HESS MIDSTREAM LP - CLASS A (HESM) Stock Fundamental Analysis
NYSE:HESM - New York Stock Exchange, Inc. - US4281031058 - Common Stock - Currency: USD
Taking everything into account, HESM scores 5 out of 10 in our fundamental rating. HESM was compared to 210 industry peers in the Oil, Gas & Consumable Fuels industry. While HESM is still in line with the averages on profitability rating, there are concerns on its financial health. HESM is not valued too expensively and it also shows a decent growth rate.
1. Profitability
1.1 Basic Checks
In the past year HESM was profitable.
In the past year HESM had a positive cash flow from operations.
HESM had positive earnings in each of the past 5 years.
Of the past 5 years HESM 4 years had a positive operating cash flow.
1.2 Ratios
HESM has a Return On Assets (4.59%) which is in line with its industry peers.
Looking at the Return On Equity, with a value of 35.82%, HESM belongs to the top of the industry, outperforming 91.13% of the companies in the same industry.
The Return On Invested Capital of HESM (17.83%) is better than 89.66% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.59% | ||
| ROE | 35.82% | ||
| ROIC | 17.83% |
ROA(3y)N/A
ROA(5y)N/A
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)N/A
ROIC(5y)N/A
1.3 Margins
Looking at the Profit Margin, with a value of 13.06%, HESM is in line with its industry, outperforming 51.23% of the companies in the same industry.
In the last couple of years the Profit Margin of HESM has grown nicely.
Looking at the Operating Margin, with a value of 60.85%, HESM belongs to the top of the industry, outperforming 92.61% of the companies in the same industry.
HESM's Operating Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 60.85% | ||
| PM (TTM) | 13.06% | ||
| GM | N/A |
OM growth 3Y0.57%
OM growth 5Y6.72%
PM growth 3Y57.01%
PM growth 5Y13.67%
GM growth 3YN/A
GM growth 5YN/A
2. Health
2.1 Basic Checks
HESM has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
There is no outstanding debt for HESM. This means it has a Debt/Equity and Debt/FCF ratio of 0 and it is amongst the best of the sector and industry.
2.2 Solvency
HESM has a debt to FCF ratio of 5.33. This is a neutral value as HESM would need 5.33 years to pay back of all of its debts.
HESM's Debt to FCF ratio of 5.33 is in line compared to the rest of the industry. HESM outperforms 57.64% of its industry peers.
A Debt/Equity ratio of 6.53 is on the high side and indicates that HESM has dependencies on debt financing.
HESM has a Debt to Equity ratio of 6.53. This is amonst the worse of the industry: HESM underperforms 94.09% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 6.53 | ||
| Debt/FCF | 5.33 | ||
| Altman-Z | N/A |
ROIC/WACC2.15
WACC8.28%
2.3 Liquidity
A Current Ratio of 0.70 indicates that HESM may have some problems paying its short term obligations.
HESM has a worse Current ratio (0.70) than 78.33% of its industry peers.
HESM has a Quick Ratio of 0.70. This is a bad value and indicates that HESM is not financially healthy enough and could expect problems in meeting its short term obligations.
Looking at the Quick ratio, with a value of 0.70, HESM is doing worse than 70.94% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.7 | ||
| Quick Ratio | 0.7 |
3. Growth
3.1 Past
HESM shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 19.14%, which is quite good.
Measured over the past years, HESM shows a quite strong growth in Earnings Per Share. The EPS has been growing by 15.34% on average per year.
HESM shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 10.89%.
Measured over the past years, HESM shows a quite strong growth in Revenue. The Revenue has been growing by 12.01% on average per year.
EPS 1Y (TTM)19.14%
EPS 3Y12.26%
EPS 5Y15.34%
EPS Q2Q%23.64%
Revenue 1Y (TTM)10.89%
Revenue growth 3Y7.5%
Revenue growth 5Y12.01%
Sales Q2Q%11.05%
3.2 Future
HESM is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 8.79% yearly.
Based on estimates for the next years, HESM will show a quite strong growth in Revenue. The Revenue will grow by 9.39% on average per year.
EPS Next Y15.5%
EPS Next 2Y15.81%
EPS Next 3Y11.71%
EPS Next 5Y8.79%
Revenue Next Year11.05%
Revenue Next 2Y10.79%
Revenue Next 3Y9.39%
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 decreasing.
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
Based on the Price/Earnings ratio of 16.27, the valuation of HESM can be described as correct.
The rest of the industry has a similar Price/Earnings ratio as HESM.
HESM is valuated rather cheaply when we compare the Price/Earnings ratio to 29.53, which is the current average of the S&P500 Index.
A Price/Forward Earnings ratio of 14.09 indicates a correct valuation of HESM.
The rest of the industry has a similar Price/Forward Earnings ratio as HESM.
HESM's Price/Forward Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 22.65.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 16.27 | ||
| Fwd PE | 14.09 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, HESM is valued a bit more expensive than 60.10% of the companies in the same industry.
HESM's Price/Free Cash Flow is on the same level as the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 13.33 | ||
| EV/EBITDA | 11.24 |
4.3 Compensation for Growth
The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
HESM has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)1.05
PEG (5Y)1.06
EPS Next 2Y15.81%
EPS Next 3Y11.71%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 6.80%, HESM is a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 6.68, HESM pays a bit more dividend than its industry peers.
Compared to an average S&P500 Dividend Yield of 2.27, HESM pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 6.8% |
5.2 History
The dividend of HESM decreases each year by -16.62%.
HESM has been paying a dividend for over 5 years, so it has already some track record.
HESM has not decreased its dividend in the past 5 years, so it has a somewhat stable track record.
Dividend Growth(5Y)-16.62%
Div Incr Years7
Div Non Decr Years7
5.3 Sustainability
HESM pays out 108.41% of its income as dividend. This is not a sustainable payout ratio.
DP108.41%
EPS Next 2Y15.81%
EPS Next 3Y11.71%
40.52
-0.12 (-0.3%)
Chartmill FA Rating
GICS SectorEnergy
GICS IndustryGroupEnergy
GICS IndustryOil, Gas & Consumable Fuels
Earnings (Last)
Earnings (Next)
Inst Owners93.66%
Inst Owner Change-69.42%
Ins Owners0.26%
Ins Owner Change3.47%
Market Cap8.73B
Analysts80
Price Target44.88 (10.76%)
Short Float %6.64%
Short Ratio6.25
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 6.8% |
Yearly Dividend0.55
Dividend Growth(5Y)-16.62%
DP108.41%
Div Incr Years7
Div Non Decr Years7
Ex-Date
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-7.47%
Min EPS beat(2)-8.76%
Max EPS beat(2)-6.17%
EPS beat(4)0
Avg EPS beat(4)-9.28%
Min EPS beat(4)-13.88%
Max EPS beat(4)-6.17%
EPS beat(8)2
Avg EPS beat(8)-5.76%
EPS beat(12)2
Avg EPS beat(12)-6.24%
EPS beat(16)3
Avg EPS beat(16)-4.81%
Revenue beat(2)0
Avg Revenue beat(2)-1.72%
Min Revenue beat(2)-1.87%
Max Revenue beat(2)-1.57%
Revenue beat(4)0
Avg Revenue beat(4)-1.74%
Min Revenue beat(4)-2.61%
Max Revenue beat(4)-0.92%
Revenue beat(8)1
Avg Revenue beat(8)-1.45%
Revenue beat(12)3
Avg Revenue beat(12)-0.71%
Revenue beat(16)4
Avg Revenue beat(16)-0.97%
PT rev (1m)6.67%
PT rev (3m)8.64%
EPS NQ rev (1m)-0.26%
EPS NQ rev (3m)-0.26%
EPS NY rev (1m)-10.6%
EPS NY rev (3m)0.1%
Revenue NQ rev (1m)0.29%
Revenue NQ rev (3m)0.29%
Revenue NY rev (1m)-0.06%
Revenue NY rev (3m)-0.06%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 16.27 | ||
| Fwd PE | 14.09 | ||
| P/S | 6 | ||
| P/FCF | 13.33 | ||
| P/OCF | 9.39 | ||
| P/B | 16.44 | ||
| P/tB | 16.44 | ||
| EV/EBITDA | 11.24 |
EPS(TTM)2.49
EY6.15%
EPS(NY)2.88
Fwd EY7.1%
FCF(TTM)3.04
FCFY7.5%
OCF(TTM)4.31
OCFY10.65%
SpS6.76
BVpS2.46
TBVpS2.46
PEG (NY)1.05
PEG (5Y)1.06
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.59% | ||
| ROE | 35.82% | ||
| ROCE | 22.57% | ||
| ROIC | 17.83% | ||
| ROICexc | 17.88% | ||
| ROICexgc | 17.88% | ||
| OM | 60.85% | ||
| PM (TTM) | 13.06% | ||
| GM | N/A | ||
| FCFM | 44.98% |
ROA(3y)N/A
ROA(5y)N/A
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)N/A
ROIC(5y)N/A
ROICexc(3y)N/A
ROICexc(5y)N/A
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)N/A
ROCE(5y)N/A
ROICexcg growth 3YN/A
ROICexcg growth 5YN/A
ROICexc growth 3YN/A
ROICexc growth 5YN/A
OM growth 3Y0.57%
OM growth 5Y6.72%
PM growth 3Y57.01%
PM growth 5Y13.67%
GM growth 3YN/A
GM growth 5YN/A
F-Score9
Asset Turnover0.35
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 6.53 | ||
| Debt/FCF | 5.33 | ||
| Debt/EBITDA | 3.19 | ||
| Cap/Depr | 135.76% | ||
| Cap/Sales | 18.85% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 85.4% | ||
| Profit Quality | 344.32% | ||
| Current Ratio | 0.7 | ||
| Quick Ratio | 0.7 | ||
| Altman-Z | N/A |
F-Score9
WACC8.28%
ROIC/WACC2.15
Cap/Depr(3y)N/A
Cap/Depr(5y)N/A
Cap/Sales(3y)N/A
Cap/Sales(5y)N/A
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)19.14%
EPS 3Y12.26%
EPS 5Y15.34%
EPS Q2Q%23.64%
EPS Next Y15.5%
EPS Next 2Y15.81%
EPS Next 3Y11.71%
EPS Next 5Y8.79%
Revenue 1Y (TTM)10.89%
Revenue growth 3Y7.5%
Revenue growth 5Y12.01%
Sales Q2Q%11.05%
Revenue Next Year11.05%
Revenue Next 2Y10.79%
Revenue Next 3Y9.39%
Revenue Next 5YN/A
EBIT growth 1Y10.32%
EBIT growth 3Y8.12%
EBIT growth 5Y19.53%
EBIT Next Year37.61%
EBIT Next 3Y16.59%
EBIT Next 5Y10.56%
FCF growth 1Y5.66%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y10.46%
OCF growth 3YN/A
OCF growth 5YN/A