HireRight Holdings Corporation (HRT) Stock Fundamental Analysis
NYSE:HRT - New York Stock Exchange, Inc. - US4335371070 - Common Stock - Currency: USD
HRT gets a fundamental rating of 3 out of 10. The analysis compared the fundamentals against 82 industry peers in the Professional Services industry. There are concerns on the financial health of HRT while its profitability can be described as average. HRT is cheap, but on the other hand it scores bad on growth.
1. Profitability
1.1 Basic Checks
HRT had positive earnings in the past year.
In the past year HRT had a positive cash flow from operations.
HRT had negative earnings in 4 of the past 5 years.
HRT had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
HRT's Return On Assets of -0.46% is on the low side compared to the rest of the industry. HRT is outperformed by 64.63% of its industry peers.
HRT's Return On Equity of -1.55% is on the low side compared to the rest of the industry. HRT is outperformed by 67.07% of its industry peers.
The Return On Invested Capital of HRT (4.90%) is comparable to the rest of the industry.
The Average Return On Invested Capital over the past 3 years for HRT is significantly below the industry average of 13.34%.
The 3 year average ROIC (4.42%) for HRT is below the current ROIC(4.90%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -0.46% | ||
| ROE | -1.55% | ||
| ROIC | 4.9% |
ROA(3y)2.29%
ROA(5y)-0.83%
ROE(3y)6.03%
ROE(5y)-7.45%
ROIC(3y)4.42%
ROIC(5y)3.25%
1.3 Margins
With an excellent Operating Margin value of 11.85%, HRT belongs to the best of the industry, outperforming 82.93% of the companies in the same industry.
In the last couple of years the Operating Margin of HRT has grown nicely.
The Gross Margin of HRT (48.75%) is comparable to the rest of the industry.
In the last couple of years the Gross Margin of HRT has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 11.85% | ||
| PM (TTM) | N/A | ||
| GM | 48.75% |
OM growth 3Y70.3%
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y3.2%
GM growth 5YN/A
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), HRT is destroying value.
HRT has less shares outstanding than it did 1 year ago.
HRT has a worse debt/assets ratio than last year.
2.2 Solvency
HRT has an Altman-Z score of 1.08. This is a bad value and indicates that HRT is not financially healthy and even has some risk of bankruptcy.
The Altman-Z score of HRT (1.08) is worse than 71.95% of its industry peers.
HRT has a debt to FCF ratio of 10.42. This is a negative value and a sign of low solvency as HRT would need 10.42 years to pay back of all of its debts.
HRT has a worse Debt to FCF ratio (10.42) than 63.41% of its industry peers.
A Debt/Equity ratio of 1.61 is on the high side and indicates that HRT has dependencies on debt financing.
With a Debt to Equity ratio value of 1.61, HRT is not doing good in the industry: 85.37% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.61 | ||
| Debt/FCF | 10.42 | ||
| Altman-Z | 1.08 |
ROIC/WACC0.54
WACC9.02%
2.3 Liquidity
A Current Ratio of 1.76 indicates that HRT should not have too much problems paying its short term obligations.
Looking at the Current ratio, with a value of 1.76, HRT is in the better half of the industry, outperforming 63.41% of the companies in the same industry.
HRT has a Quick Ratio of 1.76. This is a normal value and indicates that HRT is financially healthy and should not expect problems in meeting its short term obligations.
HRT's Quick ratio of 1.76 is fine compared to the rest of the industry. HRT outperforms 63.41% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.76 | ||
| Quick Ratio | 1.76 |
3. Growth
3.1 Past
HRT shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -53.25%.
The Revenue has decreased by -8.14% in the past year.
The Revenue has been growing by 10.15% on average over the past years. This is quite good.
EPS 1Y (TTM)-53.25%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%22.22%
Revenue 1Y (TTM)-8.14%
Revenue growth 3Y10.15%
Revenue growth 5YN/A
Sales Q2Q%-1.28%
3.2 Future
Based on estimates for the next years, HRT will show a very strong growth in Earnings Per Share. The EPS will grow by 23.89% on average per year.
The Revenue is expected to grow by 6.63% on average over the next years.
EPS Next Y22.84%
EPS Next 2Y27.37%
EPS Next 3Y23.89%
EPS Next 5YN/A
Revenue Next Year4.35%
Revenue Next 2Y7.18%
Revenue Next 3Y6.63%
Revenue Next 5YN/A
3.3 Evolution
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
HRT is valuated correctly with a Price/Earnings ratio of 12.49.
82.93% of the companies in the same industry are more expensive than HRT, based on the Price/Earnings ratio.
HRT's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 24.29.
HRT is valuated cheaply with a Price/Forward Earnings ratio of 7.97.
Based on the Price/Forward Earnings ratio, HRT is valued cheaper than 93.90% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of HRT to the average of the S&P500 Index (20.42), we can say HRT is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.49 | ||
| Fwd PE | 7.97 |
4.2 Price Multiples
76.83% of the companies in the same industry are more expensive than HRT, based on the Enterprise Value to EBITDA ratio.
79.27% of the companies in the same industry are more expensive than HRT, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 13.78 | ||
| EV/EBITDA | 9.64 |
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.
HRT's earnings are expected to grow with 23.89% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.55
PEG (5Y)N/A
EPS Next 2Y27.37%
EPS Next 3Y23.89%
5. Dividend
5.1 Amount
No dividends for HRT!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
14.36
-0.02 (-0.14%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCommercial & Professional Services
GICS IndustryProfessional Services
Earnings (Last)
Earnings (Next)
Inst Owners1.42%
Inst Owner Change0%
Ins Owners11.66%
Ins Owner Change0%
Market Cap967.15M
Analysts46.67
Price Target14.37 (0.07%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Yearly DividendN/A
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)8.84%
Min EPS beat(2)5.74%
Max EPS beat(2)11.94%
EPS beat(4)3
Avg EPS beat(4)5.01%
Min EPS beat(4)-3.39%
Max EPS beat(4)11.94%
EPS beat(8)6
Avg EPS beat(8)37.54%
EPS beat(12)N/A
Avg EPS beat(12)N/A
EPS beat(16)N/A
Avg EPS beat(16)N/A
Revenue beat(2)0
Avg Revenue beat(2)-3.25%
Min Revenue beat(2)-3.53%
Max Revenue beat(2)-2.98%
Revenue beat(4)1
Avg Revenue beat(4)-1.69%
Min Revenue beat(4)-3.53%
Max Revenue beat(4)0.22%
Revenue beat(8)4
Avg Revenue beat(8)0.51%
Revenue beat(12)N/A
Avg Revenue beat(12)N/A
Revenue beat(16)N/A
Avg Revenue beat(16)N/A
PT rev (1m)5.62%
PT rev (3m)5.62%
EPS NQ rev (1m)-10.53%
EPS NQ rev (3m)-10.53%
EPS NY rev (1m)-7.53%
EPS NY rev (3m)3.7%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-0.08%
Revenue NY rev (1m)0.52%
Revenue NY rev (3m)-0.21%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.49 | ||
| Fwd PE | 7.97 | ||
| P/S | 1.34 | ||
| P/FCF | 13.78 | ||
| P/OCF | 11.25 | ||
| P/B | 2.15 | ||
| P/tB | N/A | ||
| EV/EBITDA | 9.64 |
EPS(TTM)1.15
EY8.01%
EPS(NY)1.8
Fwd EY12.54%
FCF(TTM)1.04
FCFY7.26%
OCF(TTM)1.28
OCFY8.89%
SpS10.69
BVpS6.68
TBVpS-10.44
PEG (NY)0.55
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -0.46% | ||
| ROE | -1.55% | ||
| ROCE | 6.21% | ||
| ROIC | 4.9% | ||
| ROICexc | 5.19% | ||
| ROICexgc | 46.9% | ||
| OM | 11.85% | ||
| PM (TTM) | N/A | ||
| GM | 48.75% | ||
| FCFM | 9.75% |
ROA(3y)2.29%
ROA(5y)-0.83%
ROE(3y)6.03%
ROE(5y)-7.45%
ROIC(3y)4.42%
ROIC(5y)3.25%
ROICexc(3y)4.88%
ROICexc(5y)3.53%
ROICexgc(3y)63.88%
ROICexgc(5y)52.87%
ROCE(3y)5.59%
ROCE(5y)4.11%
ROICexcg growth 3Y28.97%
ROICexcg growth 5YN/A
ROICexc growth 3Y88.84%
ROICexc growth 5YN/A
OM growth 3Y70.3%
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y3.2%
GM growth 5YN/A
F-Score4
Asset Turnover0.48
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.61 | ||
| Debt/FCF | 10.42 | ||
| Debt/EBITDA | 4.3 | ||
| Cap/Depr | 19.08% | ||
| Cap/Sales | 2.2% | ||
| Interest Coverage | 1.27 | ||
| Cash Conversion | 51.13% | ||
| Profit Quality | N/A | ||
| Current Ratio | 1.76 | ||
| Quick Ratio | 1.76 | ||
| Altman-Z | 1.08 |
F-Score4
WACC9.02%
ROIC/WACC0.54
Cap/Depr(3y)19.13%
Cap/Depr(5y)18.31%
Cap/Sales(3y)1.98%
Cap/Sales(5y)2.08%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-53.25%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%22.22%
EPS Next Y22.84%
EPS Next 2Y27.37%
EPS Next 3Y23.89%
EPS Next 5YN/A
Revenue 1Y (TTM)-8.14%
Revenue growth 3Y10.15%
Revenue growth 5YN/A
Sales Q2Q%-1.28%
Revenue Next Year4.35%
Revenue Next 2Y7.18%
Revenue Next 3Y6.63%
Revenue Next 5YN/A
EBIT growth 1Y-1.86%
EBIT growth 3Y87.58%
EBIT growth 5YN/A
EBIT Next Year195.39%
EBIT Next 3Y58.42%
EBIT Next 5YN/A
FCF growth 1Y164.8%
FCF growth 3Y160.88%
FCF growth 5YN/A
OCF growth 1Y103.29%
OCF growth 3Y76.53%
OCF growth 5YN/A