PINNACLE WEST CAPITAL (PNW)
US7234841010 - Common Stock
Overall PNW gets a fundamental rating of 3 out of 10. We evaluated PNW against 45 industry peers in the Electric Utilities industry. There are concerns on the financial health of PNW while its profitability can be described as average. PNW is quite expensive at the moment. It does show a decent growth rate. Finally PNW also has an excellent dividend rating.
1. Profitability
1.1 Basic Checks
PNW had positive earnings in the past year.
PNW had a positive operating cash flow in the past year.
PNW had positive earnings in each of the past 5 years.
Each year in the past 5 years PNW had a positive operating cash flow.
1.2 Ratios
PNW has a Return On Assets (2.03%) which is in line with its industry peers.
PNW has a Return On Equity (8.12%) which is comparable to the rest of the industry.
With a Return On Invested Capital value of 2.98%, PNW is not doing good in the industry: 64.44% of the companies in the same industry are doing better.
The Average Return On Invested Capital over the past 3 years for PNW is in line with the industry average of 4.41%.
The last Return On Invested Capital (2.98%) for PNW is above the 3 year average (2.97%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.03% | ||
| ROE | 8.12% | ||
| ROIC | 2.98% |
ROA(3y)2.32%
ROA(5y)2.53%
ROE(3y)8.86%
ROE(5y)9.25%
ROIC(3y)2.97%
ROIC(5y)3.04%
1.3 Margins
PNW's Profit Margin of 10.68% is in line compared to the rest of the industry. PNW outperforms 48.89% of its industry peers.
PNW's Profit Margin has declined in the last couple of years.
PNW has a Operating Margin (17.56%) which is in line with its industry peers.
In the last couple of years the Operating Margin of PNW has declined.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 17.56% | ||
| PM (TTM) | 10.68% | ||
| GM | N/A |
OM growth 3Y-7.2%
OM growth 5Y-3.15%
PM growth 3Y-11.39%
PM growth 5Y-5.06%
GM growth 3YN/A
GM growth 5YN/A
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so PNW is destroying value.
The number of shares outstanding for PNW has been increased compared to 1 year ago.
PNW has more shares outstanding than it did 5 years ago.
Compared to 1 year ago, PNW has a worse debt to assets ratio.
2.2 Solvency
PNW has an Altman-Z score of 0.73. This is a bad value and indicates that PNW is not financially healthy and even has some risk of bankruptcy.
With a Altman-Z score value of 0.73, PNW perfoms like the industry average, outperforming 55.56% of the companies in the same industry.
PNW has a Debt/Equity ratio of 1.32. This is a high value indicating a heavy dependency on external financing.
PNW has a Debt to Equity ratio of 1.32. This is comparable to the rest of the industry: PNW outperforms 60.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.32 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 0.73 |
ROIC/WACC0.49
WACC6.08%
2.3 Liquidity
A Current Ratio of 0.67 indicates that PNW may have some problems paying its short term obligations.
With a Current ratio value of 0.67, PNW is not doing good in the industry: 77.78% of the companies in the same industry are doing better.
PNW has a Quick Ratio of 0.67. This is a bad value and indicates that PNW is not financially healthy enough and could expect problems in meeting its short term obligations.
PNW's Quick ratio of 0.50 is on the low side compared to the rest of the industry. PNW is outperformed by 75.56% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.67 | ||
| Quick Ratio | 0.5 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 3.28% over the past year.
PNW shows a decrease in Earnings Per Share. Measured over the last years, the EPS has been decreasing by -0.58% yearly.
PNW shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 8.59%.
PNW shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 4.93% yearly.
EPS 1Y (TTM)3.28%
EPS 3Y-3.32%
EPS 5Y-0.58%
EPS growth Q2Q100%
Revenue 1Y (TTM)8.59%
Revenue growth 3Y9.4%
Revenue growth 5Y4.93%
Revenue growth Q2Q-1.76%
3.2 Future
Based on estimates for the next years, PNW will show a small growth in Earnings Per Share. The EPS will grow by 6.21% on average per year.
PNW is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 4.89% yearly.
EPS Next Y8.24%
EPS Next 2Y6.21%
EPS Next 3Y6.75%
EPS Next 5Y6.21%
Revenue Next Year6.04%
Revenue Next 2Y5.14%
Revenue Next 3Y4.97%
Revenue Next 5Y4.89%
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
PNW is valuated rather expensively with a Price/Earnings ratio of 17.19.
PNW's Price/Earnings ratio is in line with the industry average.
PNW's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 28.28.
The Price/Forward Earnings ratio is 15.88, which indicates a correct valuation of PNW.
60.00% of the companies in the same industry are cheaper than PNW, based on the Price/Forward Earnings ratio.
Compared to an average S&P500 Price/Forward Earnings ratio of 20.88, PNW is valued a bit cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 17.19 | ||
| Fwd PE | 15.88 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of PNW is on the same level as its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 10.14 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates PNW does not grow enough to justify the current Price/Earnings ratio.
PEG (NY)2.09
PEG (5Y)N/A
EPS Next 2Y6.21%
EPS Next 3Y6.75%
5. Dividend
5.1 Amount
PNW has a Yearly Dividend Yield of 4.69%, which is a nice return.
Compared to an average industry Dividend Yield of 4.15, PNW pays a better dividend. On top of this PNW pays more dividend than 82.22% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 2.41, PNW pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.69% |
5.2 History
The dividend of PNW has a limited annual growth rate of 4.34%.
PNW has paid a dividend for at least 10 years, which is a reliable track record.
PNW has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)4.34%
Div Incr Years12
Div Non Decr Years19
5.3 Sustainability
77.06% of the earnings are spent on dividend by PNW. This is not a sustainable payout ratio.
PNW's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP77.06%
EPS Next 2Y6.21%
EPS Next 3Y6.75%
PINNACLE WEST CAPITAL
NYSE:PNW (5/3/2024, 7:12:58 PM)
After market: 75.79 0 (0%)75.79
+0.75 (+1%)
Chartmill FA Rating
GICS SectorUtilities
GICS IndustryGroupUtilities
GICS IndustryElectric Utilities
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap8.61B
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.69% |
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
Avg EPS beat(2)
Min EPS beat(2)
Max EPS beat(2)
EPS beat(4)
Avg EPS beat(4)
Min EPS beat(4)
Max EPS beat(4)
EPS beat(8)
Avg EPS beat(8)
EPS beat(12)
Avg EPS beat(12)
EPS beat(16)
Avg EPS beat(16)
Revenue beat(2)
Avg Revenue beat(2)
Min Revenue beat(2)
Max Revenue beat(2)
Revenue beat(4)
Avg Revenue beat(4)
Min Revenue beat(4)
Max Revenue beat(4)
Revenue beat(8)
Avg Revenue beat(8)
Revenue beat(12)
Avg Revenue beat(12)
Revenue beat(16)
Avg Revenue beat(16)
PT rev (1m)
PT rev (3m)
EPS NQ rev (1m)
EPS NQ rev (3m)
EPS NY rev (1m)
EPS NY rev (3m)
Revenue NQ rev (1m)
Revenue NQ rev (3m)
Revenue NY rev (1m)
Revenue NY rev (3m)
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 17.19 | ||
| Fwd PE | 15.88 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)2.09
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.03% | ||
| ROE | 8.12% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 17.56% | ||
| PM (TTM) | 10.68% | ||
| GM | N/A | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover0.19
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.32 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 0.67 | ||
| Quick Ratio | 0.5 | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
Growth
EPS 1Y (TTM)3.28%
EPS 3Y-3.32%
EPS 5Y
EPS growth Q2Q
EPS Next Y8.24%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)8.59%
Revenue growth 3Y9.4%
Revenue growth 5Y
Revenue growth Q2Q
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y