NORTHWEST NATURAL HOLDING CO (NWN) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:NWN - US66765N1054 - Common Stock
46.61 USD
-0.29 (-0.62%)
Taking everything into account, NWN scores 4 out of 10 in our fundamental rating. NWN was compared to 14 industry peers in the Gas Utilities industry. There are concerns on the financial health of NWN while its profitability can be described as average. NWN is not valued too expensively and it also shows a decent growth rate. Finally NWN also has an excellent dividend rating.
1. Profitability
1.1 Basic Checks
- In the past year NWN was profitable.
- In the past year NWN had a positive cash flow from operations.
- Each year in the past 5 years NWN has been profitable.
- In the past 5 years NWN always reported a positive cash flow from operatings.
1.2 Ratios
- Looking at the Return On Assets, with a value of 1.72%, NWN is doing worse than 85.71% of the companies in the same industry.
- NWN has a worse Return On Equity (7.01%) than 78.57% of its industry peers.
- Looking at the Return On Invested Capital, with a value of 3.50%, NWN is doing worse than 85.71% of the companies in the same industry.
- Measured over the past 3 years, the Average Return On Invested Capital for NWN is below the industry average of 6.27%.
- The 3 year average ROIC (3.03%) for NWN is below the current ROIC(3.50%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.72% | ||
| ROE | 7.01% | ||
| ROIC | 3.5% |
ROA(3y)1.75%
ROA(5y)1.85%
ROE(3y)6.78%
ROE(5y)7.48%
ROIC(3y)3.03%
ROIC(5y)3.09%
1.3 Margins
- NWN has a worse Profit Margin (7.94%) than 71.43% of its industry peers.
- In the last couple of years the Profit Margin of NWN has declined.
- With a Operating Margin value of 20.07%, NWN perfoms like the industry average, outperforming 57.14% of the companies in the same industry.
- In the last couple of years the Operating Margin of NWN has remained more or less at the same level.
- NWN has a Gross Margin of 64.40%. This is in the better half of the industry: NWN outperforms 64.29% of its industry peers.
- NWN's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 20.07% | ||
| PM (TTM) | 7.94% | ||
| GM | 64.4% |
OM growth 3Y-4.37%
OM growth 5Y-0.3%
PM growth 3Y-9.23%
PM growth 5Y-3.72%
GM growth 3Y-1.06%
GM growth 5Y0.22%
2. Health
2.1 Basic Checks
- With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), NWN is destroying value.
- The number of shares outstanding for NWN has been increased compared to 1 year ago.
- NWN has more shares outstanding than it did 5 years ago.
- Compared to 1 year ago, NWN has a worse debt to assets ratio.
2.2 Solvency
- NWN has an Altman-Z score of 0.66. This is a bad value and indicates that NWN is not financially healthy and even has some risk of bankruptcy.
- NWN's Altman-Z score of 0.66 is on the low side compared to the rest of the industry. NWN is outperformed by 71.43% of its industry peers.
- A Debt/Equity ratio of 1.62 is on the high side and indicates that NWN has dependencies on debt financing.
- NWN has a Debt to Equity ratio of 1.62. This is in the lower half of the industry: NWN underperforms 78.57% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.62 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 0.66 |
ROIC/WACC0.58
WACC6.04%
2.3 Liquidity
- NWN has a Current Ratio of 0.59. This is a bad value and indicates that NWN is not financially healthy enough and could expect problems in meeting its short term obligations.
- NWN has a Current ratio (0.59) which is in line with its industry peers.
- A Quick Ratio of 0.43 indicates that NWN may have some problems paying its short term obligations.
- NWN's Quick ratio of 0.43 is in line compared to the rest of the industry. NWN outperforms 50.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.59 | ||
| Quick Ratio | 0.43 |
3. Growth
3.1 Past
- The Earnings Per Share has grown by an impressive 35.38% over the past year.
- Measured over the past years, NWN shows a decrease in Earnings Per Share. The EPS has been decreasing by -0.09% on average per year.
- The Revenue has grown by 11.27% in the past year. This is quite good.
- NWN shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 9.09% yearly.
EPS 1Y (TTM)35.38%
EPS 3Y-3.23%
EPS 5Y-0.09%
EPS Q2Q%-2.82%
Revenue 1Y (TTM)11.27%
Revenue growth 3Y10.25%
Revenue growth 5Y9.09%
Sales Q2Q%20.3%
3.2 Future
- NWN is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 9.04% yearly.
- NWN is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 6.47% yearly.
EPS Next Y26.54%
EPS Next 2Y14.38%
EPS Next 3Y12.26%
EPS Next 5Y9.04%
Revenue Next Year10.85%
Revenue Next 2Y8.68%
Revenue Next 3Y7.13%
Revenue Next 5Y6.47%
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.
- 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
- NWN is valuated correctly with a Price/Earnings ratio of 16.24.
- Compared to the rest of the industry, the Price/Earnings ratio of NWN indicates a somewhat cheap valuation: NWN is cheaper than 64.29% of the companies listed in the same industry.
- NWN's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 28.82.
- Based on the Price/Forward Earnings ratio of 15.36, the valuation of NWN can be described as correct.
- Compared to the rest of the industry, the Price/Forward Earnings ratio of NWN indicates a somewhat cheap valuation: NWN is cheaper than 71.43% of the companies listed in the same industry.
- The average S&P500 Price/Forward Earnings ratio is at 25.95. NWN is valued slightly cheaper when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 16.24 | ||
| Fwd PE | 15.36 |
4.2 Price Multiples
- Based on the Enterprise Value to EBITDA ratio, NWN is valued a bit cheaper than 64.29% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 9.51 |
4.3 Compensation for Growth
- The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
- A more expensive valuation may be justified as NWN's earnings are expected to grow with 12.26% in the coming years.
PEG (NY)0.61
PEG (5Y)N/A
EPS Next 2Y14.38%
EPS Next 3Y12.26%
5. Dividend
5.1 Amount
- NWN has a Yearly Dividend Yield of 4.21%, which is a nice return.
- NWN's Dividend Yield is a higher than the industry average which is at 3.96.
- Compared to an average S&P500 Dividend Yield of 1.82, NWN pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.21% |
5.2 History
- The dividend of NWN has a limited annual growth rate of 0.84%.
- NWN has been paying a dividend for at least 10 years, so it has a reliable track record.
- NWN has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)0.84%
Div Incr Years24
Div Non Decr Years24
5.3 Sustainability
- NWN pays out 76.25% of its income as dividend. This is not a sustainable payout ratio.
- NWN's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP76.25%
EPS Next 2Y14.38%
EPS Next 3Y12.26%
NORTHWEST NATURAL HOLDING CO / NWN FAQ
What is the fundamental rating for NWN stock?
ChartMill assigns a fundamental rating of 4 / 10 to NWN.
What is the valuation status of NORTHWEST NATURAL HOLDING CO (NWN) stock?
ChartMill assigns a valuation rating of 5 / 10 to NORTHWEST NATURAL HOLDING CO (NWN). This can be considered as Fairly Valued.
What is the profitability of NWN stock?
NORTHWEST NATURAL HOLDING CO (NWN) has a profitability rating of 4 / 10.
What is the valuation of NORTHWEST NATURAL HOLDING CO based on its PE and PB ratios?
The Price/Earnings (PE) ratio for NORTHWEST NATURAL HOLDING CO (NWN) is 16.24 and the Price/Book (PB) ratio is 1.35.
Is the dividend of NORTHWEST NATURAL HOLDING CO sustainable?
The dividend rating of NORTHWEST NATURAL HOLDING CO (NWN) is 8 / 10 and the dividend payout ratio is 76.25%.