FEDERATED HERMES INC (FHI) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:FHI - US3142111034 - Common Stock
52.59 USD
+0.08 (+0.15%)
FHI gets a fundamental rating of 7 out of 10. The analysis compared the fundamentals against 237 industry peers in the Capital Markets industry. FHI scores excellent points on both the profitability and health parts. This is a solid base for a good stock. A decent growth rate in combination with a cheap valuation! Better keep an eye on FHI. This makes FHI very considerable for value and quality investing!
1. Profitability
1.1 Basic Checks
- In the past year FHI was profitable.
- In the past year FHI had a positive cash flow from operations.
- In the past 5 years FHI has always been profitable.
- FHI had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
- FHI's Return On Assets of 16.68% is amongst the best of the industry. FHI outperforms 95.78% of its industry peers.
- FHI has a better Return On Equity (30.66%) than 95.78% of its industry peers.
- With an excellent Return On Invested Capital value of 18.60%, FHI belongs to the best of the industry, outperforming 94.51% of the companies in the same industry.
- The Average Return On Invested Capital over the past 3 years for FHI is significantly above the industry average of 7.27%.
- The 3 year average ROIC (16.23%) for FHI is below the current ROIC(18.60%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 16.68% | ||
| ROE | 30.66% | ||
| ROIC | 18.6% |
ROA(3y)12.38%
ROA(5y)13.04%
ROE(3y)23.49%
ROE(5y)24.27%
ROIC(3y)16.23%
ROIC(5y)16.25%
1.3 Margins
- FHI has a Profit Margin (20.80%) which is comparable to the rest of the industry.
- In the last couple of years the Profit Margin of FHI has declined.
- The Operating Margin of FHI (28.35%) is comparable to the rest of the industry.
- FHI's Operating Margin has been stable in the last couple of years.
- Looking at the Gross Margin, with a value of 95.56%, FHI belongs to the top of the industry, outperforming 96.20% of the companies in the same industry.
- In the last couple of years the Gross Margin of FHI has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 28.35% | ||
| PM (TTM) | 20.8% | ||
| GM | 95.56% |
OM growth 3Y-3.42%
OM growth 5Y0.08%
PM growth 3Y-7.67%
PM growth 5Y-4.49%
GM growth 3Y-0.05%
GM growth 5Y-0.31%
2. Health
2.1 Basic Checks
- The number of shares outstanding for FHI has been reduced compared to 1 year ago.
- The number of shares outstanding for FHI has been reduced compared to 5 years ago.
- The debt/assets ratio for FHI is higher compared to a year ago.
2.2 Solvency
- FHI has an Altman-Z score of 5.25. This indicates that FHI is financially healthy and has little risk of bankruptcy at the moment.
- FHI has a Altman-Z score of 5.25. This is amongst the best in the industry. FHI outperforms 85.65% of its industry peers.
- The Debt to FCF ratio of FHI is 1.34, which is an excellent value as it means it would take FHI, only 1.34 years of fcf income to pay off all of its debts.
- FHI has a Debt to FCF ratio of 1.34. This is amongst the best in the industry. FHI outperforms 88.61% of its industry peers.
- A Debt/Equity ratio of 0.29 indicates that FHI is not too dependend on debt financing.
- With a decent Debt to Equity ratio value of 0.29, FHI is doing good in the industry, outperforming 73.42% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.29 | ||
| Debt/FCF | 1.34 | ||
| Altman-Z | 5.25 |
ROIC/WACCN/A
WACCN/A
2.3 Liquidity
- A Current Ratio of 3.13 indicates that FHI has no problem at all paying its short term obligations.
- FHI's Current ratio of 3.13 is amongst the best of the industry. FHI outperforms 81.43% of its industry peers.
- A Quick Ratio of 3.13 indicates that FHI has no problem at all paying its short term obligations.
- FHI has a Quick ratio of 3.13. This is amongst the best in the industry. FHI outperforms 81.43% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 3.13 | ||
| Quick Ratio | 3.13 |
3. Growth
3.1 Past
- FHI shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 54.02%, which is quite impressive.
- The Earnings Per Share has been growing slightly by 3.47% on average over the past years.
- FHI shows a very negative growth in Revenue. In the last year, the Revenue has decreased by -12.36%.
- The Revenue has been growing slightly by 4.26% on average over the past years.
EPS 1Y (TTM)54.02%
EPS 3Y3.71%
EPS 5Y3.47%
EPS Q2Q%26.42%
Revenue 1Y (TTM)-12.36%
Revenue growth 3Y7.92%
Revenue growth 5Y4.26%
Sales Q2Q%14.93%
3.2 Future
- The Earnings Per Share is expected to grow by 15.10% on average over the next years. This is quite good.
- FHI is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 4.00% yearly.
EPS Next Y54.58%
EPS Next 2Y26.74%
EPS Next 3Y21.54%
EPS Next 5Y15.1%
Revenue Next Year9.8%
Revenue Next 2Y8.72%
Revenue Next 3Y7.18%
Revenue Next 5Y4%
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
- Based on the Price/Earnings ratio of 10.98, the valuation of FHI can be described as reasonable.
- Based on the Price/Earnings ratio, FHI is valued a bit cheaper than the industry average as 63.71% of the companies are valued more expensively.
- The average S&P500 Price/Earnings ratio is at 28.82. FHI is valued rather cheaply when compared to this.
- The Price/Forward Earnings ratio is 10.26, which indicates a very decent valuation of FHI.
- 73.00% of the companies in the same industry are more expensive than FHI, based on the Price/Forward Earnings ratio.
- FHI's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 25.95.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 10.98 | ||
| Fwd PE | 10.26 |
4.2 Price Multiples
- Based on the Enterprise Value to EBITDA ratio, FHI is valued cheaper than 91.98% of the companies in the same industry.
- Based on the Price/Free Cash Flow ratio, FHI is valued a bit cheaper than 68.78% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 15.74 | ||
| EV/EBITDA | 7.01 |
4.3 Compensation for Growth
- The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
- FHI has an outstanding profitability rating, which may justify a higher PE ratio.
- A more expensive valuation may be justified as FHI's earnings are expected to grow with 21.54% in the coming years.
PEG (NY)0.2
PEG (5Y)3.17
EPS Next 2Y26.74%
EPS Next 3Y21.54%
5. Dividend
5.1 Amount
- FHI has a Yearly Dividend Yield of 2.49%. Purely for dividend investing, there may be better candidates out there.
- Compared to an average industry Dividend Yield of 5.87, FHI has a dividend in line with its industry peers.
- FHI's Dividend Yield is a higher than the S&P500 average which is at 1.82.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.49% |
5.2 History
- On average, the dividend of FHI grows each year by 15.47%, which is quite nice.
- FHI has paid a dividend for at least 10 years, which is a reliable track record.
- FHI has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)15.47%
Div Incr Years2
Div Non Decr Years3
5.3 Sustainability
- FHI pays out 28.50% of its income as dividend. This is a sustainable payout ratio.
- The dividend of FHI is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP28.5%
EPS Next 2Y26.74%
EPS Next 3Y21.54%
FEDERATED HERMES INC / FHI FAQ
Can you provide the ChartMill fundamental rating for FEDERATED HERMES INC?
ChartMill assigns a fundamental rating of 7 / 10 to FHI.
What is the valuation status for FHI stock?
ChartMill assigns a valuation rating of 8 / 10 to FEDERATED HERMES INC (FHI). This can be considered as Undervalued.
How profitable is FEDERATED HERMES INC (FHI) stock?
FEDERATED HERMES INC (FHI) has a profitability rating of 8 / 10.
What is the valuation of FEDERATED HERMES INC based on its PE and PB ratios?
The Price/Earnings (PE) ratio for FEDERATED HERMES INC (FHI) is 10.98 and the Price/Book (PB) ratio is 3.44.
Is the dividend of FEDERATED HERMES INC sustainable?
The dividend rating of FEDERATED HERMES INC (FHI) is 5 / 10 and the dividend payout ratio is 28.5%.