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

  • HEP has a Return On Assets (8.82%) which is comparable to the rest of the industry.
  • HEP has a Return On Equity of 26.66%. This is in the better half of the industry: HEP outperforms 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.
  • Measured over the past 3 years, the Average Return On Invested Capital for HEP is significantly below the industry average of 23.14%.
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

  • The Profit Margin of HEP (40.91%) is better than 80.18% of its industry peers.
  • HEP's Profit Margin has improved in the last couple of years.
  • HEP has a better Operating Margin (42.93%) than 74.65% of its industry peers.
  • HEP's Operating Margin has declined in the last couple of years.
  • HEP has a Gross Margin of 62.77%. This is in the better half 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

  • The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so HEP is still creating some value.
  • The number of shares outstanding for HEP has been increased compared to 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.
  • HEP's Debt to Equity ratio of 1.71 is on the low side compared to the rest of the industry. HEP is outperformed by 81.11% of its industry peers.
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

  • HEP has a Current 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.
  • HEP has a Current ratio (1.15) which is comparable to the rest of the industry.
  • 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.
  • HEP has a Quick ratio (1.15) which is comparable to the rest of the 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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5

3. HEP Growth Analysis

3.1 Past

  • The Earnings Per Share has grown by an nice 13.86% over the past year.
  • HEP shows a decrease in Earnings Per Share. Measured over the last years, the EPS has been decreasing by -1.41% yearly.
  • Looking at the last year, HEP shows a quite strong growth in Revenue. The Revenue has grown by 11.56% in the last year.
  • 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

  • HEP is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 9.09% yearly.
  • Based on estimates for the next years, HEP will show a small growth in Revenue. The Revenue will grow by 5.53% on average per year.
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

  • HEP is valuated reasonably with a Price/Earnings ratio of 10.82.
  • HEP's Price/Earnings ratio is in line with the industry average.
  • HEP is valuated cheaply when we compare the Price/Earnings ratio to 25.35, which is the current average of the S&P500 Index.
  • The Price/Forward Earnings ratio is 9.29, which indicates a very decent valuation of HEP.
  • HEP's Price/Forward Earnings is on the same level as the industry average.
  • HEP's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 22.61.
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

  • HEP's Enterprise Value to EBITDA ratio is a bit more expensive when compared to the industry. HEP is more expensive than 70.51% of the companies in the same industry.
  • Based on the Price/Free Cash Flow ratio, HEP is valued a bit cheaper than 68.66% of the companies in the same industry.
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.
  • Compared to an average industry Dividend Yield of 3.20, HEP pays a bit more dividend than its industry peers.
  • Compared to an average S&P500 Dividend Yield of 1.89, HEP pays a better dividend.
Industry RankSector Rank
Dividend Yield 6.85%

5.2 History

  • The dividend of HEP decreases each year by -12.46%.
  • HEP has paid a dividend for at least 10 years, which is 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

  • HEP pays out 74.17% of its income as dividend. 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.


What is the profitability of HEP stock?

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


What is the expected EPS growth for Holly Energy Partners LP (HEP) stock?

The Earnings per Share (EPS) of Holly Energy Partners LP (HEP) is expected to grow by 7.71% in the next year.


How sustainable is the dividend of Holly Energy Partners LP (HEP) stock?

The dividend rating of Holly Energy Partners LP (HEP) is 5 / 10 and the dividend payout ratio is 74.17%.