FEDERATED HERMES INC (FHI) Stock Fundamental Analysis
NYSE:FHI - New York Stock Exchange, Inc. - US3142111034 - Common Stock - Currency: USD
We assign a fundamental rating of 6 out of 10 to FHI. FHI was compared to 223 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. FHI is valued quite cheap, but it does not seem to be growing. With these ratings, FHI could be worth investigating further for value investing!.
1. Profitability
1.1 Basic Checks
FHI had positive earnings in the past year.
In the past year FHI had a positive cash flow from operations.
Of the past 5 years FHI 4 years were profitable.
FHI had a positive operating cash flow in 4 of the past 5 years.
1.2 Ratios
The Return On Assets of FHI (16.10%) is better than 96.79% of its industry peers.
FHI's Return On Equity of 30.28% is amongst the best of the industry. FHI outperforms 96.79% of its industry peers.
FHI has a better Return On Invested Capital (22.66%) than 98.62% of its industry peers.
FHI had an Average Return On Invested Capital over the past 3 years of 16.38%. This is significantly above the industry average of 6.74%.
The last Return On Invested Capital (22.66%) for FHI is above the 3 year average (16.38%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 16.1% | ||
| ROE | 30.28% | ||
| ROIC | 22.66% |
ROA(3y)12.56%
ROA(5y)13.37%
ROE(3y)23.44%
ROE(5y)24.61%
ROIC(3y)16.38%
ROIC(5y)16.52%
1.3 Margins
The Profit Margin of FHI (16.43%) is comparable to the rest of the industry.
In the last couple of years the Profit Margin of FHI has remained more or less at the same level.
FHI has a Operating Margin (26.73%) which is in line with its industry peers.
FHI's Operating Margin has declined in the last couple of years.
Looking at the Gross Margin, with a value of 95.34%, FHI belongs to the top of the industry, outperforming 94.50% 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 | 26.73% | ||
| PM (TTM) | 16.43% | ||
| GM | 95.34% |
OM growth 3Y-4.78%
OM growth 5Y-3.04%
PM growth 3Y-6.48%
PM growth 5Y-1.02%
GM growth 3Y-0.18%
GM growth 5Y-0.11%
2. Health
2.1 Basic Checks
FHI has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.
2.2 Solvency
An Altman-Z score of 4.99 indicates that FHI is not in any danger for bankruptcy at the moment.
FHI's Altman-Z score of 4.99 is amongst the best of the industry. FHI outperforms 84.86% of its industry peers.
The Debt to FCF ratio of FHI is 1.01, which is an excellent value as it means it would take FHI, only 1.01 years of fcf income to pay off all of its debts.
FHI has a better Debt to FCF ratio (1.01) than 87.61% of its industry peers.
FHI has a Debt/Equity ratio of 0.32. This is a healthy value indicating a solid balance between debt and equity.
FHI's Debt to Equity ratio of 0.32 is fine compared to the rest of the industry. FHI outperforms 75.23% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.32 | ||
| Debt/FCF | 1.01 | ||
| Altman-Z | 4.99 |
ROIC/WACCN/A
WACCN/A
2.3 Liquidity
FHI has a Current Ratio of 2.75. This indicates that FHI is financially healthy and has no problem in meeting its short term obligations.
FHI has a Current ratio of 2.75. This is in the better half of the industry: FHI outperforms 74.77% of its industry peers.
FHI has a Quick Ratio of 2.75. This indicates that FHI is financially healthy and has no problem in meeting its short term obligations.
FHI has a Quick ratio of 2.75. This is in the better half of the industry: FHI outperforms 74.77% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.75 | ||
| Quick Ratio | 2.75 |
3. Growth
3.1 Past
FHI shows a slight negative growth in Earnings Per Share. In the last year, the EPS has decreased by -6.45%.
Measured over the past 5 years, FHI shows a small growth in Earnings Per Share. The EPS has been growing by 3.47% on average per year.
EPS 1Y (TTM)-6.45%
EPS 3Y3.71%
EPS 5Y3.47%
EPS Q2Q%8.33%
Revenue 1Y (TTM)N/A
Revenue growth 3YN/A
Revenue growth 5YN/A
Sales Q2Q%8.48%
3.2 Future
FHI is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 9.88% yearly.
Based on estimates for the next years, FHI will show a small growth in Revenue. The Revenue will grow by 2.49% on average per year.
EPS Next Y29.02%
EPS Next 2Y18.91%
EPS Next 3Y16.62%
EPS Next 5Y9.88%
Revenue Next Year6.33%
Revenue Next 2Y5.36%
Revenue Next 3Y5.07%
Revenue Next 5Y2.49%
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.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 12.36, the valuation of FHI can be described as correct.
Compared to the rest of the industry, the Price/Earnings ratio of FHI indicates a somewhat cheap valuation: FHI is cheaper than 60.55% of the companies listed in the same industry.
FHI's Price/Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 28.47.
FHI is valuated reasonably with a Price/Forward Earnings ratio of 9.58.
72.48% of the companies in the same industry are more expensive than FHI, based on the Price/Forward Earnings ratio.
FHI is valuated cheaply when we compare the Price/Forward Earnings ratio to 92.74, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.36 | ||
| Fwd PE | 9.58 |
4.2 Price Multiples
FHI's Enterprise Value to EBITDA ratio is rather cheap when compared to the industry. FHI is cheaper than 94.04% of the companies in the same industry.
69.72% of the companies in the same industry are more expensive than FHI, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 9.38 | ||
| EV/EBITDA | 5.1 |
4.3 Compensation for Growth
FHI's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
The decent profitability rating of FHI may justify a higher PE ratio.
FHI's earnings are expected to grow with 16.62% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.43
PEG (5Y)3.56
EPS Next 2Y18.91%
EPS Next 3Y16.62%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 3.15%, FHI has a reasonable but not impressive dividend return.
FHI's Dividend Yield is comparable with the industry average which is at 9.39.
FHI's Dividend Yield is a higher than the S&P500 average which is at 2.28.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.15% |
5.2 History
The dividend of FHI has a limited annual growth rate of 1.25%.
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)1.25%
Div Incr Years2
Div Non Decr Years3
5.3 Sustainability
FHI pays out 55.99% of its income as dividend. This is a bit on the high side, but may be sustainable.
FHI's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP55.99%
EPS Next 2Y18.91%
EPS Next 3Y16.62%
FEDERATED HERMES INC
NYSE:FHI (2/5/2025, 3:30:04 PM)
39.42
-0.26 (-0.66%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupFinancial Services
GICS IndustryCapital Markets
Earnings (Last)
Earnings (Next)
Inst Owners80.27%
Inst Owner ChangeN/A
Ins Owners3.75%
Ins Owner Change-2.18%
Market Cap3.22B
Analysts70
Price Target42.67 (8.24%)
Short Float %3.52%
Short Ratio4.28
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.15% |
Yearly Dividend1.13
Dividend Growth(5Y)1.25%
DP55.99%
Div Incr Years2
Div Non Decr Years3
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-31.67%
Min EPS beat(2)-77.66%
Max EPS beat(2)14.33%
EPS beat(4)3
Avg EPS beat(4)-12.22%
Min EPS beat(4)-77.66%
Max EPS beat(4)14.47%
EPS beat(8)6
Avg EPS beat(8)-3.43%
EPS beat(12)7
Avg EPS beat(12)-3.31%
EPS beat(16)10
Avg EPS beat(16)-1.61%
Revenue beat(2)0
Avg Revenue beat(2)-0.81%
Min Revenue beat(2)-1.18%
Max Revenue beat(2)-0.44%
Revenue beat(4)0
Avg Revenue beat(4)-1.54%
Min Revenue beat(4)-2.36%
Max Revenue beat(4)-0.44%
Revenue beat(8)2
Avg Revenue beat(8)0.17%
Revenue beat(12)4
Avg Revenue beat(12)6.72%
Revenue beat(16)6
Avg Revenue beat(16)4.93%
PT rev (1m)-3.04%
PT rev (3m)12.56%
EPS NQ rev (1m)-0.37%
EPS NQ rev (3m)5.36%
EPS NY rev (1m)-0.02%
EPS NY rev (3m)-1.11%
Revenue NQ rev (1m)-0.08%
Revenue NQ rev (3m)1.2%
Revenue NY rev (1m)-0.06%
Revenue NY rev (3m)0.31%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.36 | ||
| Fwd PE | 9.58 | ||
| P/S | 1.62 | ||
| P/FCF | 9.38 | ||
| P/OCF | 9.23 | ||
| P/B | 2.98 | ||
| P/tB | N/A | ||
| EV/EBITDA | 5.1 |
EPS(TTM)3.19
EY8.09%
EPS(NY)4.12
Fwd EY10.44%
FCF(TTM)4.2
FCFY10.66%
OCF(TTM)4.27
OCFY10.84%
SpS24.41
BVpS13.24
TBVpS-0.89
PEG (NY)0.43
PEG (5Y)3.56
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 16.1% | ||
| ROE | 30.28% | ||
| ROCE | 30.08% | ||
| ROIC | 22.66% | ||
| ROICexc | 33.25% | ||
| ROICexgc | 755.2% | ||
| OM | 26.73% | ||
| PM (TTM) | 16.43% | ||
| GM | 95.34% | ||
| FCFM | 17.22% |
ROA(3y)12.56%
ROA(5y)13.37%
ROE(3y)23.44%
ROE(5y)24.61%
ROIC(3y)16.38%
ROIC(5y)16.52%
ROICexc(3y)22.88%
ROICexc(5y)22.38%
ROICexgc(3y)756.88%
ROICexgc(5y)598.3%
ROCE(3y)21.74%
ROCE(5y)21.92%
ROICexcg growth 3Y24.29%
ROICexcg growth 5Y-5.74%
ROICexc growth 3Y1.25%
ROICexc growth 5Y2.57%
OM growth 3Y-4.78%
OM growth 5Y-3.04%
PM growth 3Y-6.48%
PM growth 5Y-1.02%
GM growth 3Y-0.18%
GM growth 5Y-0.11%
F-Score6
Asset Turnover0.98
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.32 | ||
| Debt/FCF | 1.01 | ||
| Debt/EBITDA | 0.63 | ||
| Cap/Depr | 24.6% | ||
| Cap/Sales | 0.28% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 62.79% | ||
| Profit Quality | 104.8% | ||
| Current Ratio | 2.75 | ||
| Quick Ratio | 2.75 | ||
| Altman-Z | 4.99 |
F-Score6
WACCN/A
ROIC/WACCN/A
Cap/Depr(3y)26.6%
Cap/Depr(5y)36.98%
Cap/Sales(3y)0.53%
Cap/Sales(5y)0.73%
Profit Quality(3y)102.89%
Profit Quality(5y)109.08%
High Growth Momentum
Growth
EPS 1Y (TTM)-6.45%
EPS 3Y3.71%
EPS 5Y3.47%
EPS Q2Q%8.33%
EPS Next Y29.02%
EPS Next 2Y18.91%
EPS Next 3Y16.62%
EPS Next 5Y9.88%
Revenue 1Y (TTM)N/A
Revenue growth 3YN/A
Revenue growth 5YN/A
Sales Q2Q%8.48%
Revenue Next Year6.33%
Revenue Next 2Y5.36%
Revenue Next 3Y5.07%
Revenue Next 5Y2.49%
EBIT growth 1Y11.82%
EBIT growth 3Y-1.38%
EBIT growth 5Y3.96%
EBIT Next Year10.45%
EBIT Next 3Y8.94%
EBIT Next 5Y8%
FCF growth 1Y35.27%
FCF growth 3Y-5.46%
FCF growth 5Y9.97%
OCF growth 1Y33.92%
OCF growth 3Y-5.81%
OCF growth 5Y8.61%