NEW JERSEY RESOURCES CORP (NJR) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:NJR - US6460251068 - Common Stock
47.93 USD
-0.4 (-0.83%)
47.93 USD
0 (0%)
NJR gets a fundamental rating of 4 out of 10. The analysis compared the fundamentals against 14 industry peers in the Gas Utilities industry. While NJR belongs to the best of the industry regarding profitability, there are concerns on its financial health. While showing a medium growth rate, NJR is valued expensive at the moment.
1. Profitability
1.1 Basic Checks
- In the past year NJR was profitable.
- In the past year NJR had a positive cash flow from operations.
- NJR had positive earnings in each of the past 5 years.
- NJR had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
- NJR's Return On Assets of 4.43% is fine compared to the rest of the industry. NJR outperforms 71.43% of its industry peers.
- The Return On Equity of NJR (14.03%) is better than 71.43% of its industry peers.
- NJR's Return On Invested Capital of 4.97% is in line compared to the rest of the industry. NJR outperforms 57.14% of its industry peers.
- Measured over the past 3 years, the Average Return On Invested Capital for NJR is in line with the industry average of 6.27%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.43% | ||
| ROE | 14.03% | ||
| ROIC | 4.97% |
ROA(3y)4.21%
ROA(5y)3.82%
ROE(3y)13.5%
ROE(5y)12.57%
ROIC(3y)5.25%
ROIC(5y)5.16%
1.3 Margins
- NJR's Profit Margin of 16.48% is amongst the best of the industry. NJR outperforms 85.71% of its industry peers.
- NJR's Profit Margin has improved in the last couple of years.
- NJR's Operating Margin of 22.13% is fine compared to the rest of the industry. NJR outperforms 71.43% of its industry peers.
- NJR's Operating Margin has improved in the last couple of years.
- NJR has a worse Gross Margin (55.84%) than 64.29% of its industry peers.
- NJR's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 22.13% | ||
| PM (TTM) | 16.48% | ||
| GM | 55.84% |
OM growth 3Y16.52%
OM growth 5Y13.56%
PM growth 3Y20.33%
PM growth 5Y14.59%
GM growth 3Y19.25%
GM growth 5Y10.95%
2. Health
2.1 Basic Checks
- The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so NJR is destroying value.
- NJR has more shares outstanding than it did 1 year ago.
- The number of shares outstanding for NJR has been increased compared to 5 years ago.
- Compared to 1 year ago, NJR has an improved debt to assets ratio.
2.2 Solvency
- NJR has an Altman-Z score of 1.26. This is a bad value and indicates that NJR is not financially healthy and even has some risk of bankruptcy.
- With a decent Altman-Z score value of 1.26, NJR is doing good in the industry, outperforming 64.29% of the companies in the same industry.
- NJR has a Debt/Equity ratio of 1.44. This is a high value indicating a heavy dependency on external financing.
- With a Debt to Equity ratio value of 1.44, NJR is not doing good in the industry: 64.29% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.44 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 1.26 |
ROIC/WACC0.78
WACC6.37%
2.3 Liquidity
- NJR has a Current Ratio of 0.73. This is a bad value and indicates that NJR is not financially healthy enough and could expect problems in meeting its short term obligations.
- NJR's Current ratio of 0.73 is fine compared to the rest of the industry. NJR outperforms 64.29% of its industry peers.
- NJR has a Quick Ratio of 0.73. This is a bad value and indicates that NJR is not financially healthy enough and could expect problems in meeting its short term obligations.
- NJR's Quick ratio of 0.40 is on the low side compared to the rest of the industry. NJR is outperformed by 64.29% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.73 | ||
| Quick Ratio | 0.4 |
3. Growth
3.1 Past
- The Earnings Per Share has grown by an nice 11.53% over the past year.
- The Earnings Per Share has been growing by 9.71% on average over the past years. This is quite good.
- NJR shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 13.35%.
- NJR shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 0.83% yearly.
EPS 1Y (TTM)11.53%
EPS 3Y9.44%
EPS 5Y9.71%
EPS Q2Q%-82.02%
Revenue 1Y (TTM)13.35%
Revenue growth 3Y-11.18%
Revenue growth 5Y0.83%
Sales Q2Q%-15.08%
3.2 Future
- NJR is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 6.25% yearly.
- NJR is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 5.64% yearly.
EPS Next Y-4.12%
EPS Next 2Y2.03%
EPS Next 3Y4.85%
EPS Next 5Y6.25%
Revenue Next Year15.93%
Revenue Next 2Y10.52%
Revenue Next 3Y6.55%
Revenue Next 5Y5.64%
3.3 Evolution
- The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
- The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
- NJR is valuated correctly with a Price/Earnings ratio of 14.57.
- Based on the Price/Earnings ratio, NJR is valued a bit cheaper than the industry average as 71.43% of the companies are valued more expensively.
- NJR is valuated rather cheaply when we compare the Price/Earnings ratio to 27.21, which is the current average of the S&P500 Index.
- A Price/Forward Earnings ratio of 15.19 indicates a correct valuation of NJR.
- The rest of the industry has a similar Price/Forward Earnings ratio as NJR.
- Compared to an average S&P500 Price/Forward Earnings ratio of 25.98, NJR is valued a bit cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 14.57 | ||
| Fwd PE | 15.19 |
4.2 Price Multiples
- Based on the Enterprise Value to EBITDA ratio, NJR is valued a bit more expensive than the industry average as 71.43% of the companies are valued more cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 12.88 |
4.3 Compensation for Growth
- The decent profitability rating of NJR may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)1.5
EPS Next 2Y2.03%
EPS Next 3Y4.85%
5. Dividend
5.1 Amount
- NJR has a Yearly Dividend Yield of 3.93%.
- Compared to an average industry Dividend Yield of 3.96, NJR has a dividend in line with its industry peers.
- NJR's Dividend Yield is rather good when compared to the S&P500 average which is at 1.81.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.93% |
5.2 History
- The dividend of NJR is nicely growing with an annual growth rate of 7.28%!
- NJR has been paying a dividend for at least 10 years, so it has a reliable track record.
- NJR has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)7.28%
Div Incr Years29
Div Non Decr Years34
5.3 Sustainability
- 53.65% of the earnings are spent on dividend by NJR. This is a bit on the high side, but may be sustainable.
- The dividend of NJR is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP53.65%
EPS Next 2Y2.03%
EPS Next 3Y4.85%
NEW JERSEY RESOURCES CORP / NJR FAQ
What is the fundamental rating for NJR stock?
ChartMill assigns a fundamental rating of 4 / 10 to NJR.
What is the valuation status for NJR stock?
ChartMill assigns a valuation rating of 3 / 10 to NEW JERSEY RESOURCES CORP (NJR). This can be considered as Overvalued.
How profitable is NEW JERSEY RESOURCES CORP (NJR) stock?
NEW JERSEY RESOURCES CORP (NJR) has a profitability rating of 7 / 10.
How financially healthy is NEW JERSEY RESOURCES CORP?
The financial health rating of NEW JERSEY RESOURCES CORP (NJR) is 1 / 10.
What is the earnings growth outlook for NEW JERSEY RESOURCES CORP?
The Earnings per Share (EPS) of NEW JERSEY RESOURCES CORP (NJR) is expected to decline by -4.12% in the next year.