SM ENERGY CO (SM)
US78454L1008 - Common Stock
Overall SM gets a fundamental rating of 6 out of 10. We evaluated SM against 214 industry peers in the Oil, Gas & Consumable Fuels industry. SM scores excellent on profitability, but there are some minor concerns on its financial health. SM has a valuation in line with the averages, but it does not seem to be growing.
1. Profitability
1.1 Basic Checks
SM had positive earnings in the past year.
In the past year SM had a positive cash flow from operations.
The reported net income has been mixed in the past 5 years: SM reported negative net income in multiple years.
In the past 5 years SM always reported a positive cash flow from operatings.
1.2 Ratios
SM has a better Return On Assets (12.82%) than 72.43% of its industry peers.
With a decent Return On Equity value of 22.62%, SM is doing good in the industry, outperforming 68.22% of the companies in the same industry.
Looking at the Return On Invested Capital, with a value of 13.52%, SM is in the better half of the industry, outperforming 71.03% of the companies in the same industry.
SM had an Average Return On Invested Capital over the past 3 years of 22.74%. This is significantly below the industry average of 44.58%.
The 3 year average ROIC (22.74%) for SM is well above the current ROIC(13.52%). The reason for the recent decline needs to be investigated.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 12.82% | ||
| ROE | 22.62% | ||
| ROIC | 13.52% |
ROA(3y)10.99%
ROA(5y)2.93%
ROE(3y)20.14%
ROE(5y)3.14%
ROIC(3y)22.74%
ROIC(5y)N/A
1.3 Margins
SM's Profit Margin of 34.45% is fine compared to the rest of the industry. SM outperforms 76.64% of its industry peers.
SM's Profit Margin has improved in the last couple of years.
SM's Operating Margin of 38.70% is fine compared to the rest of the industry. SM outperforms 71.03% of its industry peers.
SM's Operating Margin has improved in the last couple of years.
The Gross Margin of SM (76.26%) is better than 81.78% of its industry peers.
In the last couple of years the Gross Margin of SM has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 38.7% | ||
| PM (TTM) | 34.45% | ||
| GM | 76.26% |
OM growth 3YN/A
OM growth 5Y16.37%
PM growth 3YN/A
PM growth 5Y2.14%
GM growth 3Y5.32%
GM growth 5Y1.65%
2. Health
2.1 Basic Checks
SM has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
The number of shares outstanding for SM has been reduced compared to 1 year ago.
SM has more shares outstanding than it did 5 years ago.
SM has a better debt/assets ratio than last year.
2.2 Solvency
An Altman-Z score of 2.56 indicates that SM is not a great score, but indicates only limited risk for bankruptcy at the moment.
SM has a Altman-Z score of 2.56. This is in the better half of the industry: SM outperforms 67.29% of its industry peers.
The Debt to FCF ratio of SM is 3.32, which is a good value as it means it would take SM, 3.32 years of fcf income to pay off all of its debts.
SM has a Debt to FCF ratio of 3.32. This is in the better half of the industry: SM outperforms 66.36% of its industry peers.
SM has a Debt/Equity ratio of 0.44. This is a healthy value indicating a solid balance between debt and equity.
The Debt to Equity ratio of SM (0.44) is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.44 | ||
| Debt/FCF | 3.32 | ||
| Altman-Z | 2.56 |
ROIC/WACC1.64
WACC8.23%
2.3 Liquidity
A Current Ratio of 1.45 indicates that SM should not have too much problems paying its short term obligations.
The Current ratio of SM (1.45) is better than 63.55% of its industry peers.
A Quick Ratio of 1.45 indicates that SM should not have too much problems paying its short term obligations.
Looking at the Quick ratio, with a value of 1.45, SM is in the better half of the industry, outperforming 69.63% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.45 | ||
| Quick Ratio | 1.45 |
3. Growth
3.1 Past
The earnings per share for SM have decreased strongly by -18.54% in the last year.
SM shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 187.86% yearly.
The Revenue for SM has decreased by -29.32% in the past year. This is quite bad
SM shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 7.67% yearly.
EPS 1Y (TTM)-18.54%
EPS 3YN/A
EPS 5Y187.86%
EPS growth Q2Q23.26%
Revenue 1Y (TTM)-29.32%
Revenue growth 3Y28.2%
Revenue growth 5Y7.67%
Revenue growth Q2Q-9.32%
3.2 Future
The Earnings Per Share is expected to grow by 8.45% on average over the next years. This is quite good.
SM is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 2.69% yearly.
EPS Next Y2.49%
EPS Next 2Y9.28%
EPS Next 3Y8.45%
EPS Next 5YN/A
Revenue Next Year3.42%
Revenue Next 2Y5.9%
Revenue Next 3Y2.69%
Revenue Next 5YN/A
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
SM is valuated cheaply with a Price/Earnings ratio of 7.95.
Compared to the rest of the industry, the Price/Earnings ratio of SM indicates a somewhat cheap valuation: SM is cheaper than 69.63% of the companies listed in the same industry.
SM is valuated cheaply when we compare the Price/Earnings ratio to 24.55, which is the current average of the S&P500 Index.
SM is valuated cheaply with a Price/Forward Earnings ratio of 7.75.
Based on the Price/Forward Earnings ratio, SM is valued a bit cheaper than 75.23% of the companies in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 20.92. SM is valued rather cheaply when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 7.95 | ||
| Fwd PE | 7.75 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of SM indicates a somewhat cheap valuation: SM is cheaper than 75.70% of the companies listed in the same industry.
The rest of the industry has a similar Price/Free Cash Flow ratio as SM.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 11.41 | ||
| EV/EBITDA | 4.06 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates SM does not grow enough to justify the current Price/Earnings ratio.
SM has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)3.2
PEG (5Y)0.04
EPS Next 2Y9.28%
EPS Next 3Y8.45%
5. Dividend
5.1 Amount
SM has a Yearly Dividend Yield of 1.43%. Purely for dividend investing, there may be better candidates out there.
SM's Dividend Yield is slightly below the industry average, which is at 5.72.
Compared to an average S&P500 Dividend Yield of 2.39, SM's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.43% |
5.2 History
The dividend of SM is nicely growing with an annual growth rate of 43.22%!
SM has paid a dividend for at least 10 years, which is a reliable track record.
SM has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)43.22%
Div Incr Years2
Div Non Decr Years3
5.3 Sustainability
SM pays out 8.76% of its income as dividend. This is a sustainable payout ratio.
SM's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP8.76%
EPS Next 2Y9.28%
EPS Next 3Y8.45%
SM ENERGY CO
NYSE:SM (5/1/2024, 4:50:52 PM)
After market: 51.08 +3.96 (+8.4%)47.12
-1.37 (-2.83%)
Chartmill FA Rating
GICS SectorEnergy
GICS IndustryGroupEnergy
GICS IndustryOil, Gas & Consumable Fuels
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap5.42B
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.43% |
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)
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Min Revenue beat(4)
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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 | 7.95 | ||
| Fwd PE | 7.75 | ||
| 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)3.2
PEG (5Y)0.04
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 12.82% | ||
| ROE | 22.62% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 38.7% | ||
| PM (TTM) | 34.45% | ||
| GM | 76.26% | ||
| 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 Turnover0.37
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.44 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 1.45 | ||
| Quick Ratio | 1.45 | ||
| 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)-18.54%
EPS 3YN/A
EPS 5Y
EPS growth Q2Q
EPS Next Y2.49%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)-29.32%
Revenue growth 3Y28.2%
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