MIDDLESEX WATER CO (MSEX) Stock Fundamental Analysis
NASDAQ:MSEX - Nasdaq - US5966801087 - Common Stock - Currency: USD
We assign a fundamental rating of 4 out of 10 to MSEX. MSEX was compared to 14 industry peers in the Water Utilities industry. MSEX has a medium profitability rating, but doesn't score so well on its financial health evaluation. MSEX is quite expensive at the moment. It does show a decent growth rate.
1. Profitability
1.1 Basic Checks
MSEX had positive earnings in the past year.
In the past year MSEX had a positive cash flow from operations.
In the past 5 years MSEX has always been profitable.
MSEX had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
MSEX's Return On Assets of 3.52% is fine compared to the rest of the industry. MSEX outperforms 64.29% of its industry peers.
MSEX has a Return On Equity of 9.90%. This is comparable to the rest of the industry: MSEX outperforms 50.00% of its industry peers.
With a Return On Invested Capital value of 3.52%, MSEX perfoms like the industry average, outperforming 50.00% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for MSEX is below the industry average of 5.20%.
The last Return On Invested Capital (3.52%) for MSEX is above the 3 year average (3.15%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.52% | ||
| ROE | 9.9% | ||
| ROIC | 3.52% |
ROA(3y)3.33%
ROA(5y)3.5%
ROE(3y)9.27%
ROE(5y)9.73%
ROIC(3y)3.15%
ROIC(5y)3.07%
1.3 Margins
Looking at the Profit Margin, with a value of 23.06%, MSEX is in the better half of the industry, outperforming 71.43% of the companies in the same industry.
In the last couple of years the Profit Margin of MSEX has declined.
MSEX's Operating Margin of 27.73% is in line compared to the rest of the industry. MSEX outperforms 50.00% of its industry peers.
MSEX's Operating Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 27.73% | ||
| PM (TTM) | 23.06% | ||
| GM | N/A |
OM growth 3Y6.13%
OM growth 5Y1.01%
PM growth 3Y-3.22%
PM growth 5Y-1.69%
GM growth 3YN/A
GM growth 5YN/A
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), MSEX is destroying value.
The number of shares outstanding for MSEX has been increased compared to 1 year ago.
MSEX has more shares outstanding than it did 5 years ago.
The debt/assets ratio for MSEX has been reduced compared to a year ago.
2.2 Solvency
Based on the Altman-Z score of 1.28, we must say that MSEX is in the distress zone and has some risk of bankruptcy.
The Altman-Z score of MSEX (1.28) is better than 71.43% of its industry peers.
A Debt/Equity ratio of 0.84 indicates that MSEX is somewhat dependend on debt financing.
The Debt to Equity ratio of MSEX (0.84) is better than 64.29% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.84 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 1.28 |
ROIC/WACC0.44
WACC8.03%
2.3 Liquidity
MSEX has a Current Ratio of 0.52. This is a bad value and indicates that MSEX is not financially healthy enough and could expect problems in meeting its short term obligations.
MSEX's Current ratio of 0.52 is on the low side compared to the rest of the industry. MSEX is outperformed by 78.57% of its industry peers.
MSEX has a Quick Ratio of 0.52. This is a bad value and indicates that MSEX is not financially healthy enough and could expect problems in meeting its short term obligations.
With a Quick ratio value of 0.44, MSEX is not doing good in the industry: 85.71% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.52 | ||
| Quick Ratio | 0.44 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 19.31% over the past year.
MSEX shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 4.31% yearly.
Looking at the last year, MSEX shows a quite strong growth in Revenue. The Revenue has grown by 15.40% in the last year.
MSEX shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 7.35% yearly.
EPS 1Y (TTM)19.31%
EPS 3Y6.07%
EPS 5Y4.31%
EPS Q2Q%-10.17%
Revenue 1Y (TTM)15.4%
Revenue growth 3Y10.27%
Revenue growth 5Y7.35%
Sales Q2Q%9.32%
3.2 Future
The Earnings Per Share is expected to grow by 5.92% on average over the next years.
The Revenue is expected to grow by 7.45% on average over the next years.
EPS Next Y4.62%
EPS Next 2Y5.92%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue Next Year8.3%
Revenue Next 2Y7.45%
Revenue Next 3YN/A
Revenue Next 5YN/A
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
The Revenue growth rate is stable: in the next years the growth will be about the same than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
MSEX is valuated quite expensively with a Price/Earnings ratio of 25.05.
Compared to the rest of the industry, the Price/Earnings ratio of MSEX is on the same level as its industry peers.
MSEX's Price/Earnings ratio indicates a similar valuation than the S&P500 average which is at 28.18.
A Price/Forward Earnings ratio of 21.78 indicates a rather expensive valuation of MSEX.
Based on the Price/Forward Earnings ratio, MSEX is valued a bit cheaper than 64.29% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of MSEX to the average of the S&P500 Index (20.81), we can say MSEX is valued inline with the index average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 25.05 | ||
| Fwd PE | 21.78 |
4.2 Price Multiples
MSEX's Enterprise Value to EBITDA ratio is a bit more expensive when compared to the industry. MSEX is more expensive than 71.43% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 17.68 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates MSEX does not grow enough to justify the current Price/Earnings ratio.
PEG (NY)5.43
PEG (5Y)5.81
EPS Next 2Y5.92%
EPS Next 3YN/A
5. Dividend
5.1 Amount
MSEX has a Yearly Dividend Yield of 2.17%. Purely for dividend investing, there may be better candidates out there.
MSEX's Dividend Yield is slightly below the industry average, which is at 3.29.
Compared to an average S&P500 Dividend Yield of 2.45, MSEX has a dividend comparable with the average S&P500 company.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.17% |
5.2 History
On average, the dividend of MSEX grows each year by 6.43%, which is quite nice.
MSEX has paid a dividend for at least 10 years, which is a reliable track record.
The dividend of MSEX decreased in the last 3 years.
Dividend Growth(5Y)6.43%
Div Incr Years2
Div Non Decr Years2
5.3 Sustainability
53.16% of the earnings are spent on dividend by MSEX. This is a bit on the high side, but may be sustainable.
The dividend of MSEX is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP53.16%
EPS Next 2Y5.92%
EPS Next 3YN/A
60.36
-2.43 (-3.87%)
Chartmill FA Rating
GICS SectorUtilities
GICS IndustryGroupUtilities
GICS IndustryWater Utilities
Earnings (Last)
Earnings (Next)
Inst Owners78.75%
Inst Owner Change1.05%
Ins Owners1.18%
Ins Owner Change8.46%
Market Cap1.08B
Analysts50
Price Target67.66 (12.09%)
Short Float %2.93%
Short Ratio2.76
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.17% |
Yearly Dividend1.32
Dividend Growth(5Y)6.43%
DP53.16%
Div Incr Years2
Div Non Decr Years2
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)23.48%
Min EPS beat(2)15.34%
Max EPS beat(2)31.61%
EPS beat(4)3
Avg EPS beat(4)15.43%
Min EPS beat(4)-9.62%
Max EPS beat(4)31.61%
EPS beat(8)3
Avg EPS beat(8)-7.02%
EPS beat(12)4
Avg EPS beat(12)-8.01%
EPS beat(16)5
Avg EPS beat(16)-9.48%
Revenue beat(2)2
Avg Revenue beat(2)5.25%
Min Revenue beat(2)3.09%
Max Revenue beat(2)7.4%
Revenue beat(4)2
Avg Revenue beat(4)-0.7%
Min Revenue beat(4)-10.82%
Max Revenue beat(4)7.4%
Revenue beat(8)2
Avg Revenue beat(8)-5.72%
Revenue beat(12)2
Avg Revenue beat(12)-5.07%
Revenue beat(16)2
Avg Revenue beat(16)-4.77%
PT rev (1m)6.42%
PT rev (3m)8.74%
EPS NQ rev (1m)2.7%
EPS NQ rev (3m)14%
EPS NY rev (1m)-0.46%
EPS NY rev (3m)5.41%
Revenue NQ rev (1m)-3.86%
Revenue NQ rev (3m)-2.14%
Revenue NY rev (1m)-2.7%
Revenue NY rev (3m)2.16%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 25.05 | ||
| Fwd PE | 21.78 | ||
| P/S | 5.63 | ||
| P/FCF | N/A | ||
| P/OCF | 18.39 | ||
| P/B | 2.42 | ||
| P/tB | 2.42 | ||
| EV/EBITDA | 17.68 |
EPS(TTM)2.41
EY3.99%
EPS(NY)2.77
Fwd EY4.59%
FCF(TTM)-0.89
FCFYN/A
OCF(TTM)3.28
OCFY5.44%
SpS10.73
BVpS24.98
TBVpS24.98
PEG (NY)5.43
PEG (5Y)5.81
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.52% | ||
| ROE | 9.9% | ||
| ROCE | 4.54% | ||
| ROIC | 3.52% | ||
| ROICexc | 3.53% | ||
| ROICexgc | 3.53% | ||
| OM | 27.73% | ||
| PM (TTM) | 23.06% | ||
| GM | N/A | ||
| FCFM | N/A |
ROA(3y)3.33%
ROA(5y)3.5%
ROE(3y)9.27%
ROE(5y)9.73%
ROIC(3y)3.15%
ROIC(5y)3.07%
ROICexc(3y)3.16%
ROICexc(5y)3.08%
ROICexgc(3y)3.16%
ROICexgc(5y)3.08%
ROCE(3y)4.13%
ROCE(5y)3.98%
ROICexcg growth 3Y9.39%
ROICexcg growth 5Y1.66%
ROICexc growth 3Y9.39%
ROICexc growth 5Y1.66%
OM growth 3Y6.13%
OM growth 5Y1.01%
PM growth 3Y-3.22%
PM growth 5Y-1.69%
GM growth 3YN/A
GM growth 5YN/A
F-Score7
Asset Turnover0.15
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.84 | ||
| Debt/FCF | N/A | ||
| Debt/EBITDA | 4.63 | ||
| Cap/Depr | 266.15% | ||
| Cap/Sales | 38.89% | ||
| Interest Coverage | 3.67 | ||
| Cash Conversion | 72.28% | ||
| Profit Quality | N/A | ||
| Current Ratio | 0.52 | ||
| Quick Ratio | 0.44 | ||
| Altman-Z | 1.28 |
F-Score7
WACC8.03%
ROIC/WACC0.44
Cap/Depr(3y)301.61%
Cap/Depr(5y)341.57%
Cap/Sales(3y)49.79%
Cap/Sales(5y)55.89%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)19.31%
EPS 3Y6.07%
EPS 5Y4.31%
EPS Q2Q%-10.17%
EPS Next Y4.62%
EPS Next 2Y5.92%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue 1Y (TTM)15.4%
Revenue growth 3Y10.27%
Revenue growth 5Y7.35%
Sales Q2Q%9.32%
Revenue Next Year8.3%
Revenue Next 2Y7.45%
Revenue Next 3YN/A
Revenue Next 5YN/A
EBIT growth 1Y35.66%
EBIT growth 3Y17.03%
EBIT growth 5Y8.43%
EBIT Next Year65.46%
EBIT Next 3YN/A
EBIT Next 5YN/A
FCF growth 1Y57.5%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y11.27%
OCF growth 3Y21.15%
OCF growth 5Y10.25%