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PNM RESOURCES INC (PNM) Stock Fundamental Analysis

NYSE:PNM - New York Stock Exchange, Inc. - US69349H1077 - Common Stock - Currency: USD

41.77  -0.44 (-1.04%)

After market: 41.77 0 (0%)

Fundamental Rating

2

Taking everything into account, PNM scores 2 out of 10 in our fundamental rating. PNM was compared to 46 industry peers in the Electric Utilities industry. PNM may be in some trouble as it scores bad on both profitability and health. PNM has a expensive valuation and it also scores bad on growth.


Dividend Valuation Growth Profitability Health

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2

1. Profitability

1.1 Basic Checks

PNM had positive earnings in the past year.
In the past year PNM had a positive cash flow from operations.
Each year in the past 5 years PNM has been profitable.
In the past 5 years PNM always reported a positive cash flow from operatings.
PNM Yearly Net Income VS EBIT VS OCF VS FCFPNM Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 2023 0 200M -200M 400M -400M

1.2 Ratios

The Return On Assets of PNM (0.78%) is worse than 93.33% of its industry peers.
PNM's Return On Equity of 3.38% is on the low side compared to the rest of the industry. PNM is outperformed by 93.33% of its industry peers.
The Return On Invested Capital of PNM (2.70%) is worse than 77.78% of its industry peers.
PNM had an Average Return On Invested Capital over the past 3 years of 3.42%. This is in line with the industry average of 4.74%.
Industry RankSector Rank
ROA 0.78%
ROE 3.38%
ROIC 2.7%
ROA(3y)1.65%
ROA(5y)1.64%
ROE(3y)6.8%
ROE(5y)6.67%
ROIC(3y)3.42%
ROIC(5y)3.56%
PNM Yearly ROA, ROE, ROICPNM Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2015 2016 2017 2018 2019 2020 2021 2022 2023 2 4 6 8

1.3 Margins

PNM has a Profit Margin of 4.37%. This is amonst the worse of the industry: PNM underperforms 86.67% of its industry peers.
In the last couple of years the Profit Margin of PNM has declined.
PNM has a Operating Margin of 15.79%. This is in the lower half of the industry: PNM underperforms 66.67% of its industry peers.
In the last couple of years the Operating Margin of PNM has declined.
Industry RankSector Rank
OM 15.79%
PM (TTM) 4.37%
GM N/A
OM growth 3Y-5.96%
OM growth 5Y-5.73%
PM growth 3Y-26.37%
PM growth 5Y-5.34%
GM growth 3YN/A
GM growth 5YN/A
PNM Yearly Profit, Operating, Gross MarginsPNM Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2015 2016 2017 2018 2019 2020 2021 2022 2023 5 10 15 20

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0

2. Health

2.1 Basic Checks

The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so PNM is destroying value.
The number of shares outstanding for PNM has been increased compared to 1 year ago.
The number of shares outstanding for PNM has been increased compared to 5 years ago.
Compared to 1 year ago, PNM has a worse debt to assets ratio.
PNM Yearly Shares OutstandingPNM Yearly Shares OutstandingYearly Shares Outstanding 2015 2016 2017 2018 2019 2020 2021 2022 2023 20M 40M 60M 80M
PNM Yearly Total Debt VS Total AssetsPNM Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2015 2016 2017 2018 2019 2020 2021 2022 2023 2B 4B 6B 8B 10B

2.2 Solvency

Based on the Altman-Z score of 0.59, we must say that PNM is in the distress zone and has some risk of bankruptcy.
PNM's Altman-Z score of 0.59 is on the low side compared to the rest of the industry. PNM is outperformed by 77.78% of its industry peers.
PNM has a Debt/Equity ratio of 1.95. This is a high value indicating a heavy dependency on external financing.
Looking at the Debt to Equity ratio, with a value of 1.95, PNM is doing worse than 88.89% of the companies in the same industry.
Industry RankSector Rank
Debt/Equity 1.95
Debt/FCF N/A
Altman-Z 0.59
ROIC/WACC0.49
WACC5.53%
PNM Yearly LT Debt VS Equity VS FCFPNM Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 2023 0 1B 2B 3B 4B

2.3 Liquidity

A Current Ratio of 0.37 indicates that PNM may have some problems paying its short term obligations.
PNM's Current ratio of 0.37 is on the low side compared to the rest of the industry. PNM is outperformed by 95.56% of its industry peers.
A Quick Ratio of 0.27 indicates that PNM may have some problems paying its short term obligations.
PNM's Quick ratio of 0.27 is on the low side compared to the rest of the industry. PNM is outperformed by 93.33% of its industry peers.
Industry RankSector Rank
Current Ratio 0.37
Quick Ratio 0.27
PNM Yearly Current Assets VS Current LiabilitesPNM Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2015 2016 2017 2018 2019 2020 2021 2022 2023 200M 400M 600M 800M 1B

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3

3. Growth

3.1 Past

The Earnings Per Share has been growing slightly by 5.22% over the past year.
PNM shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 7.11% yearly.
The Revenue for PNM has decreased by -13.80% in the past year. This is quite bad
The Revenue has been growing slightly by 6.18% on average over the past years.
EPS 1Y (TTM)5.22%
EPS 3Y7.34%
EPS 5Y7.11%
EPS Q2Q%0%
Revenue 1Y (TTM)-13.8%
Revenue growth 3Y8.39%
Revenue growth 5Y6.18%
Sales Q2Q%N/A

3.2 Future

Based on estimates for the next years, PNM will show a small growth in Earnings Per Share. The EPS will grow by 4.62% on average per year.
Based on estimates for the next years, PNM will show a small growth in Revenue. The Revenue will grow by 4.85% on average per year.
EPS Next Y-3.73%
EPS Next 2Y0.39%
EPS Next 3Y2.6%
EPS Next 5Y4.62%
Revenue Next Year0.38%
Revenue Next 2Y3.29%
Revenue Next 3Y4.25%
Revenue Next 5Y4.85%

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 decreasing: in the next years the growth will be less than in the last years.
PNM Yearly Revenue VS EstimatesPNM Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 500M 1B 1.5B 2B 2.5B
PNM Yearly EPS VS EstimatesPNM Yearly EPS VS EstimatesYearly EPS VS Estimates 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 1 2 3

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2

4. Valuation

4.1 Price/Earnings Ratio

A Price/Earnings ratio of 14.81 indicates a correct valuation of PNM.
PNM's Price/Earnings ratio is a bit cheaper when compared to the industry. PNM is cheaper than 64.44% of the companies in the same industry.
The average S&P500 Price/Earnings ratio is at 25.05. PNM is valued slightly cheaper when compared to this.
A Price/Forward Earnings ratio of 14.70 indicates a correct valuation of PNM.
Compared to the rest of the industry, the Price/Forward Earnings ratio of PNM is on the same level as its industry peers.
PNM's Price/Forward Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 21.07.
Industry RankSector Rank
PE 14.81
Fwd PE 14.7
PNM Price Earnings VS Forward Price EarningsPNM Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 5 10 15 20 25

4.2 Price Multiples

Based on the Enterprise Value to EBITDA ratio, PNM is valued a bit more expensive than 68.89% of the companies in the same industry.
Industry RankSector Rank
P/FCF N/A
EV/EBITDA 12.79
PNM Per share dataPNM EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 0 10 20

4.3 Compensation for Growth

PEG (NY)N/A
PEG (5Y)2.08
EPS Next 2Y0.39%
EPS Next 3Y2.6%

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5

5. Dividend

5.1 Amount

PNM has a Yearly Dividend Yield of 3.71%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 3.45, PNM has a dividend in line with its industry peers.
PNM's Dividend Yield is rather good when compared to the S&P500 average which is at 2.40.
Industry RankSector Rank
Dividend Yield 3.71%

5.2 History

The dividend of PNM is nicely growing with an annual growth rate of 6.18%!
PNM has been paying a dividend for at least 10 years, so it has a reliable track record.
PNM has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)6.18%
Div Incr Years12
Div Non Decr Years14
PNM Yearly Dividends per sharePNM Yearly Dividends per shareYearly Dividends per share 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0.5 1

5.3 Sustainability

PNM pays out 162.66% of its income as dividend. This is not a sustainable payout ratio.
The dividend of PNM is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP162.66%
EPS Next 2Y0.39%
EPS Next 3Y2.6%
PNM Yearly Income VS Free CF VS DividendPNM Yearly Income VS Free CF VS DividendYearly Income VS Free CF VS Dividend 2015 2016 2017 2018 2019 2020 2021 2022 2023 0 -200M -400M
PNM Dividend Payout.PNM Dividend Payout, showing the Payout Ratio.PNM Dividend Payout.PayoutRetained Earnings

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PNM RESOURCES INC

NYSE:PNM (8/2/2024, 8:26:38 PM)

After market: 41.77 0 (0%)

41.77

-0.44 (-1.04%)

Chartmill FA Rating
GICS SectorUtilities
GICS IndustryGroupUtilities
GICS IndustryElectric Utilities
Earnings (Last)07-31 2024-07-31/bmo
Earnings (Next)10-25 2024-10-25/bmo
Inst Owners95.18%
Inst Owner Change-0.44%
Ins Owners0.68%
Ins Owner Change0%
Market Cap3.77B
Analysts76.67
Price Target45.61 (9.19%)
Short Float %N/A
Short RatioN/A
Dividend
Industry RankSector Rank
Dividend Yield 3.71%
Yearly Dividend1.44
Dividend Growth(5Y)6.18%
DP162.66%
Div Incr Years12
Div Non Decr Years14
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)11.9%
Min EPS beat(2)2.36%
Max EPS beat(2)21.44%
EPS beat(4)3
Avg EPS beat(4)7.91%
Min EPS beat(4)-2.8%
Max EPS beat(4)21.44%
EPS beat(8)6
Avg EPS beat(8)7.92%
EPS beat(12)10
Avg EPS beat(12)24.06%
EPS beat(16)13
Avg EPS beat(16)22.18%
Revenue beat(2)0
Avg Revenue beat(2)-21.59%
Min Revenue beat(2)-24.65%
Max Revenue beat(2)-18.54%
Revenue beat(4)1
Avg Revenue beat(4)-15.15%
Min Revenue beat(4)-24.65%
Max Revenue beat(4)5.75%
Revenue beat(8)5
Avg Revenue beat(8)16.69%
Revenue beat(12)8
Avg Revenue beat(12)15.79%
Revenue beat(16)10
Avg Revenue beat(16)11.41%
PT rev (1m)0.58%
PT rev (3m)-0.7%
EPS NQ rev (1m)4.06%
EPS NQ rev (3m)5.9%
EPS NY rev (1m)0.08%
EPS NY rev (3m)0.68%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0.08%
Revenue NY rev (1m)0.95%
Revenue NY rev (3m)-6.83%
Valuation
Industry RankSector Rank
PE 14.81
Fwd PE 14.7
P/S 2.06
P/FCF N/A
P/OCF 7.35
P/B 1.59
P/tB 1.8
EV/EBITDA 12.79
EPS(TTM)2.82
EY6.75%
EPS(NY)2.84
Fwd EY6.8%
FCF(TTM)-6.52
FCFYN/A
OCF(TTM)5.68
OCFY13.6%
SpS20.31
BVpS26.24
TBVpS23.16
PEG (NY)N/A
PEG (5Y)2.08
Profitability
Industry RankSector Rank
ROA 0.78%
ROE 3.38%
ROCE 3.16%
ROIC 2.7%
ROICexc 2.7%
ROICexgc 2.78%
OM 15.79%
PM (TTM) 4.37%
GM N/A
FCFM N/A
ROA(3y)1.65%
ROA(5y)1.64%
ROE(3y)6.8%
ROE(5y)6.67%
ROIC(3y)3.42%
ROIC(5y)3.56%
ROICexc(3y)3.42%
ROICexc(5y)3.57%
ROICexgc(3y)3.53%
ROICexgc(5y)3.7%
ROCE(3y)3.98%
ROCE(5y)4.14%
ROICexcg growth 3Y-7.78%
ROICexcg growth 5Y-6.77%
ROICexc growth 3Y-7.46%
ROICexc growth 5Y-6.53%
OM growth 3Y-5.96%
OM growth 5Y-5.73%
PM growth 3Y-26.37%
PM growth 5Y-5.34%
GM growth 3YN/A
GM growth 5YN/A
F-Score4
Asset Turnover0.18
Health
Industry RankSector Rank
Debt/Equity 1.95
Debt/FCF N/A
Debt/EBITDA 7.01
Cap/Depr 297.79%
Cap/Sales 60.07%
Interest Coverage 1.76
Cash Conversion 77.79%
Profit Quality N/A
Current Ratio 0.37
Quick Ratio 0.27
Altman-Z 0.59
F-Score4
WACC5.53%
ROIC/WACC0.49
Cap/Depr(3y)287.89%
Cap/Depr(5y)256.83%
Cap/Sales(3y)49.53%
Cap/Sales(5y)47.09%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)5.22%
EPS 3Y7.34%
EPS 5Y7.11%
EPS Q2Q%0%
EPS Next Y-3.73%
EPS Next 2Y0.39%
EPS Next 3Y2.6%
EPS Next 5Y4.62%
Revenue 1Y (TTM)-13.8%
Revenue growth 3Y8.39%
Revenue growth 5Y6.18%
Sales Q2Q%N/A
Revenue Next Year0.38%
Revenue Next 2Y3.29%
Revenue Next 3Y4.25%
Revenue Next 5Y4.85%
EBIT growth 1Y-32.05%
EBIT growth 3Y1.93%
EBIT growth 5Y0.1%
EBIT Next Year77.87%
EBIT Next 3Y29.73%
EBIT Next 5Y22.24%
FCF growth 1Y-48.98%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y-11.33%
OCF growth 3Y4.31%
OCF growth 5Y5.18%