HERC HOLDINGS INC (HRI) Stock Fundamental Analysis
NYSE:HRI - New York Stock Exchange, Inc. - US42704L1044 - Common Stock - Currency: USD
HRI gets a fundamental rating of 4 out of 10. The analysis compared the fundamentals against 48 industry peers in the Trading Companies & Distributors industry. There are concerns on the financial health of HRI while its profitability can be described as average. HRI has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
HRI had positive earnings in the past year.
HRI had a positive operating cash flow in the past year.
HRI had positive earnings in each of the past 5 years.
In the past 5 years HRI always reported a positive cash flow from operatings.
1.2 Ratios
HRI has a worse Return On Assets (1.66%) than 64.58% of its industry peers.
HRI's Return On Equity of 9.43% is in line compared to the rest of the industry. HRI outperforms 41.67% of its industry peers.
HRI has a Return On Invested Capital (7.56%) which is in line with its industry peers.
The Average Return On Invested Capital over the past 3 years for HRI is in line with the industry average of 9.38%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.66% | ||
| ROE | 9.43% | ||
| ROIC | 7.56% |
ROA(3y)4.38%
ROA(5y)4.04%
ROE(3y)24.04%
ROE(5y)21%
ROIC(3y)7.69%
ROIC(5y)7%
1.3 Margins
HRI has a Profit Margin (3.53%) which is in line with its industry peers.
In the last couple of years the Profit Margin of HRI has grown nicely.
HRI's Operating Margin of 20.11% is amongst the best of the industry. HRI outperforms 87.50% of its industry peers.
In the last couple of years the Operating Margin of HRI has grown nicely.
The Gross Margin of HRI (60.52%) is better than 93.75% of its industry peers.
In the last couple of years the Gross Margin of HRI has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 20.11% | ||
| PM (TTM) | 3.53% | ||
| GM | 60.52% |
OM growth 3Y4.56%
OM growth 5Y10.96%
PM growth 3Y-18.21%
PM growth 5Y20%
GM growth 3Y1.25%
GM growth 5Y3.11%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), HRI is destroying value.
HRI has more shares outstanding than it did 1 year ago.
HRI has less shares outstanding than it did 5 years ago.
Compared to 1 year ago, HRI has an improved debt to assets ratio.
2.2 Solvency
Based on the Altman-Z score of 1.27, we must say that HRI is in the distress zone and has some risk of bankruptcy.
With a Altman-Z score value of 1.27, HRI is not doing good in the industry: 77.08% of the companies in the same industry are doing better.
A Debt/Equity ratio of 3.04 is on the high side and indicates that HRI has dependencies on debt financing.
HRI has a Debt to Equity ratio of 3.04. This is amonst the worse of the industry: HRI underperforms 85.42% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 3.04 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 1.27 |
ROIC/WACC0.79
WACC9.55%
2.3 Liquidity
HRI has a Current Ratio of 1.50. This is a normal value and indicates that HRI is financially healthy and should not expect problems in meeting its short term obligations.
HRI's Current ratio of 1.50 is on the low side compared to the rest of the industry. HRI is outperformed by 68.75% of its industry peers.
HRI has a Quick Ratio of 1.50. This is a normal value and indicates that HRI is financially healthy and should not expect problems in meeting its short term obligations.
HRI's Quick ratio of 1.50 is fine compared to the rest of the industry. HRI outperforms 62.50% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.5 | ||
| Quick Ratio | 1.5 |
3. Growth
3.1 Past
The earnings per share for HRI have decreased by -3.74% in the last year.
Measured over the past years, HRI shows a very strong growth in Earnings Per Share. The EPS has been growing by 48.42% on average per year.
The Revenue has grown by 8.34% in the past year. This is quite good.
The Revenue has been growing by 12.29% on average over the past years. This is quite good.
EPS 1Y (TTM)-3.74%
EPS 3Y19.73%
EPS 5Y48.42%
EPS Q2Q%-44.92%
Revenue 1Y (TTM)8.34%
Revenue growth 3Y19.84%
Revenue growth 5Y12.29%
Sales Q2Q%7.09%
3.2 Future
Based on estimates for the next years, HRI will show a quite strong growth in Earnings Per Share. The EPS will grow by 10.33% on average per year.
Based on estimates for the next years, HRI will show a small growth in Revenue. The Revenue will grow by 5.29% on average per year.
EPS Next Y-1.24%
EPS Next 2Y8.57%
EPS Next 3Y10.4%
EPS Next 5Y10.33%
Revenue Next Year3.03%
Revenue Next 2Y3.43%
Revenue Next 3Y3.52%
Revenue Next 5Y5.29%
3.3 Evolution
Although the future EPS growth is still strong, it is not able to hold up the even more excellent growth rate of 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
A Price/Earnings ratio of 10.48 indicates a reasonable valuation of HRI.
87.50% of the companies in the same industry are more expensive than HRI, based on the Price/Earnings ratio.
Compared to an average S&P500 Price/Earnings ratio of 26.19, HRI is valued rather cheaply.
With a Price/Forward Earnings ratio of 8.16, the valuation of HRI can be described as very reasonable.
Based on the Price/Forward Earnings ratio, HRI is valued cheaply inside the industry as 87.50% of the companies are valued more expensively.
HRI's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 22.13.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 10.48 | ||
| Fwd PE | 8.16 |
4.2 Price Multiples
97.92% of the companies in the same industry are more expensive than HRI, based on the Enterprise Value to EBITDA ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 5.01 |
4.3 Compensation for Growth
The decent profitability rating of HRI may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)0.22
EPS Next 2Y8.57%
EPS Next 3Y10.4%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 2.24%, HRI has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 2.74, HRI pays a better dividend. On top of this HRI pays more dividend than 85.42% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 2.40, HRI has a dividend comparable with the average S&P500 company.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.24% |
5.2 History
HRI has been paying a dividend for over 5 years, so it has already some track record.
HRI has decreased its dividend in the last 3 years.
Dividend Growth(5Y)N/A
Div Incr Years2
Div Non Decr Years2
5.3 Sustainability
HRI pays out 60.94% of its income as dividend. This is not a sustainable payout ratio.
DP60.94%
EPS Next 2Y8.57%
EPS Next 3Y10.4%
124
-4.3 (-3.35%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryTrading Companies & Distributors
Earnings (Last)
Earnings (Next)
Inst Owners98.64%
Inst Owner Change5.59%
Ins Owners1.19%
Ins Owner Change4.81%
Market Cap3.53B
Analysts75.71
Price Target178.63 (44.06%)
Short Float %8.69%
Short Ratio4.25
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.24% |
Yearly Dividend2.72
Dividend Growth(5Y)N/A
DP60.94%
Div Incr Years2
Div Non Decr Years2
Ex-Date
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-26.13%
Min EPS beat(2)-42.15%
Max EPS beat(2)-10.11%
EPS beat(4)0
Avg EPS beat(4)-16.9%
Min EPS beat(4)-42.15%
Max EPS beat(4)-3.79%
EPS beat(8)1
Avg EPS beat(8)-10.72%
EPS beat(12)2
Avg EPS beat(12)-7.68%
EPS beat(16)4
Avg EPS beat(16)-4.26%
Revenue beat(2)2
Avg Revenue beat(2)1.13%
Min Revenue beat(2)0.38%
Max Revenue beat(2)1.87%
Revenue beat(4)4
Avg Revenue beat(4)1.44%
Min Revenue beat(4)0.38%
Max Revenue beat(4)2.59%
Revenue beat(8)6
Avg Revenue beat(8)0.1%
Revenue beat(12)9
Avg Revenue beat(12)0.31%
Revenue beat(16)11
Avg Revenue beat(16)0.46%
PT rev (1m)-0.71%
PT rev (3m)-24.33%
EPS NQ rev (1m)-3.14%
EPS NQ rev (3m)-12.63%
EPS NY rev (1m)-3.29%
EPS NY rev (3m)-4.11%
Revenue NQ rev (1m)-1.78%
Revenue NQ rev (3m)-2.32%
Revenue NY rev (1m)-0.43%
Revenue NY rev (3m)-1.29%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 10.48 | ||
| Fwd PE | 8.16 | ||
| P/S | 0.97 | ||
| P/FCF | N/A | ||
| P/OCF | 3.06 | ||
| P/B | 2.6 | ||
| P/tB | 31.55 | ||
| EV/EBITDA | 5.01 |
EPS(TTM)11.83
EY9.54%
EPS(NY)15.19
Fwd EY12.25%
FCF(TTM)-2.18
FCFYN/A
OCF(TTM)40.56
OCFY32.71%
SpS127.19
BVpS47.65
TBVpS3.93
PEG (NY)N/A
PEG (5Y)0.22
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.66% | ||
| ROE | 9.43% | ||
| ROCE | 10.08% | ||
| ROIC | 7.56% | ||
| ROICexc | 7.61% | ||
| ROICexgc | 9.21% | ||
| OM | 20.11% | ||
| PM (TTM) | 3.53% | ||
| GM | 60.52% | ||
| FCFM | N/A |
ROA(3y)4.38%
ROA(5y)4.04%
ROE(3y)24.04%
ROE(5y)21%
ROIC(3y)7.69%
ROIC(5y)7%
ROICexc(3y)7.77%
ROICexc(5y)7.07%
ROICexgc(3y)9.25%
ROICexgc(5y)8.36%
ROCE(3y)10.24%
ROCE(5y)9.32%
ROICexcg growth 3Y2.77%
ROICexcg growth 5Y9.04%
ROICexc growth 3Y2.21%
ROICexc growth 5Y7.51%
OM growth 3Y4.56%
OM growth 5Y10.96%
PM growth 3Y-18.21%
PM growth 5Y20%
GM growth 3Y1.25%
GM growth 5Y3.11%
F-Score4
Asset Turnover0.47
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 3.04 | ||
| Debt/FCF | N/A | ||
| Debt/EBITDA | 2.66 | ||
| Cap/Depr | 148.18% | ||
| Cap/Sales | 33.6% | ||
| Interest Coverage | 2.96 | ||
| Cash Conversion | 74.53% | ||
| Profit Quality | N/A | ||
| Current Ratio | 1.5 | ||
| Quick Ratio | 1.5 | ||
| Altman-Z | 1.27 |
F-Score4
WACC9.55%
ROIC/WACC0.79
Cap/Depr(3y)182.39%
Cap/Depr(5y)152.23%
Cap/Sales(3y)41.77%
Cap/Sales(5y)35.58%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-3.74%
EPS 3Y19.73%
EPS 5Y48.42%
EPS Q2Q%-44.92%
EPS Next Y-1.24%
EPS Next 2Y8.57%
EPS Next 3Y10.4%
EPS Next 5Y10.33%
Revenue 1Y (TTM)8.34%
Revenue growth 3Y19.84%
Revenue growth 5Y12.29%
Sales Q2Q%7.09%
Revenue Next Year3.03%
Revenue Next 2Y3.43%
Revenue Next 3Y3.52%
Revenue Next 5Y5.29%
EBIT growth 1Y7.21%
EBIT growth 3Y25.3%
EBIT growth 5Y24.59%
EBIT Next Year109.75%
EBIT Next 3Y32.73%
EBIT Next 5Y25.96%
FCF growth 1Y81.14%
FCF growth 3Y-46.1%
FCF growth 5YN/A
OCF growth 1Y14.6%
OCF growth 3Y18.08%
OCF growth 5Y14.02%