MAGELLAN MIDSTREAM PARTNERS (MMP) Stock Fundamental Analysis
NYSE:MMP - New York Stock Exchange, Inc. - US5590801065 - Currency: USD
We assign a fundamental rating of 4 out of 10 to MMP. MMP was compared to 211 industry peers in the Oil, Gas & Consumable Fuels industry. While MMP is still in line with the averages on profitability rating, there are concerns on its financial health. MMP is quite expensive at the moment. It does show a decent growth rate. MMP also has an excellent dividend rating.
1. Profitability
1.1 Basic Checks
MMP had positive earnings in the past year.
In the past year MMP had a positive cash flow from operations.
MMP had positive earnings in each of the past 5 years.
In the past 5 years MMP always reported a positive cash flow from operatings.
1.2 Ratios
The Return On Assets of MMP (13.50%) is better than 61.75% of its industry peers.
MMP has a Return On Equity of 60.05%. This is amongst the best in the industry. MMP outperforms 88.48% of its industry peers.
The Return On Invested Capital of MMP (13.04%) is comparable to the rest of the industry.
The Average Return On Invested Capital over the past 3 years for MMP is significantly below the industry average of 28.75%.
The 3 year average ROIC (10.07%) for MMP is below the current ROIC(13.04%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 13.5% | ||
| ROE | 60.05% | ||
| ROIC | 13.04% |
ROA(3y)11.88%
ROA(5y)12.99%
ROE(3y)49.55%
ROE(5y)47.34%
ROIC(3y)10.07%
ROIC(5y)10.4%
1.3 Margins
With a decent Profit Margin value of 29.55%, MMP is doing good in the industry, outperforming 64.06% of the companies in the same industry.
MMP's Profit Margin has been stable in the last couple of years.
With a Operating Margin value of 32.92%, MMP perfoms like the industry average, outperforming 52.07% of the companies in the same industry.
MMP's Operating Margin has declined in the last couple of years.
With a Gross Margin value of 48.28%, MMP perfoms like the industry average, outperforming 46.54% of the companies in the same industry.
In the last couple of years the Gross Margin of MMP has declined.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 32.92% | ||
| PM (TTM) | 29.55% | ||
| GM | 48.28% |
OM growth 3Y-7.86%
OM growth 5Y-4.63%
PM growth 3Y-4.7%
PM growth 5Y-1.36%
GM growth 3Y-4.92%
GM growth 5Y-2.39%
2. Health
2.1 Basic Checks
MMP has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
MMP has less shares outstanding than it did 1 year ago.
Compared to 1 year ago, MMP has a worse debt to assets ratio.
2.2 Solvency
MMP has a debt to FCF ratio of 3.79. This is a good value and a sign of high solvency as MMP would need 3.79 years to pay back of all of its debts.
Looking at the Debt to FCF ratio, with a value of 3.79, MMP is in line with its industry, outperforming 56.68% of the companies in the same industry.
A Debt/Equity ratio of 2.91 is on the high side and indicates that MMP has dependencies on debt financing.
With a Debt to Equity ratio value of 2.91, MMP is not doing good in the industry: 84.79% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.91 | ||
| Debt/FCF | 3.79 | ||
| Altman-Z | N/A |
ROIC/WACC1.54
WACC8.46%
2.3 Liquidity
MMP has a Current Ratio of 1.08. This is a normal value and indicates that MMP is financially healthy and should not expect problems in meeting its short term obligations.
MMP has a Current ratio (1.08) which is comparable to the rest of the industry.
MMP has a Quick Ratio of 1.08. This is a bad value and indicates that MMP is not financially healthy enough and could expect problems in meeting its short term obligations.
MMP has a worse Quick ratio (0.60) than 76.96% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.08 | ||
| Quick Ratio | 0.6 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 7.49% over the past year.
MMP shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 5.82% yearly.
Looking at the last year, MMP shows a quite strong growth in Revenue. The Revenue has grown by 19.66% in the last year.
Measured over the past years, MMP shows a small growth in Revenue. The Revenue has been growing by 5.00% on average per year.
EPS 1Y (TTM)7.49%
EPS 3Y3.54%
EPS 5Y5.82%
EPS Q2Q%-29.34%
Revenue 1Y (TTM)19.66%
Revenue growth 3Y5.47%
Revenue growth 5Y5%
Sales Q2Q%11.24%
3.2 Future
The Earnings Per Share is expected to grow by 4.58% on average over the next years.
MMP is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 4.20% yearly.
EPS Next Y4.81%
EPS Next 2Y3.83%
EPS Next 3Y3.33%
EPS Next 5Y4.58%
Revenue Next Year12.86%
Revenue Next 2Y7.1%
Revenue Next 3Y5.56%
Revenue Next 5Y4.2%
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.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 13.75, the valuation of MMP can be described as correct.
64.52% of the companies in the same industry are cheaper than MMP, based on the Price/Earnings ratio.
The average S&P500 Price/Earnings ratio is at 29.63. MMP is valued rather cheaply when compared to this.
A Price/Forward Earnings ratio of 12.93 indicates a correct valuation of MMP.
Compared to the rest of the industry, the Price/Forward Earnings ratio of MMP is on the same level as its industry peers.
MMP is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 22.68, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.75 | ||
| Fwd PE | 12.93 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, MMP is valued a bit more expensive than 73.73% of the companies in the same industry.
MMP's Price/Free Cash Flow is on the same level as the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 10.6 | ||
| EV/EBITDA | 13.08 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates MMP does not grow enough to justify the current Price/Earnings ratio.
The decent profitability rating of MMP may justify a higher PE ratio.
PEG (NY)2.86
PEG (5Y)2.36
EPS Next 2Y3.83%
EPS Next 3Y3.33%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 6.07%, MMP is a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 6.67, MMP pays a bit more dividend than its industry peers.
Compared to an average S&P500 Dividend Yield of 2.27, MMP pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 6.07% |
5.2 History
The dividend of MMP has a limited annual growth rate of 3.51%.
MMP has been paying a dividend for at least 10 years, so it has a reliable track record.
MMP has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)3.51%
Div Incr Years16
Div Non Decr Years16
5.3 Sustainability
MMP pays out 83.00% of its income as dividend. This is not a sustainable payout ratio.
MMP's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP83%
EPS Next 2Y3.83%
EPS Next 3Y3.33%
69
+0.46 (+0.67%)
Chartmill FA Rating
GICS SectorEnergy
GICS IndustryGroupEnergy
GICS IndustryOil, Gas & Consumable Fuels
Earnings (Last)
Earnings (Next)
Inst Owners0.02%
Inst Owner Change-50%
Ins Owners0.42%
Ins Owner Change0%
Market Cap13.94B
Analysts65
Price Target65.85 (-4.57%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 6.07% |
Yearly Dividend4.19
Dividend Growth(5Y)3.51%
DP83%
Div Incr Years16
Div Non Decr Years16
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)8.41%
Min EPS beat(2)5.32%
Max EPS beat(2)11.5%
EPS beat(4)3
Avg EPS beat(4)5.84%
Min EPS beat(4)-30.04%
Max EPS beat(4)36.57%
EPS beat(8)N/A
Avg EPS beat(8)N/A
EPS beat(12)N/A
Avg EPS beat(12)N/A
EPS beat(16)N/A
Avg EPS beat(16)N/A
Revenue beat(2)2
Avg Revenue beat(2)10.3%
Min Revenue beat(2)1.59%
Max Revenue beat(2)19.01%
Revenue beat(4)4
Avg Revenue beat(4)9.1%
Min Revenue beat(4)1.59%
Max Revenue beat(4)19.01%
Revenue beat(8)N/A
Avg Revenue beat(8)N/A
Revenue beat(12)N/A
Avg Revenue beat(12)N/A
Revenue beat(16)N/A
Avg Revenue beat(16)N/A
PT rev (1m)0.16%
PT rev (3m)2.39%
EPS NQ rev (1m)1.08%
EPS NQ rev (3m)-0.61%
EPS NY rev (1m)1.98%
EPS NY rev (3m)6.81%
Revenue NQ rev (1m)3.22%
Revenue NQ rev (3m)1.21%
Revenue NY rev (1m)4.04%
Revenue NY rev (3m)10.85%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.75 | ||
| Fwd PE | 12.93 | ||
| P/S | 4 | ||
| P/FCF | 10.6 | ||
| P/OCF | 9.3 | ||
| P/B | 8.13 | ||
| P/tB | 8.58 | ||
| EV/EBITDA | 13.08 |
EPS(TTM)5.02
EY7.28%
EPS(NY)5.34
Fwd EY7.73%
FCF(TTM)6.51
FCFY9.43%
OCF(TTM)7.42
OCFY10.76%
SpS17.24
BVpS8.48
TBVpS8.04
PEG (NY)2.86
PEG (5Y)2.36
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 13.5% | ||
| ROE | 60.05% | ||
| ROCE | 16.51% | ||
| ROIC | 13.04% | ||
| ROICexc | 13.29% | ||
| ROICexgc | 13.46% | ||
| OM | 32.92% | ||
| PM (TTM) | 29.55% | ||
| GM | 48.28% | ||
| FCFM | 37.76% |
ROA(3y)11.88%
ROA(5y)12.99%
ROE(3y)49.55%
ROE(5y)47.34%
ROIC(3y)10.07%
ROIC(5y)10.4%
ROICexc(3y)10.08%
ROICexc(5y)10.49%
ROICexgc(3y)10.21%
ROICexgc(5y)10.63%
ROCE(3y)12.75%
ROCE(5y)13.16%
ROICexcg growth 3Y0.46%
ROICexcg growth 5Y-1.67%
ROICexc growth 3Y0.46%
ROICexc growth 5Y-1.6%
OM growth 3Y-7.86%
OM growth 5Y-4.63%
PM growth 3Y-4.7%
PM growth 5Y-1.36%
GM growth 3Y-4.92%
GM growth 5Y-2.39%
F-Score8
Asset Turnover0.46
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.91 | ||
| Debt/FCF | 3.79 | ||
| Debt/EBITDA | 3.47 | ||
| Cap/Depr | 63.64% | ||
| Cap/Sales | 5.3% | ||
| Interest Coverage | N/A | ||
| Cash Conversion | N/A | ||
| Profit Quality | 127.77% | ||
| Current Ratio | 1.08 | ||
| Quick Ratio | 0.6 | ||
| Altman-Z | N/A |
F-Score8
WACC8.46%
ROIC/WACC1.54
Cap/Depr(3y)98.33%
Cap/Depr(5y)177.38%
Cap/Sales(3y)9.67%
Cap/Sales(5y)16.63%
Profit Quality(3y)93.88%
Profit Quality(5y)75.72%
High Growth Momentum
Growth
EPS 1Y (TTM)7.49%
EPS 3Y3.54%
EPS 5Y5.82%
EPS Q2Q%-29.34%
EPS Next Y4.81%
EPS Next 2Y3.83%
EPS Next 3Y3.33%
EPS Next 5Y4.58%
Revenue 1Y (TTM)19.66%
Revenue growth 3Y5.47%
Revenue growth 5Y5%
Sales Q2Q%11.24%
Revenue Next Year12.86%
Revenue Next 2Y7.1%
Revenue Next 3Y5.56%
Revenue Next 5Y4.2%
EBIT growth 1Y28.59%
EBIT growth 3Y-2.82%
EBIT growth 5Y0.13%
EBIT Next Year37.09%
EBIT Next 3Y12.31%
EBIT Next 5Y8.33%
FCF growth 1Y42.63%
FCF growth 3Y36.82%
FCF growth 5Y11.03%
OCF growth 1Y31.92%
OCF growth 3Y-4.76%
OCF growth 5Y0.18%