HERC HOLDINGS INC (HRI) Stock Fundamental Analysis
NYSE:HRI - New York Stock Exchange, Inc. - US42704L1044 - Common Stock - Currency: USD
Taking everything into account, HRI scores 5 out of 10 in our fundamental rating. HRI was compared to 50 industry peers in the Trading Companies & Distributors industry. While HRI has a great profitability rating, there are quite some concerns on its financial health. HRI is not valued too expensively and it also shows a decent growth rate.
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.
In the past 5 years HRI has always been profitable.
HRI had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
With a Return On Assets value of 2.68%, HRI is not doing good in the industry: 60.00% of the companies in the same industry are doing better.
HRI's Return On Equity of 15.11% is fine compared to the rest of the industry. HRI outperforms 62.00% of its industry peers.
HRI's Return On Invested Capital of 7.62% is in line compared to the rest of the industry. HRI outperforms 56.00% of its industry peers.
The Average Return On Invested Capital over the past 3 years for HRI is in line with the industry average of 9.15%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.68% | ||
| ROE | 15.11% | ||
| ROIC | 7.62% |
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
Looking at the Profit Margin, with a value of 5.91%, HRI is in the better half of the industry, outperforming 64.00% of the companies in the same industry.
In the last couple of years the Profit Margin of HRI has grown nicely.
HRI has a Operating Margin of 20.82%. This is amongst the best in the industry. HRI outperforms 88.00% of its industry peers.
In the last couple of years the Operating Margin of HRI has grown nicely.
Looking at the Gross Margin, with a value of 61.29%, HRI belongs to the top of the industry, outperforming 94.00% of the companies in the same industry.
In the last couple of years the Gross Margin of HRI has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 20.82% | ||
| PM (TTM) | 5.91% | ||
| GM | 61.29% |
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.
Compared to 1 year ago, HRI has more shares outstanding
HRI has less shares outstanding than it did 5 years ago.
The debt/assets ratio for HRI has been reduced compared to a year ago.
2.2 Solvency
HRI has an Altman-Z score of 1.21. This is a bad value and indicates that HRI is not financially healthy and even has some risk of bankruptcy.
Looking at the Altman-Z score, with a value of 1.21, HRI is doing worse than 78.00% of the companies in the same industry.
HRI has a debt to FCF ratio of 261.94. This is a negative value and a sign of low solvency as HRI would need 261.94 years to pay back of all of its debts.
HRI has a worse Debt to FCF ratio (261.94) than 62.00% of its industry peers.
HRI has a Debt/Equity ratio of 2.99. This is a high value indicating a heavy dependency on external financing.
HRI has a worse Debt to Equity ratio (2.99) than 86.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.99 | ||
| Debt/FCF | 261.94 | ||
| Altman-Z | 1.21 |
ROIC/WACC0.83
WACC9.2%
2.3 Liquidity
HRI has a Current Ratio of 1.38. This is a normal value and indicates that HRI is financially healthy and should not expect problems in meeting its short term obligations.
The Current ratio of HRI (1.38) is worse than 70.00% of its industry peers.
A Quick Ratio of 1.38 indicates that HRI should not have too much problems paying its short term obligations.
HRI has a Quick ratio (1.38) which is in line with its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.38 | ||
| Quick Ratio | 1.38 |
3. Growth
3.1 Past
HRI shows a slight negative growth in Earnings Per Share. In the last year, the EPS has decreased by -3.74%.
HRI shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 48.42% yearly.
HRI shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 8.71%.
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)8.71%
Revenue growth 3Y19.84%
Revenue growth 5Y12.29%
Sales Q2Q%4.98%
3.2 Future
HRI is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 10.33% yearly.
The Revenue is expected to grow by 5.29% on average over the next years.
EPS Next Y2.13%
EPS Next 2Y9.39%
EPS Next 3Y12.12%
EPS Next 5Y10.33%
Revenue Next Year3.48%
Revenue Next 2Y4.03%
Revenue Next 3Y4.93%
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.
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
A Price/Earnings ratio of 9.64 indicates a reasonable valuation of HRI.
88.00% of the companies in the same industry are more expensive than HRI, based on the Price/Earnings ratio.
HRI is valuated cheaply when we compare the Price/Earnings ratio to 23.99, which is the current average of the S&P500 Index.
With a Price/Forward Earnings ratio of 7.39, the valuation of HRI can be described as very cheap.
Compared to the rest of the industry, the Price/Forward Earnings ratio of HRI indicates a rather cheap valuation: HRI is cheaper than 92.00% of the companies listed in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 20.35, HRI is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.64 | ||
| Fwd PE | 7.39 |
4.2 Price Multiples
96.00% of the companies in the same industry are more expensive than HRI, based on the Enterprise Value to EBITDA ratio.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of HRI indicates a slightly more expensive valuation: HRI is more expensive than 62.00% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 203.13 | ||
| EV/EBITDA | 4.72 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
The decent profitability rating of HRI may justify a higher PE ratio.
HRI's earnings are expected to grow with 12.12% in the coming years. This may justify a more expensive valuation.
PEG (NY)4.53
PEG (5Y)0.2
EPS Next 2Y9.39%
EPS Next 3Y12.12%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 2.51%, HRI has a reasonable but not impressive dividend return.
The stock price of HRI dropped by -44.37% in the last 3 months. With lower prices the dividend yield is higher, but it may be a sign investors do not trust the long term dividend.
HRI's Dividend Yield is rather good when compared to the industry average which is at 2.92. HRI pays more dividend than 86.00% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 2.44, HRI has a dividend comparable with the average S&P500 company.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.51% |
5.2 History
HRI has been paying a dividend for over 5 years, so it has already some track record.
The dividend of HRI decreased in the last 3 years.
Dividend Growth(5Y)N/A
Div Incr Years2
Div Non Decr Years2
5.3 Sustainability
HRI pays out 36.49% of its income as dividend. This is a sustainable payout ratio.
DP36.49%
EPS Next 2Y9.39%
EPS Next 3Y12.12%
114.04
+1.53 (+1.36%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryTrading Companies & Distributors
Earnings (Last)
Earnings (Next)
Inst Owners98.64%
Inst Owner Change-2.06%
Ins Owners1.19%
Ins Owner Change-3.71%
Market Cap3.25B
Analysts75.71
Price Target179.9 (57.75%)
Short Float %8.22%
Short Ratio3.51
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.51% |
Yearly Dividend2.72
Dividend Growth(5Y)N/A
DP36.49%
Div Incr Years2
Div Non Decr Years2
Ex-Date
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-6.95%
Min EPS beat(2)-10.11%
Max EPS beat(2)-3.79%
EPS beat(4)1
Avg EPS beat(4)-4.18%
Min EPS beat(4)-11.54%
Max EPS beat(4)8.72%
EPS beat(8)2
Avg EPS beat(8)-4.38%
EPS beat(12)2
Avg EPS beat(12)-4.3%
EPS beat(16)5
Avg EPS beat(16)18.9%
Revenue beat(2)2
Avg Revenue beat(2)2.23%
Min Revenue beat(2)1.87%
Max Revenue beat(2)2.59%
Revenue beat(4)4
Avg Revenue beat(4)1.76%
Min Revenue beat(4)0.91%
Max Revenue beat(4)2.59%
Revenue beat(8)5
Avg Revenue beat(8)0.05%
Revenue beat(12)9
Avg Revenue beat(12)0.39%
Revenue beat(16)11
Avg Revenue beat(16)0.83%
PT rev (1m)-18.56%
PT rev (3m)-27.42%
EPS NQ rev (1m)1.9%
EPS NQ rev (3m)-6.9%
EPS NY rev (1m)-0.71%
EPS NY rev (3m)-11.98%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0.32%
Revenue NY rev (1m)-0.51%
Revenue NY rev (3m)-3.07%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.64 | ||
| Fwd PE | 7.39 | ||
| P/S | 0.91 | ||
| P/FCF | 203.13 | ||
| P/OCF | 2.65 | ||
| P/B | 2.33 | ||
| P/tB | 21.1 | ||
| EV/EBITDA | 4.72 |
EPS(TTM)11.83
EY10.37%
EPS(NY)15.42
Fwd EY13.52%
FCF(TTM)0.56
FCFY0.49%
OCF(TTM)42.98
OCFY37.69%
SpS125.19
BVpS48.98
TBVpS5.4
PEG (NY)4.53
PEG (5Y)0.2
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.68% | ||
| ROE | 15.11% | ||
| ROCE | 10.16% | ||
| ROIC | 7.62% | ||
| ROICexc | 7.71% | ||
| ROICexgc | 9.31% | ||
| OM | 20.82% | ||
| PM (TTM) | 5.91% | ||
| GM | 61.29% | ||
| FCFM | 0.45% |
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-Score5
Asset Turnover0.45
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.99 | ||
| Debt/FCF | 261.94 | ||
| Debt/EBITDA | 2.69 | ||
| Cap/Depr | 150% | ||
| Cap/Sales | 33.88% | ||
| Interest Coverage | 2.88 | ||
| Cash Conversion | 79.08% | ||
| Profit Quality | 7.58% | ||
| Current Ratio | 1.38 | ||
| Quick Ratio | 1.38 | ||
| Altman-Z | 1.21 |
F-Score5
WACC9.2%
ROIC/WACC0.83
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 Y2.13%
EPS Next 2Y9.39%
EPS Next 3Y12.12%
EPS Next 5Y10.33%
Revenue 1Y (TTM)8.71%
Revenue growth 3Y19.84%
Revenue growth 5Y12.29%
Sales Q2Q%4.98%
Revenue Next Year3.48%
Revenue Next 2Y4.03%
Revenue Next 3Y4.93%
Revenue Next 5Y5.29%
EBIT growth 1Y12.07%
EBIT growth 3Y25.3%
EBIT growth 5Y24.59%
EBIT Next Year115.96%
EBIT Next 3Y35.64%
EBIT Next 5Y25.96%
FCF growth 1Y104.1%
FCF growth 3Y-46.1%
FCF growth 5YN/A
OCF growth 1Y12.8%
OCF growth 3Y18.08%
OCF growth 5Y14.02%