METHANEX CORP (MX.CA) Stock Fundamental Analysis
Canada - Toronto Stock Exchange - TSX:MX - CA59151K1084 - Common Stock
64.77 CAD
+1.12 (+1.76%)
Taking everything into account, MX scores 6 out of 10 in our fundamental rating. MX was compared to 29 industry peers in the Chemicals industry. While MX has a great profitability rating, there are some minor concerns on its financial health. MX scores decently on growth, while it is valued quite cheap. This could make an interesting combination. This makes MX very considerable for value investing!
1. Profitability
1.1 Basic Checks
- MX had positive earnings in the past year.
- In the past year MX had a positive cash flow from operations.
- Of the past 5 years MX 4 years were profitable.
- In the past 5 years MX always reported a positive cash flow from operatings.
1.2 Ratios
- With an excellent Return On Assets value of 2.84%, MX belongs to the best of the industry, outperforming 82.76% of the companies in the same industry.
- MX has a better Return On Equity (8.31%) than 86.21% of its industry peers.
- With an excellent Return On Invested Capital value of 5.46%, MX belongs to the best of the industry, outperforming 86.21% of the companies in the same industry.
- The Average Return On Invested Capital over the past 3 years for MX is below the industry average of 7.57%.
- The last Return On Invested Capital (5.46%) for MX is above the 3 year average (4.64%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.84% | ||
| ROE | 8.31% | ||
| ROIC | 5.46% |
ROA(3y)3.51%
ROA(5y)3.14%
ROE(3y)11.2%
ROE(5y)9.72%
ROIC(3y)4.64%
ROIC(5y)N/A
1.3 Margins
- MX has a better Profit Margin (5.99%) than 89.66% of its industry peers.
- MX's Profit Margin has improved in the last couple of years.
- MX has a better Operating Margin (14.45%) than 82.76% of its industry peers.
- MX's Operating Margin has improved in the last couple of years.
- MX has a better Gross Margin (25.93%) than 65.52% of its industry peers.
- In the last couple of years the Gross Margin of MX has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 14.45% | ||
| PM (TTM) | 5.99% | ||
| GM | 25.93% |
OM growth 3Y-18.5%
OM growth 5Y15.49%
PM growth 3Y-26.11%
PM growth 5Y10.52%
GM growth 3Y0.81%
GM growth 5Y5.2%
2. Health
2.1 Basic Checks
- MX has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
- The number of shares outstanding for MX remains at a similar level compared to 1 year ago.
- The number of shares outstanding for MX has been reduced compared to 5 years ago.
- MX has a worse debt/assets ratio than last year.
2.2 Solvency
- MX has an Altman-Z score of 1.60. This is a bad value and indicates that MX is not financially healthy and even has some risk of bankruptcy.
- MX has a better Altman-Z score (1.60) than 68.97% of its industry peers.
- The Debt to FCF ratio of MX is 3.90, which is a good value as it means it would take MX, 3.90 years of fcf income to pay off all of its debts.
- MX has a Debt to FCF ratio of 3.90. This is amongst the best in the industry. MX outperforms 96.55% of its industry peers.
- MX has a Debt/Equity ratio of 1.34. This is a high value indicating a heavy dependency on external financing.
- MX has a Debt to Equity ratio of 1.34. This is in the lower half of the industry: MX underperforms 68.97% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.34 | ||
| Debt/FCF | 3.9 | ||
| Altman-Z | 1.6 |
ROIC/WACC0.51
WACC10.72%
2.3 Liquidity
- MX has a Current Ratio of 2.09. This indicates that MX is financially healthy and has no problem in meeting its short term obligations.
- With a decent Current ratio value of 2.09, MX is doing good in the industry, outperforming 68.97% of the companies in the same industry.
- A Quick Ratio of 1.33 indicates that MX should not have too much problems paying its short term obligations.
- The Quick ratio of MX (1.33) is better than 68.97% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.09 | ||
| Quick Ratio | 1.33 |
3. Growth
3.1 Past
- The Earnings Per Share has grown by an nice 19.00% over the past year.
- The Earnings Per Share has been growing by 31.95% on average over the past years. This is a very strong growth
- Looking at the last year, MX shows a decrease in Revenue. The Revenue has decreased by -3.36% in the last year.
- Measured over the past years, MX shows a small growth in Revenue. The Revenue has been growing by 2.53% on average per year.
EPS 1Y (TTM)19%
EPS 3Y-14.87%
EPS 5Y31.95%
EPS Q2Q%-95.04%
Revenue 1Y (TTM)-3.36%
Revenue growth 3Y-5.55%
Revenue growth 5Y2.53%
Sales Q2Q%-0.79%
3.2 Future
- Based on estimates for the next years, MX will show a decrease in Earnings Per Share. The EPS will decrease by -8.42% on average per year.
- Based on estimates for the next years, MX will show a small growth in Revenue. The Revenue will grow by 3.53% on average per year.
EPS Next Y-14.63%
EPS Next 2Y-1.98%
EPS Next 3Y3.13%
EPS Next 5Y-8.42%
Revenue Next Year-2.72%
Revenue Next 2Y4.64%
Revenue Next 3Y3.53%
Revenue Next 5YN/A
3.3 Evolution
- The EPS growth rate is decreasing: in the next years the growth will be less than in the last 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 accelerating.
4. Valuation
4.1 Price/Earnings Ratio
- With a Price/Earnings ratio of 13.38, MX is valued correctly.
- 93.10% of the companies in the same industry are more expensive than MX, based on the Price/Earnings ratio.
- The average S&P500 Price/Earnings ratio is at 28.60. MX is valued rather cheaply when compared to this.
- Based on the Price/Forward Earnings ratio of 13.36, the valuation of MX can be described as correct.
- MX's Price/Forward Earnings ratio is rather cheap when compared to the industry. MX is cheaper than 86.21% of the companies in the same industry.
- MX is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 25.83, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.38 | ||
| Fwd PE | 13.36 |
4.2 Price Multiples
- Based on the Enterprise Value to EBITDA ratio, MX is valued cheaper than 86.21% of the companies in the same industry.
- Compared to the rest of the industry, the Price/Free Cash Flow ratio of MX indicates a rather cheap valuation: MX is cheaper than 100.00% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 3.98 | ||
| EV/EBITDA | 7.45 |
4.3 Compensation for Growth
- The excellent profitability rating of MX may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)0.42
EPS Next 2Y-1.98%
EPS Next 3Y3.13%
5. Dividend
5.1 Amount
- With a Yearly Dividend Yield of 1.60%, MX has a reasonable but not impressive dividend return.
- MX's Dividend Yield is a higher than the industry average which is at 2.08.
- Compared to an average S&P500 Dividend Yield of 1.82, MX has a dividend comparable with the average S&P500 company.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.6% |
5.2 History
- The dividend of MX decreases each year by -12.05%.
- MX has paid a dividend for at least 10 years, which is a reliable track record.
- MX has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)-12.05%
Div Incr Years3
Div Non Decr Years3
5.3 Sustainability
- 24.20% of the earnings are spent on dividend by MX. This is a low number and sustainable payout ratio.
- MX's earnings and Dividend Rate are declining. This means the current dividend is most likely not sustainable.
DP24.2%
EPS Next 2Y-1.98%
EPS Next 3Y3.13%
METHANEX CORP / MX.CA FAQ
What is the fundamental rating for MX stock?
ChartMill assigns a fundamental rating of 6 / 10 to MX.CA.
What is the valuation status for MX stock?
ChartMill assigns a valuation rating of 7 / 10 to METHANEX CORP (MX.CA). This can be considered as Undervalued.
What is the profitability of MX stock?
METHANEX CORP (MX.CA) has a profitability rating of 8 / 10.
What is the financial health of METHANEX CORP (MX.CA) stock?
The financial health rating of METHANEX CORP (MX.CA) is 5 / 10.
What is the earnings growth outlook for METHANEX CORP?
The Earnings per Share (EPS) of METHANEX CORP (MX.CA) is expected to decline by -14.63% in the next year.