MGE ENERGY INC (MGEE) Stock Fundamental Analysis
NASDAQ:MGEE - Nasdaq - US55277P1049 - Common Stock - Currency: USD
We assign a fundamental rating of 5 out of 10 to MGEE. MGEE was compared to 47 industry peers in the Electric Utilities industry. While MGEE belongs to the best of the industry regarding profitability, there are some minor concerns on its financial health. MGEE is quite expensive at the moment. It does show a decent growth rate.
1. Profitability
1.1 Basic Checks
MGEE had positive earnings in the past year.
In the past year MGEE had a positive cash flow from operations.
MGEE had positive earnings in each of the past 5 years.
Each year in the past 5 years MGEE had a positive operating cash flow.
1.2 Ratios
The Return On Assets of MGEE (4.52%) is better than 78.72% of its industry peers.
MGEE has a Return On Equity (10.20%) which is in line with its industry peers.
MGEE has a Return On Invested Capital of 5.01%. This is in the better half of the industry: MGEE outperforms 70.21% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for MGEE is significantly below the industry average of 38.54%.
The last Return On Invested Capital (5.01%) for MGEE is above the 3 year average (4.89%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.52% | ||
| ROE | 10.2% | ||
| ROIC | 5.01% |
ROA(3y)4.36%
ROA(5y)4.33%
ROE(3y)10.13%
ROE(5y)10.03%
ROIC(3y)4.89%
ROIC(5y)4.73%
1.3 Margins
MGEE's Profit Margin of 18.22% is amongst the best of the industry. MGEE outperforms 87.23% of its industry peers.
In the last couple of years the Profit Margin of MGEE has grown nicely.
MGEE has a Operating Margin of 22.48%. This is comparable to the rest of the industry: MGEE outperforms 59.57% of its industry peers.
In the last couple of years the Operating Margin of MGEE has grown nicely.
MGEE has a Gross Margin of 82.60%. This is in the better half of the industry: MGEE outperforms 78.72% of its industry peers.
In the last couple of years the Gross Margin of MGEE has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 22.48% | ||
| PM (TTM) | 18.22% | ||
| GM | 82.6% |
OM growth 3Y3.77%
OM growth 5Y2.08%
PM growth 3Y0.7%
PM growth 5Y3.12%
GM growth 3Y2.47%
GM growth 5Y1.05%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), MGEE is destroying value.
Compared to 1 year ago, MGEE has more shares outstanding
The number of shares outstanding for MGEE has been increased compared to 5 years ago.
MGEE has a better debt/assets ratio than last year.
2.2 Solvency
An Altman-Z score of 2.03 indicates that MGEE is not a great score, but indicates only limited risk for bankruptcy at the moment.
MGEE has a Altman-Z score of 2.03. This is amongst the best in the industry. MGEE outperforms 87.23% of its industry peers.
The Debt to FCF ratio of MGEE is 15.35, which is on the high side as it means it would take MGEE, 15.35 years of fcf income to pay off all of its debts.
The Debt to FCF ratio of MGEE (15.35) is better than 78.72% of its industry peers.
A Debt/Equity ratio of 0.61 indicates that MGEE is somewhat dependend on debt financing.
MGEE has a Debt to Equity ratio of 0.61. This is in the better half of the industry: MGEE outperforms 78.72% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.61 | ||
| Debt/FCF | 15.35 | ||
| Altman-Z | 2.03 |
ROIC/WACC0.62
WACC8.08%
2.3 Liquidity
A Current Ratio of 2.07 indicates that MGEE has no problem at all paying its short term obligations.
MGEE has a better Current ratio (2.07) than 87.23% of its industry peers.
A Quick Ratio of 1.49 indicates that MGEE should not have too much problems paying its short term obligations.
MGEE has a better Quick ratio (1.49) than 85.11% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.07 | ||
| Quick Ratio | 1.49 |
3. Growth
3.1 Past
MGEE shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 6.63%.
MGEE shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 5.80% yearly.
The Revenue has been growing slightly by 6.03% in the past year.
The Revenue has been growing slightly by 3.54% on average over the past years.
EPS 1Y (TTM)6.63%
EPS 3Y4.36%
EPS 5Y5.8%
EPS Q2Q%22.58%
Revenue 1Y (TTM)6.03%
Revenue growth 3Y3.73%
Revenue growth 5Y3.54%
Sales Q2Q%14.44%
3.2 Future
Based on estimates for the next years, MGEE will show a small growth in Earnings Per Share. The EPS will grow by 7.38% on average per year.
Based on estimates for the next years, MGEE will show a small growth in Revenue. The Revenue will grow by 4.49% on average per year.
EPS Next Y13.03%
EPS Next 2Y9.72%
EPS Next 3Y8.87%
EPS Next 5Y7.38%
Revenue Next Year5.41%
Revenue Next 2Y4.21%
Revenue Next 3Y3.85%
Revenue Next 5Y4.49%
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 accelerating.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 23.99, MGEE is valued on the expensive side.
Compared to the rest of the industry, the Price/Earnings ratio of MGEE indicates a rather expensive valuation: MGEE more expensive than 82.98% of the companies listed in the same industry.
The average S&P500 Price/Earnings ratio is at 27.25. MGEE is around the same levels.
MGEE is valuated rather expensively with a Price/Forward Earnings ratio of 21.19.
Based on the Price/Forward Earnings ratio, MGEE is valued more expensive than 80.85% of the companies in the same industry.
MGEE is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 36.80, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 23.99 | ||
| Fwd PE | 21.19 |
4.2 Price Multiples
76.60% of the companies in the same industry are cheaper than MGEE, based on the Enterprise Value to EBITDA ratio.
Based on the Price/Free Cash Flow ratio, MGEE is valued a bit cheaper than the industry average as 74.47% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 62.04 | ||
| EV/EBITDA | 14.14 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates MGEE does not grow enough to justify the current Price/Earnings ratio.
The decent profitability rating of MGEE may justify a higher PE ratio.
PEG (NY)1.84
PEG (5Y)4.14
EPS Next 2Y9.72%
EPS Next 3Y8.87%
5. Dividend
5.1 Amount
MGEE has a Yearly Dividend Yield of 2.07%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 3.68, MGEE is paying slightly less dividend.
Compared to an average S&P500 Dividend Yield of 2.34, MGEE has a dividend comparable with the average S&P500 company.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.07% |
5.2 History
The dividend of MGEE has a limited annual growth rate of 4.91%.
MGEE has been paying a dividend for at least 10 years, so it has a reliable track record.
MGEE has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)4.91%
Div Incr Years32
Div Non Decr Years32
5.3 Sustainability
50.30% of the earnings are spent on dividend by MGEE. This is a bit on the high side, but may be sustainable.
The dividend of MGEE is growing, but earnings are growing more, so the dividend growth is sustainable.
DP50.3%
EPS Next 2Y9.72%
EPS Next 3Y8.87%
84.94
+1.29 (+1.54%)
Chartmill FA Rating
GICS SectorUtilities
GICS IndustryGroupUtilities
GICS IndustryElectric Utilities
Earnings (Last)
Earnings (Next)
Inst Owners62.8%
Inst Owner Change-1.89%
Ins Owners0.24%
Ins Owner Change8.49%
Market Cap3.10B
Analysts37.14
Price Target72.93 (-14.14%)
Short Float %2.41%
Short Ratio5.76
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.07% |
Yearly Dividend1.75
Dividend Growth(5Y)4.91%
DP50.3%
Div Incr Years32
Div Non Decr Years32
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-11.18%
Min EPS beat(2)-28.8%
Max EPS beat(2)6.44%
EPS beat(4)1
Avg EPS beat(4)-14.89%
Min EPS beat(4)-31.89%
Max EPS beat(4)6.44%
EPS beat(8)2
Avg EPS beat(8)-7.91%
EPS beat(12)3
Avg EPS beat(12)-7.93%
EPS beat(16)5
Avg EPS beat(16)-7.22%
Revenue beat(2)N/A
Avg Revenue beat(2)N/A
Min Revenue beat(2)N/A
Max Revenue beat(2)N/A
Revenue beat(4)N/A
Avg Revenue beat(4)N/A
Min Revenue beat(4)N/A
Max Revenue beat(4)N/A
Revenue beat(8)N/A
Avg Revenue beat(8)N/A
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)0%
PT rev (3m)-0.69%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-2.5%
EPS NY rev (1m)0%
EPS NY rev (3m)-2.89%
Revenue NQ rev (1m)N/A
Revenue NQ rev (3m)N/A
Revenue NY rev (1m)0%
Revenue NY rev (3m)0%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 23.99 | ||
| Fwd PE | 21.19 | ||
| P/S | 4.41 | ||
| P/FCF | 62.04 | ||
| P/OCF | 10.71 | ||
| P/B | 2.47 | ||
| P/tB | 2.47 | ||
| EV/EBITDA | 14.14 |
EPS(TTM)3.54
EY4.17%
EPS(NY)4.01
Fwd EY4.72%
FCF(TTM)1.37
FCFY1.61%
OCF(TTM)7.93
OCFY9.34%
SpS19.28
BVpS34.45
TBVpS34.45
PEG (NY)1.84
PEG (5Y)4.14
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.52% | ||
| ROE | 10.2% | ||
| ROCE | 5.79% | ||
| ROIC | 5.01% | ||
| ROICexc | 5.07% | ||
| ROICexgc | 5.07% | ||
| OM | 22.48% | ||
| PM (TTM) | 18.22% | ||
| GM | 82.6% | ||
| FCFM | 7.1% |
ROA(3y)4.36%
ROA(5y)4.33%
ROE(3y)10.13%
ROE(5y)10.03%
ROIC(3y)4.89%
ROIC(5y)4.73%
ROICexc(3y)4.91%
ROICexc(5y)4.77%
ROICexgc(3y)4.91%
ROICexgc(5y)4.77%
ROCE(3y)5.74%
ROCE(5y)5.55%
ROICexcg growth 3Y1.41%
ROICexcg growth 5Y-1.04%
ROICexc growth 3Y1.41%
ROICexc growth 5Y-1.04%
OM growth 3Y3.77%
OM growth 5Y2.08%
PM growth 3Y0.7%
PM growth 5Y3.12%
GM growth 3Y2.47%
GM growth 5Y1.05%
F-Score7
Asset Turnover0.25
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.61 | ||
| Debt/FCF | 15.35 | ||
| Debt/EBITDA | 2.84 | ||
| Cap/Depr | 218.68% | ||
| Cap/Sales | 34.04% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 108.13% | ||
| Profit Quality | 38.98% | ||
| Current Ratio | 2.07 | ||
| Quick Ratio | 1.49 | ||
| Altman-Z | 2.03 |
F-Score7
WACC8.08%
ROIC/WACC0.62
Cap/Depr(3y)214.72%
Cap/Depr(5y)223.37%
Cap/Sales(3y)30.55%
Cap/Sales(5y)30.92%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)6.63%
EPS 3Y4.36%
EPS 5Y5.8%
EPS Q2Q%22.58%
EPS Next Y13.03%
EPS Next 2Y9.72%
EPS Next 3Y8.87%
EPS Next 5Y7.38%
Revenue 1Y (TTM)6.03%
Revenue growth 3Y3.73%
Revenue growth 5Y3.54%
Sales Q2Q%14.44%
Revenue Next Year5.41%
Revenue Next 2Y4.21%
Revenue Next 3Y3.85%
Revenue Next 5Y4.49%
EBIT growth 1Y7.66%
EBIT growth 3Y7.63%
EBIT growth 5Y5.69%
EBIT Next Year95.63%
EBIT Next 3Y30.21%
EBIT Next 5Y24.75%
FCF growth 1Y213.18%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y96.36%
OCF growth 3Y26.42%
OCF growth 5Y16.31%