(2)0.23%
Revenue beat(4)1
Avg Revenue beat(4)-1%
Min Revenue beat(4)-1.87%
Max Revenue beat(4)0.23%
Revenue beat(8)2
Avg Revenue beat(8)-0.68%
Revenue beat(12)3
Avg Revenue beat(12)-0.88%
Revenue beat(16)5
Avg Revenue beat(16)-0.54%
PT rev (1m)-5.7%
PT rev (3m)-2.27%
EPS NQ rev (1m)-3.21%
EPS NQ rev (3m)-6.96%
EPS NY rev (1m)1.33%
EPS NY rev (3m)1.72%
Revenue NQ rev (1m)-2.24%
Revenue NQ rev (3m)-1.74%
Revenue NY rev (1m)-0.59%
Revenue NY rev (3m)0.41%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.26 | ||
| Fwd PE | 10.35 | ||
| P/S | 4.43 | ||
| P/FCF | 10.43 | ||
| P/OCF | 7.22 | ||
| P/B | 10.95 | ||
| P/tB | 10.95 | ||
| EV/EBITDA | 9.05 |
EPS(TTM)2.7
EY8.16%
EPS(NY)3.2
Fwd EY9.66%
FCF(TTM)3.17
FCFY9.58%
OCF(TTM)4.58
OCFY13.85%
SpS7.48
BVpS3.02
TBVpS3.02
PEG (NY)0.78
PEG (5Y)0.8
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.58% | ||
| ROE | 45.81% | ||
| ROCE | 23.1% | ||
| ROIC | 18.25% | ||
| ROICexc | 18.27% | ||
| ROICexgc | 18.27% | ||
| OM | 61.91% | ||
| PM (TTM) | 18.52% | ||
| GM | N/A | ||
| FCFM | 42.43% |
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 | 5.81 | ||
| Debt/FCF | 5.57 | ||
| Debt/EBITDA | 3.13 | ||
| Cap/Depr | 143.76% | ||
| Cap/Sales | 18.87% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 81.7% | ||
| Profit Quality | 229.08% | ||
| Current Ratio | 0.71 | ||
| Quick Ratio | 0.71 | ||
| Altman-Z | N/A |
F-Score7
WACC7.87%
ROIC/WACC2.32
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 Y15.63%
EPS Next 2Y13.32%
EPS Next 3Y11.84%
EPS Next 5Y1.5%
Revenue 1Y (TTM)9.02%
Revenue growth 3Y7.5%
Revenue growth 5Y12.01%
Sales Q2Q%13.32%
Revenue Next Year11.51%
Revenue Next 2Y9.27%
Revenue Next 3Y7.79%
Revenue Next 5YN/A
EBIT growth 1Y11.2%
EBIT growth 3Y8.12%
EBIT growth 5Y19.53%
EBIT Next Year37.29%
EBIT Next 3Y16.33%
EBIT Next 5Y7.62%
FCF growth 1Y6.49%
FCF growth 3Y0.1%
FCF growth 5Y31.01%
OCF growth 1Y11.86%
OCF growth 3Y5.73%
OCF growth 5Y14.84%