FEDERATED HERMES INC (FHI) Stock Fundamental Analysis
NYSE:FHI - New York Stock Exchange, Inc. - US3142111034 - Common Stock - Currency: USD
FHI gets a fundamental rating of 7 out of 10. The analysis compared the fundamentals against 233 industry peers in the Capital Markets industry. FHI gets an excellent profitability rating and is at the same time showing great financial health properties. FHI may be a bit undervalued, certainly considering the very reasonable score on growth This makes FHI very considerable for value investing!
1. Profitability
1.1 Basic Checks
In the past year FHI was profitable.
FHI had a positive operating cash flow in the past year.
FHI had positive earnings in each of the past 5 years.
FHI had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
With an excellent Return On Assets value of 17.65%, FHI belongs to the best of the industry, outperforming 97.42% of the companies in the same industry.
The Return On Equity of FHI (32.83%) is better than 96.14% of its industry peers.
FHI's Return On Invested Capital of 22.88% is amongst the best of the industry. FHI outperforms 98.28% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for FHI is significantly above the industry average of 7.84%.
The last Return On Invested Capital (22.88%) for FHI is above the 3 year average (16.23%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 17.65% | ||
| ROE | 32.83% | ||
| ROIC | 22.88% |
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
With a Profit Margin value of 17.15%, FHI perfoms like the industry average, outperforming 55.79% of the companies in the same industry.
FHI's Profit Margin has declined in the last couple of years.
The Operating Margin of FHI (27.37%) is comparable to the rest of the industry.
In the last couple of years the Operating Margin of FHI has remained more or less at the same level.
FHI's Gross Margin of 95.30% is amongst the best of the industry. FHI outperforms 95.28% of its industry peers.
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 | 27.37% | ||
| PM (TTM) | 17.15% | ||
| GM | 95.3% |
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
Compared to 1 year ago, FHI has less shares outstanding
FHI has less shares outstanding than it did 5 years ago.
The debt/assets ratio for FHI is higher compared to a year ago.
2.2 Solvency
An Altman-Z score of 5.49 indicates that FHI is not in any danger for bankruptcy at the moment.
FHI's Altman-Z score of 5.49 is amongst the best of the industry. FHI outperforms 85.84% of its industry peers.
The Debt to FCF ratio of FHI is 1.02, which is an excellent value as it means it would take FHI, only 1.02 years of fcf income to pay off all of its debts.
FHI has a better Debt to FCF ratio (1.02) than 87.98% of its industry peers.
A Debt/Equity ratio of 0.32 indicates that FHI is not too dependend on debt financing.
FHI's Debt to Equity ratio of 0.32 is fine compared to the rest of the industry. FHI outperforms 74.68% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.32 | ||
| Debt/FCF | 1.02 | ||
| Altman-Z | 5.49 |
ROIC/WACCN/A
WACCN/A
2.3 Liquidity
FHI has a Current Ratio of 3.04. This indicates that FHI is financially healthy and has no problem in meeting its short term obligations.
The Current ratio of FHI (3.04) is better than 79.83% of its industry peers.
A Quick Ratio of 3.04 indicates that FHI has no problem at all paying its short term obligations.
FHI's Quick ratio of 3.04 is fine compared to the rest of the industry. FHI outperforms 79.83% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 3.04 | ||
| Quick Ratio | 3.04 |
3. Growth
3.1 Past
FHI shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 0.85%.
The Earnings Per Share has been growing slightly by 3.47% on average over the past years.
Looking at the last year, FHI shows a small growth in Revenue. The Revenue has grown by 2.68% in the last year.
Measured over the past years, FHI shows a small growth in Revenue. The Revenue has been growing by 4.26% on average per year.
EPS 1Y (TTM)0.85%
EPS 3Y3.71%
EPS 5Y3.47%
EPS Q2Q%40.45%
Revenue 1Y (TTM)2.68%
Revenue growth 3Y7.92%
Revenue growth 5Y4.26%
Sales Q2Q%6.85%
3.2 Future
The Earnings Per Share is expected to grow by 12.89% on average over the next years. This is quite good.
The Revenue is expected to grow by 2.46% on average over the next years.
EPS Next Y38.25%
EPS Next 2Y18.47%
EPS Next 3Y14.57%
EPS Next 5Y12.89%
Revenue Next Year4.87%
Revenue Next 2Y4.17%
Revenue Next 3Y4.13%
Revenue Next 5Y2.46%
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 decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 12.84, FHI is valued correctly.
Based on the Price/Earnings ratio, FHI is valued a bit cheaper than 61.80% of the companies in the same industry.
FHI is valuated cheaply when we compare the Price/Earnings ratio to 27.29, which is the current average of the S&P500 Index.
With a Price/Forward Earnings ratio of 10.18, the valuation of FHI can be described as very reasonable.
Based on the Price/Forward Earnings ratio, FHI is valued a bit cheaper than the industry average as 72.53% of the companies are valued more expensively.
FHI is valuated cheaply when we compare the Price/Forward Earnings ratio to 21.74, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.84 | ||
| Fwd PE | 10.18 |
4.2 Price Multiples
FHI's Enterprise Value to EBITDA ratio is rather cheap when compared to the industry. FHI is cheaper than 93.13% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, FHI is valued a bit cheaper than the industry average as 75.54% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 10.53 | ||
| EV/EBITDA | 5.56 |
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.
The excellent profitability rating of FHI may justify a higher PE ratio.
FHI's earnings are expected to grow with 14.57% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.34
PEG (5Y)3.7
EPS Next 2Y18.47%
EPS Next 3Y14.57%
5. Dividend
5.1 Amount
FHI has a Yearly Dividend Yield of 2.99%. Purely for dividend investing, there may be better candidates out there.
FHI's Dividend Yield is comparable with the industry average which is at 8.10.
Compared to an average S&P500 Dividend Yield of 2.37, FHI pays a bit more dividend than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.99% |
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
52.75% of the earnings are spent on dividend by FHI. This is a bit on the high side, but may be sustainable.
The dividend of FHI is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP52.75%
EPS Next 2Y18.47%
EPS Next 3Y14.57%
45.59
+0.05 (+0.11%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupFinancial Services
GICS IndustryCapital Markets
Earnings (Last)
Earnings (Next)
Inst Owners81.98%
Inst Owner ChangeN/A
Ins Owners3.99%
Ins Owner Change3.19%
Market Cap3.61B
Analysts52
Price Target43.35 (-4.91%)
Short Float %3.63%
Short Ratio3.17
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.99% |
Yearly Dividend2.22
Dividend Growth(5Y)15.47%
DP52.75%
Div Incr Years2
Div Non Decr Years3
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)20.36%
Min EPS beat(2)5.9%
Max EPS beat(2)34.82%
EPS beat(4)3
Avg EPS beat(4)-5.65%
Min EPS beat(4)-77.66%
Max EPS beat(4)34.82%
EPS beat(8)6
Avg EPS beat(8)-1%
EPS beat(12)9
Avg EPS beat(12)0.99%
EPS beat(16)11
Avg EPS beat(16)0.21%
Revenue beat(2)1
Avg Revenue beat(2)-0.19%
Min Revenue beat(2)-0.49%
Max Revenue beat(2)0.11%
Revenue beat(4)1
Avg Revenue beat(4)-0.5%
Min Revenue beat(4)-1.18%
Max Revenue beat(4)0.11%
Revenue beat(8)2
Avg Revenue beat(8)0.19%
Revenue beat(12)5
Avg Revenue beat(12)7.54%
Revenue beat(16)6
Avg Revenue beat(16)4.82%
PT rev (1m)4.08%
PT rev (3m)4.94%
EPS NQ rev (1m)0.48%
EPS NQ rev (3m)-0.9%
EPS NY rev (1m)2.82%
EPS NY rev (3m)7.45%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-2.07%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-2.21%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.84 | ||
| Fwd PE | 10.18 | ||
| P/S | 1.75 | ||
| P/FCF | 10.53 | ||
| P/OCF | 10.4 | ||
| P/B | 3.35 | ||
| P/tB | N/A | ||
| EV/EBITDA | 5.56 |
EPS(TTM)3.55
EY7.79%
EPS(NY)4.48
Fwd EY9.82%
FCF(TTM)4.33
FCFY9.49%
OCF(TTM)4.38
OCFY9.62%
SpS26.04
BVpS13.6
TBVpS-0.79
PEG (NY)0.34
PEG (5Y)3.7
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 17.65% | ||
| ROE | 32.83% | ||
| ROCE | 31.69% | ||
| ROIC | 22.88% | ||
| ROICexc | 32.91% | ||
| ROICexgc | 413.75% | ||
| OM | 27.37% | ||
| PM (TTM) | 17.15% | ||
| GM | 95.3% | ||
| FCFM | 16.62% |
ROA(3y)12.38%
ROA(5y)13.04%
ROE(3y)23.49%
ROE(5y)24.27%
ROIC(3y)16.23%
ROIC(5y)16.25%
ROICexc(3y)23.98%
ROICexc(5y)23%
ROICexgc(3y)1021.49%
ROICexgc(5y)802.2%
ROCE(3y)22.48%
ROCE(5y)22.5%
ROICexcg growth 3Y38.23%
ROICexcg growth 5Y38.01%
ROICexc growth 3Y9.02%
ROICexc growth 5Y7%
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%
F-Score5
Asset Turnover1.03
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.32 | ||
| Debt/FCF | 1.02 | ||
| Debt/EBITDA | 0.59 | ||
| Cap/Depr | 19.92% | ||
| Cap/Sales | 0.21% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 59.19% | ||
| Profit Quality | 96.9% | ||
| Current Ratio | 3.04 | ||
| Quick Ratio | 3.04 | ||
| Altman-Z | 5.49 |
F-Score5
WACCN/A
ROIC/WACCN/A
Cap/Depr(3y)21%
Cap/Depr(5y)28.99%
Cap/Sales(3y)0.35%
Cap/Sales(5y)0.55%
Profit Quality(3y)126.81%
Profit Quality(5y)111.36%
High Growth Momentum
Growth
EPS 1Y (TTM)0.85%
EPS 3Y3.71%
EPS 5Y3.47%
EPS Q2Q%40.45%
EPS Next Y38.25%
EPS Next 2Y18.47%
EPS Next 3Y14.57%
EPS Next 5Y12.89%
Revenue 1Y (TTM)2.68%
Revenue growth 3Y7.92%
Revenue growth 5Y4.26%
Sales Q2Q%6.85%
Revenue Next Year4.87%
Revenue Next 2Y4.17%
Revenue Next 3Y4.13%
Revenue Next 5Y2.46%
EBIT growth 1Y12.71%
EBIT growth 3Y4.23%
EBIT growth 5Y4.35%
EBIT Next Year62.14%
EBIT Next 3Y11.97%
EBIT Next 5Y8.11%
FCF growth 1Y-0.86%
FCF growth 3Y28.89%
FCF growth 5Y1.38%
OCF growth 1Y-0.51%
OCF growth 3Y26.7%
OCF growth 5Y0.69%