Holly Energy Partners LP (HEP) Fundamental Analysis & Valuation

NYSE:HEP • US4357631070

Current stock price

20.45 USD
-0.16 (-0.78%)
At close:
20.55 USD
+0.1 (+0.49%)
After Hours:

This HEP fundamental analysis includes valuation metrics, fair value assessment, financial health analysis, profitability trends, growth metrics and dividend sustainability analysis.

4

1. HEP Profitability Analysis

1.1 Basic Checks

  • In the past year HEP was profitable.
  • In the past year HEP had a positive cash flow from operations.
HEP Yearly Net Income VS EBIT VS OCF VS FCFHEP Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2016 2017 2018 2019 2020 2021 2022 100M 200M 300M

1.2 Ratios

  • With a Return On Assets value of 8.82%, HEP perfoms like the industry average, outperforming 54.38% of the companies in the same industry.
  • The Return On Equity of HEP (26.66%) is better than 65.90% of its industry peers.
  • HEP's Return On Invested Capital of 7.61% is on the low side compared to the rest of the industry. HEP is outperformed by 60.83% of its industry peers.
  • HEP had an Average Return On Invested Capital over the past 3 years of 7.99%. This is significantly below the industry average of 23.05%.
Industry RankSector Rank
ROA 8.82%
ROE 26.66%
ROIC 7.61%
ROA(3y)8.55%
ROA(5y)8.88%
ROE(3y)39.57%
ROE(5y)43.91%
ROIC(3y)7.99%
ROIC(5y)8.68%
HEP Yearly ROA, ROE, ROICHEP Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2016 2017 2018 2019 2020 2021 2022 10 20 30 40 50

1.3 Margins

  • Looking at the Profit Margin, with a value of 40.91%, HEP belongs to the top of the industry, outperforming 80.18% of the companies in the same industry.
  • In the last couple of years the Profit Margin of HEP has grown nicely.
  • With a decent Operating Margin value of 42.93%, HEP is doing good in the industry, outperforming 74.65% of the companies in the same industry.
  • In the last couple of years the Operating Margin of HEP has declined.
  • HEP's Gross Margin of 62.77% is fine compared to the rest of the industry. HEP outperforms 61.75% of its industry peers.
  • In the last couple of years the Gross Margin of HEP has declined.
Industry RankSector Rank
OM 42.93%
PM (TTM) 40.91%
GM 62.77%
OM growth 3Y-6.27%
OM growth 5Y-3.66%
PM growth 3Y-2.17%
PM growth 5Y2.34%
GM growth 3Y-4.02%
GM growth 5Y-2.47%
HEP Yearly Profit, Operating, Gross MarginsHEP Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2016 2017 2018 2019 2020 2021 2022 20 40 60

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3

2. HEP Health Analysis

2.1 Basic Checks

  • HEP has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
  • HEP has more shares outstanding than it did 1 year ago.
  • HEP has a better debt/assets ratio than last year.
HEP Yearly Shares OutstandingHEP Yearly Shares OutstandingYearly Shares Outstanding 2016 2017 2018 2019 2020 2021 2022 20M 40M 60M 80M 100M
HEP Yearly Total Debt VS Total AssetsHEP Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2016 2017 2018 2019 2020 2021 2022 500M 1B 1.5B 2B 2.5B

2.2 Solvency

  • The Debt to FCF ratio of HEP is 4.77, which is a neutral value as it means it would take HEP, 4.77 years of fcf income to pay off all of its debts.
  • The Debt to FCF ratio of HEP (4.77) is comparable to the rest of the industry.
  • HEP has a Debt/Equity ratio of 1.71. This is a high value indicating a heavy dependency on external financing.
  • Looking at the Debt to Equity ratio, with a value of 1.71, HEP is doing worse than 81.11% of the companies in the same industry.
Industry RankSector Rank
Debt/Equity 1.71
Debt/FCF 4.77
Altman-Z N/A
ROIC/WACC1.05
WACC7.28%
HEP Yearly LT Debt VS Equity VS FCFHEP Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2016 2017 2018 2019 2020 2021 2022 500M 1B 1.5B

2.3 Liquidity

  • A Current Ratio of 1.15 indicates that HEP should not have too much problems paying its short term obligations.
  • HEP has a Current ratio of 1.15. This is comparable to the rest of the industry: HEP outperforms 48.39% of its industry peers.
  • HEP has a Quick Ratio of 1.15. This is a normal value and indicates that HEP is financially healthy and should not expect problems in meeting its short term obligations.
  • Looking at the Quick ratio, with a value of 1.15, HEP is in line with its industry, outperforming 57.14% of the companies in the same industry.
Industry RankSector Rank
Current Ratio 1.15
Quick Ratio 1.15
HEP Yearly Current Assets VS Current LiabilitesHEP Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2016 2017 2018 2019 2020 2021 2022 20M 40M 60M 80M 100M

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WACCDebt/EquityHow to determine the health of a companyAltman-Z scoreShow peers with great health

5

3. HEP Growth Analysis

3.1 Past

  • HEP shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 13.86%, which is quite good.
  • HEP shows a decrease in Earnings Per Share. Measured over the last years, the EPS has been decreasing by -1.41% yearly.
  • HEP shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 11.56%.
  • HEP shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 3.80% yearly.
EPS 1Y (TTM)13.86%
EPS 3Y-0.56%
EPS 5Y-1.41%
EPS Q2Q%51.52%
Revenue 1Y (TTM)11.56%
Revenue growth 3Y0.91%
Revenue growth 5Y3.8%
Sales Q2Q%6.31%

3.2 Future

  • Based on estimates for the next years, HEP will show a quite strong growth in Earnings Per Share. The EPS will grow by 9.09% on average per year.
  • The Revenue is expected to grow by 5.53% on average over the next years.
EPS Next Y7.71%
EPS Next 2Y11.49%
EPS Next 3Y9.09%
EPS Next 5YN/A
Revenue Next Year9.05%
Revenue Next 2Y7.91%
Revenue Next 3Y5.53%
Revenue Next 5YN/A

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.
  • When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
HEP Yearly Revenue VS EstimatesHEP Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 200M 400M 600M
HEP Yearly EPS VS EstimatesHEP Yearly EPS VS EstimatesYearly EPS VS Estimates 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 0.5 1 1.5 2

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5

4. HEP Valuation Analysis

4.1 Price/Earnings Ratio

  • Based on the Price/Earnings ratio of 10.82, the valuation of HEP can be described as reasonable.
  • HEP's Price/Earnings is on the same level as the industry average.
  • When comparing the Price/Earnings ratio of HEP to the average of the S&P500 Index (25.23), we can say HEP is valued rather cheaply.
  • With a Price/Forward Earnings ratio of 9.29, the valuation of HEP can be described as very reasonable.
  • HEP's Price/Forward Earnings ratio is in line with the industry average.
  • Compared to an average S&P500 Price/Forward Earnings ratio of 22.42, HEP is valued rather cheaply.
Industry RankSector Rank
PE 10.82
Fwd PE 9.29
HEP Price Earnings VS Forward Price EarningsHEP Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 10 20 30

4.2 Price Multiples

  • Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of HEP indicates a slightly more expensive valuation: HEP is more expensive than 70.51% of the companies listed in the same industry.
  • 68.66% of the companies in the same industry are more expensive than HEP, based on the Price/Free Cash Flow ratio.
Industry RankSector Rank
P/FCF 8.05
EV/EBITDA 11.73
HEP Per share dataHEP EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 2 4 6

4.3 Compensation for Growth

  • HEP's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
PEG (NY)1.4
PEG (5Y)N/A
EPS Next 2Y11.49%
EPS Next 3Y9.09%

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Price/EarningsPrice/FCFFCF per shareEV/EBITDAPEG RATIOShow best valued peers

5

5. HEP Dividend Analysis

5.1 Amount

  • HEP has a Yearly Dividend Yield of 6.85%, which is a nice return.
  • HEP's Dividend Yield is a higher than the industry average which is at 3.29.
  • HEP's Dividend Yield is rather good when compared to the S&P500 average which is at 1.89.
Industry RankSector Rank
Dividend Yield 6.85%

5.2 History

  • The dividend of HEP decreases each year by -12.46%.
  • HEP has been paying a dividend for at least 10 years, so it has a reliable track record.
  • HEP has decreased its dividend recently.
Dividend Growth(5Y)-12.46%
Div Incr Years1
Div Non Decr Years1
HEP Yearly Dividends per shareHEP Yearly Dividends per shareYearly Dividends per share 2016 2017 2018 2019 2020 2021 2022 2023 0.5 1 1.5 2 2.5

5.3 Sustainability

  • 74.17% of the earnings are spent on dividend by HEP. This is not a sustainable payout ratio.
DP74.17%
EPS Next 2Y11.49%
EPS Next 3Y9.09%
HEP Yearly Income VS Free CF VS DividendHEP Yearly Income VS Free CF VS DividendYearly Income VS Free CF VS Dividend 2016 2017 2018 2019 2020 2021 2022 50M 100M 150M 200M 250M
HEP Dividend Payout.HEP Dividend Payout, showing the Payout Ratio.HEP Dividend Payout.PayoutRetained Earnings

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HEP Fundamentals: All Metrics, Ratios and Statistics

Holly Energy Partners LP

NYSE:HEP (11/30/2023, 8:04:00 PM)

After market: 20.55 +0.1 (+0.49%)

20.45

-0.16 (-0.78%)

Chartmill FA Rating
GICS SectorEnergy
GICS IndustryGroupEnergy
GICS IndustryOil, Gas & Consumable Fuels
Earnings (Last)11-02
Earnings (Next)02-22
Inst Owners0%
Inst Owner Change0%
Ins Owners1.48%
Ins Owner Change0%
Market Cap2.59B
Revenue(TTM)584.00M
Net Income(TTM)238.90M
Analysts46
Price Target21.93 (7.24%)
Short Float %N/A
Short RatioN/A
Dividend
Industry RankSector Rank
Dividend Yield 6.85%
Yearly Dividend1.47
Dividend Growth(5Y)-12.46%
DP74.17%
Div Incr Years1
Div Non Decr Years1
Ex-DateN/A
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-7.42%
Min EPS beat(2)-10.9%
Max EPS beat(2)-3.94%
EPS beat(4)2
Avg EPS beat(4)-1.66%
Min EPS beat(4)-10.9%
Max EPS beat(4)4.89%
EPS beat(8)3
Avg EPS beat(8)-5.14%
EPS beat(12)7
Avg EPS beat(12)1.36%
EPS beat(16)10
Avg EPS beat(16)10.6%
Revenue beat(2)1
Avg Revenue beat(2)-2.31%
Min Revenue beat(2)-5.17%
Max Revenue beat(2)0.55%
Revenue beat(4)2
Avg Revenue beat(4)1.39%
Min Revenue beat(4)-5.34%
Max Revenue beat(4)15.53%
Revenue beat(8)5
Avg Revenue beat(8)2.44%
Revenue beat(12)7
Avg Revenue beat(12)1.28%
Revenue beat(16)9
Avg Revenue beat(16)1.05%
PT rev (1m)0%
PT rev (3m)0%
EPS NQ rev (1m)0%
EPS NQ rev (3m)1.03%
EPS NY rev (1m)0%
EPS NY rev (3m)-2.75%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-0.18%
Valuation
Industry RankSector Rank
PE 10.82
Fwd PE 9.29
P/S 4.43
P/FCF 8.05
P/OCF 7.37
P/B 2.89
P/tB 5.16
EV/EBITDA 11.73
EPS(TTM)1.89
EY9.24%
EPS(NY)2.2
Fwd EY10.76%
FCF(TTM)2.54
FCFY12.42%
OCF(TTM)2.78
OCFY13.57%
SpS4.62
BVpS7.09
TBVpS3.97
PEG (NY)1.4
PEG (5Y)N/A
Graham NumberN/A
Profitability
Industry RankSector Rank
ROA 8.82%
ROE 26.66%
ROCE 9.64%
ROIC 7.61%
ROICexc 7.65%
ROICexgc 9.02%
OM 42.93%
PM (TTM) 40.91%
GM 62.77%
FCFM 55%
ROA(3y)8.55%
ROA(5y)8.88%
ROE(3y)39.57%
ROE(5y)43.91%
ROIC(3y)7.99%
ROIC(5y)8.68%
ROICexc(3y)8.05%
ROICexc(5y)8.73%
ROICexgc(3y)9.47%
ROICexgc(5y)10.46%
ROCE(3y)10.11%
ROCE(5y)10.99%
ROICexgc growth 3Y-13.07%
ROICexgc growth 5Y-5.5%
ROICexc growth 3Y-12.24%
ROICexc growth 5Y-4.64%
OM growth 3Y-6.27%
OM growth 5Y-3.66%
PM growth 3Y-2.17%
PM growth 5Y2.34%
GM growth 3Y-4.02%
GM growth 5Y-2.47%
F-Score8
Asset Turnover0.22
Health
Industry RankSector Rank
Debt/Equity 1.71
Debt/FCF 4.77
Debt/EBITDA 4.36
Cap/Depr 29.92%
Cap/Sales 5.1%
Interest Coverage 2.49
Cash Conversion 100.2%
Profit Quality 134.45%
Current Ratio 1.15
Quick Ratio 1.15
Altman-Z N/A
F-Score8
WACC7.28%
ROIC/WACC1.05
Cap/Depr(3y)64.95%
Cap/Depr(5y)54.8%
Cap/Sales(3y)12.41%
Cap/Sales(5y)10.45%
Profit Quality(3y)126.74%
Profit Quality(5y)127.52%
High Growth Momentum
Growth
EPS 1Y (TTM)13.86%
EPS 3Y-0.56%
EPS 5Y-1.41%
EPS Q2Q%51.52%
EPS Next Y7.71%
EPS Next 2Y11.49%
EPS Next 3Y9.09%
EPS Next 5YN/A
Revenue 1Y (TTM)11.56%
Revenue growth 3Y0.91%
Revenue growth 5Y3.8%
Sales Q2Q%6.31%
Revenue Next Year9.05%
Revenue Next 2Y7.91%
Revenue Next 3Y5.53%
Revenue Next 5YN/A
EBIT growth 1Y18.14%
EBIT growth 3Y-5.42%
EBIT growth 5Y0%
EBIT Next Year83.08%
EBIT Next 3Y24.67%
EBIT Next 5YN/A
FCF growth 1Y38.39%
FCF growth 3Y3.03%
FCF growth 5Y8.56%
OCF growth 1Y5.91%
OCF growth 3Y3.67%
OCF growth 5Y6.77%

Holly Energy Partners LP / HEP Fundamental Analysis FAQ

What is the fundamental rating for HEP stock?

ChartMill assigns a fundamental rating of 4 / 10 to HEP.


What is the valuation status of Holly Energy Partners LP (HEP) stock?

ChartMill assigns a valuation rating of 5 / 10 to Holly Energy Partners LP (HEP). This can be considered as Fairly Valued.


How profitable is Holly Energy Partners LP (HEP) stock?

Holly Energy Partners LP (HEP) has a profitability rating of 5 / 10.


What is the valuation of Holly Energy Partners LP based on its PE and PB ratios?

The Price/Earnings (PE) ratio for Holly Energy Partners LP (HEP) is 10.82 and the Price/Book (PB) ratio is 2.89.


What is the financial health of Holly Energy Partners LP (HEP) stock?

The financial health rating of Holly Energy Partners LP (HEP) is 3 / 10.