CENTERPOINT ENERGY INC (CNP) Stock Fundamental Analysis
NYSE:CNP - New York Stock Exchange, Inc. - US15189T1079 - Common Stock - Currency: USD
We assign a fundamental rating of 3 out of 10 to CNP. CNP was compared to 25 industry peers in the Multi-Utilities industry. There are concerns on the financial health of CNP while its profitability can be described as average. While showing a medium growth rate, CNP is valued expensive at the moment.
1. Profitability
1.1 Basic Checks
In the past year CNP was profitable.
CNP had a positive operating cash flow in the past year.
CNP had positive earnings in 4 of the past 5 years.
In the past 5 years CNP always reported a positive cash flow from operatings.
1.2 Ratios
CNP's Return On Assets of 2.17% is on the low side compared to the rest of the industry. CNP is outperformed by 80.00% of its industry peers.
CNP's Return On Equity of 8.82% is on the low side compared to the rest of the industry. CNP is outperformed by 60.00% of its industry peers.
Looking at the Return On Invested Capital, with a value of 4.20%, CNP is in the better half of the industry, outperforming 64.00% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for CNP is in line with the industry average of 3.93%.
The 3 year average ROIC (4.06%) for CNP is below the current ROIC(4.20%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.17% | ||
| ROE | 8.82% | ||
| ROIC | 4.2% |
ROA(3y)2.38%
ROA(5y)1.6%
ROE(3y)9.52%
ROE(5y)6.39%
ROIC(3y)4.06%
ROIC(5y)3.84%
1.3 Margins
CNP has a Profit Margin of 10.80%. This is in the lower half of the industry: CNP underperforms 76.00% of its industry peers.
In the last couple of years the Profit Margin of CNP has grown nicely.
CNP has a Operating Margin (22.62%) which is in line with its industry peers.
In the last couple of years the Operating Margin of CNP has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 22.62% | ||
| PM (TTM) | 10.8% | ||
| GM | N/A |
OM growth 3Y12.16%
OM growth 5Y10.21%
PM growth 3Y-10.88%
PM growth 5Y5.76%
GM growth 3YN/A
GM growth 5YN/A
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), CNP is destroying value.
Compared to 1 year ago, CNP has more shares outstanding
The number of shares outstanding for CNP has been increased compared to 5 years ago.
Compared to 1 year ago, CNP has a worse debt to assets ratio.
2.2 Solvency
Based on the Altman-Z score of 0.82, we must say that CNP is in the distress zone and has some risk of bankruptcy.
The Altman-Z score of CNP (0.82) is comparable to the rest of the industry.
CNP has a Debt/Equity ratio of 1.90. This is a high value indicating a heavy dependency on external financing.
Looking at the Debt to Equity ratio, with a value of 1.90, CNP is doing worse than 76.00% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.9 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 0.82 |
ROIC/WACC0.65
WACC6.44%
2.3 Liquidity
A Current Ratio of 0.93 indicates that CNP may have some problems paying its short term obligations.
Looking at the Current ratio, with a value of 0.93, CNP is in the better half of the industry, outperforming 64.00% of the companies in the same industry.
A Quick Ratio of 0.79 indicates that CNP may have some problems paying its short term obligations.
Looking at the Quick ratio, with a value of 0.79, CNP is in the better half of the industry, outperforming 64.00% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.93 | ||
| Quick Ratio | 0.79 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 3.23% over the past year.
Measured over the past years, CNP shows a decrease in Earnings Per Share. The EPS has been decreasing by -1.98% on average per year.
The Revenue has been growing slightly by 4.76% in the past year.
CNP shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 2.70% yearly.
EPS 1Y (TTM)3.23%
EPS 3Y-0.41%
EPS 5Y-1.98%
EPS Q2Q%-3.64%
Revenue 1Y (TTM)4.76%
Revenue growth 3Y1.15%
Revenue growth 5Y2.7%
Sales Q2Q%11.45%
3.2 Future
The Earnings Per Share is expected to grow by 8.30% on average over the next years. This is quite good.
CNP is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 5.06% yearly.
EPS Next Y9.06%
EPS Next 2Y8.48%
EPS Next 3Y8.43%
EPS Next 5Y8.3%
Revenue Next Year3.78%
Revenue Next 2Y3.89%
Revenue Next 3Y3.97%
Revenue Next 5Y5.06%
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 accelerating.
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
CNP is valuated rather expensively with a Price/Earnings ratio of 22.46.
88.00% of the companies in the same industry are cheaper than CNP, based on the Price/Earnings ratio.
When comparing the Price/Earnings ratio of CNP to the average of the S&P500 Index (27.45), we can say CNP is valued inline with the index average.
A Price/Forward Earnings ratio of 18.85 indicates a rather expensive valuation of CNP.
CNP's Price/Forward Earnings ratio is rather expensive when compared to the industry. CNP is more expensive than 84.00% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of CNP to the average of the S&P500 Index (21.90), we can say CNP is valued inline with the index average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.46 | ||
| Fwd PE | 18.85 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of CNP indicates a slightly more expensive valuation: CNP is more expensive than 64.00% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 12.31 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates CNP does not grow enough to justify the current Price/Earnings ratio.
PEG (NY)2.48
PEG (5Y)N/A
EPS Next 2Y8.48%
EPS Next 3Y8.43%
5. Dividend
5.1 Amount
CNP has a Yearly Dividend Yield of 2.45%.
Compared to an average industry Dividend Yield of 3.76, CNP's dividend is way lower than its industry peers. On top of this 96.00% of the companies listed in the same industry pay a better dividend than CNP!
Compared to an average S&P500 Dividend Yield of 2.38, CNP has a dividend comparable with the average S&P500 company.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.45% |
5.2 History
The dividend of CNP decreases each year by -10.10%.
CNP has been paying a dividend for at least 10 years, so it has a reliable track record.
CNP has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)-10.1%
Div Incr Years3
Div Non Decr Years3
5.3 Sustainability
CNP pays out 55.80% of its income as dividend. This is a bit on the high side, but may be sustainable.
DP55.8%
EPS Next 2Y8.48%
EPS Next 3Y8.43%
35.94
+0.17 (+0.48%)
Chartmill FA Rating
GICS SectorUtilities
GICS IndustryGroupUtilities
GICS IndustryMulti-Utilities
Earnings (Last)
Earnings (Next)
Inst Owners99.28%
Inst Owner Change1.28%
Ins Owners0.15%
Ins Owner Change3.81%
Market Cap23.46B
Analysts71.82
Price Target39.61 (10.21%)
Short Float %4.47%
Short Ratio5.41
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.45% |
Yearly Dividend0.81
Dividend Growth(5Y)-10.1%
DP55.8%
Div Incr Years3
Div Non Decr Years3
Ex-Date
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-1.59%
Min EPS beat(2)-1.8%
Max EPS beat(2)-1.37%
EPS beat(4)1
Avg EPS beat(4)1.09%
Min EPS beat(4)-2.96%
Max EPS beat(4)10.48%
EPS beat(8)4
Avg EPS beat(8)2.48%
EPS beat(12)7
Avg EPS beat(12)3.46%
EPS beat(16)10
Avg EPS beat(16)7.93%
Revenue beat(2)1
Avg Revenue beat(2)0.29%
Min Revenue beat(2)-9.77%
Max Revenue beat(2)10.36%
Revenue beat(4)1
Avg Revenue beat(4)-1.1%
Min Revenue beat(4)-9.77%
Max Revenue beat(4)10.36%
Revenue beat(8)2
Avg Revenue beat(8)-4.88%
Revenue beat(12)5
Avg Revenue beat(12)1.32%
Revenue beat(16)9
Avg Revenue beat(16)3.74%
PT rev (1m)1.13%
PT rev (3m)13.5%
EPS NQ rev (1m)-3.3%
EPS NQ rev (3m)-0.97%
EPS NY rev (1m)0.08%
EPS NY rev (3m)0.12%
Revenue NQ rev (1m)-0.4%
Revenue NQ rev (3m)2.87%
Revenue NY rev (1m)-0.41%
Revenue NY rev (3m)-0.8%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.46 | ||
| Fwd PE | 18.85 | ||
| P/S | 2.62 | ||
| P/FCF | N/A | ||
| P/OCF | 11.67 | ||
| P/B | 2.14 | ||
| P/tB | 3.35 | ||
| EV/EBITDA | 12.31 |
EPS(TTM)1.6
EY4.45%
EPS(NY)1.91
Fwd EY5.3%
FCF(TTM)-4.68
FCFYN/A
OCF(TTM)3.08
OCFY8.57%
SpS13.7
BVpS16.78
TBVpS10.74
PEG (NY)2.48
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.17% | ||
| ROE | 8.82% | ||
| ROCE | 5.05% | ||
| ROIC | 4.2% | ||
| ROICexc | 4.4% | ||
| ROICexgc | 4.9% | ||
| OM | 22.62% | ||
| PM (TTM) | 10.8% | ||
| GM | N/A | ||
| FCFM | N/A |
ROA(3y)2.38%
ROA(5y)1.6%
ROE(3y)9.52%
ROE(5y)6.39%
ROIC(3y)4.06%
ROIC(5y)3.84%
ROICexc(3y)4.13%
ROICexc(5y)3.94%
ROICexgc(3y)4.67%
ROICexgc(5y)4.54%
ROCE(3y)4.87%
ROCE(5y)4.59%
ROICexcg growth 3Y3.86%
ROICexcg growth 5Y5.87%
ROICexc growth 3Y5.33%
ROICexc growth 5Y7.4%
OM growth 3Y12.16%
OM growth 5Y10.21%
PM growth 3Y-10.88%
PM growth 5Y5.76%
GM growth 3YN/A
GM growth 5YN/A
F-Score4
Asset Turnover0.2
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.9 | ||
| Debt/FCF | N/A | ||
| Debt/EBITDA | 6.03 | ||
| Cap/Depr | 351.84% | ||
| Cap/Sales | 56.61% | ||
| Interest Coverage | 2.33 | ||
| Cash Conversion | 58.09% | ||
| Profit Quality | N/A | ||
| Current Ratio | 0.93 | ||
| Quick Ratio | 0.79 | ||
| Altman-Z | 0.82 |
F-Score4
WACC6.44%
ROIC/WACC0.65
Cap/Depr(3y)323.61%
Cap/Depr(5y)285.85%
Cap/Sales(3y)50.08%
Cap/Sales(5y)44.62%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)3.23%
EPS 3Y-0.41%
EPS 5Y-1.98%
EPS Q2Q%-3.64%
EPS Next Y9.06%
EPS Next 2Y8.48%
EPS Next 3Y8.43%
EPS Next 5Y8.3%
Revenue 1Y (TTM)4.76%
Revenue growth 3Y1.15%
Revenue growth 5Y2.7%
Sales Q2Q%11.45%
Revenue Next Year3.78%
Revenue Next 2Y3.89%
Revenue Next 3Y3.97%
Revenue Next 5Y5.06%
EBIT growth 1Y10.25%
EBIT growth 3Y13.45%
EBIT growth 5Y13.19%
EBIT Next Year91.22%
EBIT Next 3Y31.62%
EBIT Next 5Y23.2%
FCF growth 1Y-74.1%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y-31.67%
OCF growth 3Y359.83%
OCF growth 5Y5.48%