FIRSTENERGY CORP (FE) Stock Fundamental Analysis
NYSE:FE - New York Stock Exchange, Inc. - US3379321074 - Common Stock - Currency: USD
We assign a fundamental rating of 3 out of 10 to FE. FE was compared to 46 industry peers in the Electric Utilities industry. FE has a medium profitability rating, but doesn't score so well on its financial health evaluation. While showing a medium growth rate, FE is valued expensive at the moment. FE also has an excellent dividend rating.
1. Profitability
1.1 Basic Checks
In the past year FE was profitable.
FE had a positive operating cash flow in the past year.
In the past 5 years FE has always been profitable.
In the past 5 years FE always reported a positive cash flow from operatings.
1.2 Ratios
FE has a worse Return On Assets (1.88%) than 63.04% of its industry peers.
The Return On Equity of FE (7.85%) is worse than 60.87% of its industry peers.
FE has a better Return On Invested Capital (3.91%) than 67.39% of its industry peers.
The Average Return On Invested Capital over the past 3 years for FE is in line with the industry average of 4.92%.
The last Return On Invested Capital (3.91%) for FE is above the 3 year average (3.82%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.88% | ||
| ROE | 7.85% | ||
| ROIC | 3.91% |
ROA(3y)1.67%
ROA(5y)2.05%
ROE(3y)7.47%
ROE(5y)10.42%
ROIC(3y)3.82%
ROIC(5y)3.73%
1.3 Margins
FE's Profit Margin of 7.26% is on the low side compared to the rest of the industry. FE is outperformed by 63.04% of its industry peers.
In the last couple of years the Profit Margin of FE has declined.
The Operating Margin of FE (17.63%) is worse than 60.87% of its industry peers.
In the last couple of years the Operating Margin of FE has declined.
Looking at the Gross Margin, with a value of 70.96%, FE is in the better half of the industry, outperforming 69.57% of the companies in the same industry.
In the last couple of years the Gross Margin of FE has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 17.63% | ||
| PM (TTM) | 7.26% | ||
| GM | 70.96% |
OM growth 3Y6.67%
OM growth 5Y-4.97%
PM growth 3Y-14.28%
PM growth 5Y-2.47%
GM growth 3Y-1.11%
GM growth 5Y-0.69%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), FE is destroying value.
The number of shares outstanding for FE has been increased compared to 1 year ago.
Compared to 5 years ago, FE has more shares outstanding
The debt/assets ratio for FE has been reduced compared to a year ago.
2.2 Solvency
Based on the Altman-Z score of 0.73, we must say that FE is in the distress zone and has some risk of bankruptcy.
FE's Altman-Z score of 0.73 is in line compared to the rest of the industry. FE outperforms 52.17% of its industry peers.
A Debt/Equity ratio of 1.85 is on the high side and indicates that FE has dependencies on debt financing.
With a Debt to Equity ratio value of 1.85, FE is not doing good in the industry: 67.39% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.85 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 0.73 |
ROIC/WACC0.63
WACC6.18%
2.3 Liquidity
FE has a Current Ratio of 0.56. This is a bad value and indicates that FE is not financially healthy enough and could expect problems in meeting its short term obligations.
FE's Current ratio of 0.56 is on the low side compared to the rest of the industry. FE is outperformed by 67.39% of its industry peers.
A Quick Ratio of 0.45 indicates that FE may have some problems paying its short term obligations.
FE has a Quick ratio of 0.45. This is comparable to the rest of the industry: FE outperforms 43.48% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.56 | ||
| Quick Ratio | 0.45 |
3. Growth
3.1 Past
FE shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 2.33%.
The Earnings Per Share has been growing slightly by 0.31% on average over the past years.
Looking at the last year, FE shows a very negative growth in Revenue. The Revenue has decreased by -16.33% in the last year.
Measured over the past years, FE shows a small growth in Revenue. The Revenue has been growing by 4.07% on average per year.
EPS 1Y (TTM)2.33%
EPS 3Y0.25%
EPS 5Y0.31%
EPS Q2Q%8.06%
Revenue 1Y (TTM)-16.33%
Revenue growth 3Y6.57%
Revenue growth 5Y4.07%
Sales Q2Q%0.99%
3.2 Future
FE is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 5.42% yearly.
Based on estimates for the next years, FE will show a small growth in Revenue. The Revenue will grow by 3.66% on average per year.
EPS Next Y-0.65%
EPS Next 2Y3.02%
EPS Next 3Y4.32%
EPS Next 5Y5.42%
Revenue Next Year1.27%
Revenue Next 2Y2.46%
Revenue Next 3Y2.54%
Revenue Next 5Y3.66%
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 stable: in the next years the growth will be about the same than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 15.98, the valuation of FE can be described as correct.
Based on the Price/Earnings ratio, FE is valued a bit cheaper than the industry average as 69.57% of the companies are valued more expensively.
Compared to an average S&P500 Price/Earnings ratio of 28.29, FE is valued a bit cheaper.
Based on the Price/Forward Earnings ratio of 16.08, the valuation of FE can be described as correct.
71.74% of the companies in the same industry are more expensive than FE, based on the Price/Forward Earnings ratio.
The average S&P500 Price/Forward Earnings ratio is at 21.08. FE is valued slightly cheaper when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.98 | ||
| Fwd PE | 16.08 |
4.2 Price Multiples
FE's Enterprise Value to EBITDA ratio is in line with the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 12.01 |
4.3 Compensation for Growth
PEG (NY)N/A
PEG (5Y)52.04
EPS Next 2Y3.02%
EPS Next 3Y4.32%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 4.24%, FE is a good candidate for dividend investing.
FE's Dividend Yield is rather good when compared to the industry average which is at 3.49. FE pays more dividend than 80.43% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 2.52, FE pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.24% |
5.2 History
The dividend of FE has a limited annual growth rate of 1.59%.
FE has been paying a dividend for at least 10 years, so it has a reliable track record.
FE has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)1.59%
Div Incr Years2
Div Non Decr Years10
5.3 Sustainability
99.18% of the earnings are spent on dividend by FE. This is not a sustainable payout ratio.
FE's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP99.18%
EPS Next 2Y3.02%
EPS Next 3Y4.32%
42.02
+1.22 (+2.99%)
Chartmill FA Rating
GICS SectorUtilities
GICS IndustryGroupUtilities
GICS IndustryElectric Utilities
Earnings (Last)
Earnings (Next)
Inst Owners86.29%
Inst Owner Change0.07%
Ins Owners0.1%
Ins Owner Change2.49%
Market Cap24.25B
Analysts74.62
Price Target44.44 (5.76%)
Short Float %2.36%
Short Ratio2.49
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.24% |
Yearly Dividend1.69
Dividend Growth(5Y)1.59%
DP99.18%
Div Incr Years2
Div Non Decr Years10
Ex-Date
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-7.76%
Min EPS beat(2)-7.9%
Max EPS beat(2)-7.63%
EPS beat(4)0
Avg EPS beat(4)-5.62%
Min EPS beat(4)-7.9%
Max EPS beat(4)-2.24%
EPS beat(8)3
Avg EPS beat(8)-3.01%
EPS beat(12)3
Avg EPS beat(12)-3.34%
EPS beat(16)5
Avg EPS beat(16)-2.77%
Revenue beat(2)0
Avg Revenue beat(2)-15.75%
Min Revenue beat(2)-24.16%
Max Revenue beat(2)-7.33%
Revenue beat(4)0
Avg Revenue beat(4)-9.56%
Min Revenue beat(4)-24.16%
Max Revenue beat(4)-0.96%
Revenue beat(8)2
Avg Revenue beat(8)-5.25%
Revenue beat(12)6
Avg Revenue beat(12)0.13%
Revenue beat(16)6
Avg Revenue beat(16)-1.21%
PT rev (1m)-0.84%
PT rev (3m)-7.98%
EPS NQ rev (1m)9.71%
EPS NQ rev (3m)-1.46%
EPS NY rev (1m)-12.07%
EPS NY rev (3m)-12.08%
Revenue NQ rev (1m)2.06%
Revenue NQ rev (3m)2.12%
Revenue NY rev (1m)-2.45%
Revenue NY rev (3m)-3.37%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.98 | ||
| Fwd PE | 16.08 | ||
| P/S | 1.8 | ||
| P/FCF | N/A | ||
| P/OCF | 8.39 | ||
| P/B | 1.95 | ||
| P/tB | 3.55 | ||
| EV/EBITDA | 12.01 |
EPS(TTM)2.63
EY6.26%
EPS(NY)2.61
Fwd EY6.22%
FCF(TTM)-1.97
FCFYN/A
OCF(TTM)5.01
OCFY11.92%
SpS23.34
BVpS21.58
TBVpS11.85
PEG (NY)N/A
PEG (5Y)52.04
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.88% | ||
| ROE | 7.85% | ||
| ROCE | 5.05% | ||
| ROIC | 3.91% | ||
| ROICexc | 3.92% | ||
| ROICexgc | 4.44% | ||
| OM | 17.63% | ||
| PM (TTM) | 7.26% | ||
| GM | 70.96% | ||
| FCFM | N/A |
ROA(3y)1.67%
ROA(5y)2.05%
ROE(3y)7.47%
ROE(5y)10.42%
ROIC(3y)3.82%
ROIC(5y)3.73%
ROICexc(3y)3.84%
ROICexc(5y)3.79%
ROICexgc(3y)4.39%
ROICexgc(5y)4.37%
ROCE(3y)4.93%
ROCE(5y)4.84%
ROICexcg growth 3Y5.98%
ROICexcg growth 5Y-6.21%
ROICexc growth 3Y6.95%
ROICexc growth 5Y-5.5%
OM growth 3Y6.67%
OM growth 5Y-4.97%
PM growth 3Y-14.28%
PM growth 5Y-2.47%
GM growth 3Y-1.11%
GM growth 5Y-0.69%
F-Score6
Asset Turnover0.26
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.85 | ||
| Debt/FCF | N/A | ||
| Debt/EBITDA | 5.82 | ||
| Cap/Depr | 253.78% | ||
| Cap/Sales | 29.91% | ||
| Interest Coverage | 2.24 | ||
| Cash Conversion | 72.95% | ||
| Profit Quality | N/A | ||
| Current Ratio | 0.56 | ||
| Quick Ratio | 0.45 | ||
| Altman-Z | 0.73 |
F-Score6
WACC6.18%
ROIC/WACC0.63
Cap/Depr(3y)241.74%
Cap/Depr(5y)219.91%
Cap/Sales(3y)26.04%
Cap/Sales(5y)24.94%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)2.33%
EPS 3Y0.25%
EPS 5Y0.31%
EPS Q2Q%8.06%
EPS Next Y-0.65%
EPS Next 2Y3.02%
EPS Next 3Y4.32%
EPS Next 5Y5.42%
Revenue 1Y (TTM)-16.33%
Revenue growth 3Y6.57%
Revenue growth 5Y4.07%
Sales Q2Q%0.99%
Revenue Next Year1.27%
Revenue Next 2Y2.46%
Revenue Next 3Y2.54%
Revenue Next 5Y3.66%
EBIT growth 1Y-15.69%
EBIT growth 3Y13.67%
EBIT growth 5Y-1.1%
EBIT Next Year67.06%
EBIT Next 3Y24.76%
EBIT Next 5Y15.85%
FCF growth 1Y42.15%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y108.44%
OCF growth 3Y0.94%
OCF growth 5Y3.22%