OTTER TAIL CORP (OTTR) Stock Fundamental Analysis
NASDAQ:OTTR - Nasdaq - US6896481032 - Common Stock - Currency: USD
We assign a fundamental rating of 6 out of 10 to OTTR. OTTR was compared to 47 industry peers in the Electric Utilities industry. OTTR scores excellent points on both the profitability and health parts. This is a solid base for a good stock. OTTR is valued correctly, but it does not seem to be growing.
1. Profitability
1.1 Basic Checks
OTTR had positive earnings in the past year.
OTTR had a positive operating cash flow in the past year.
Of the past 5 years OTTR 4 years were profitable.
Of the past 5 years OTTR 4 years had a positive operating cash flow.
1.2 Ratios
Looking at the Return On Assets, with a value of 8.54%, OTTR belongs to the top of the industry, outperforming 100.00% of the companies in the same industry.
With an excellent Return On Equity value of 18.65%, OTTR belongs to the best of the industry, outperforming 92.11% of the companies in the same industry.
With an excellent Return On Invested Capital value of 9.22%, OTTR belongs to the best of the industry, outperforming 97.37% of the companies in the same industry.
OTTR had an Average Return On Invested Capital over the past 3 years of 9.97%. This is significantly above the industry average of 4.62%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.54% | ||
| ROE | 18.65% | ||
| ROIC | 9.22% |
ROA(3y)8.43%
ROA(5y)6.56%
ROE(3y)20.53%
ROE(5y)16.74%
ROIC(3y)9.97%
ROIC(5y)8.09%
1.3 Margins
OTTR has a Profit Margin of 22.70%. This is amongst the best in the industry. OTTR outperforms 94.74% of its industry peers.
OTTR's Profit Margin has improved in the last couple of years.
With an excellent Operating Margin value of 28.58%, OTTR belongs to the best of the industry, outperforming 92.11% of the companies in the same industry.
In the last couple of years the Operating Margin of OTTR has grown nicely.
Looking at the Gross Margin, with a value of 62.09%, OTTR is in line with its industry, outperforming 44.74% of the companies in the same industry.
OTTR's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 28.58% | ||
| PM (TTM) | 22.7% | ||
| GM | 62.09% |
OM growth 3Y19.01%
OM growth 5Y14.68%
PM growth 3Y26.49%
PM growth 5Y19.41%
GM growth 3Y2.59%
GM growth 5Y2.37%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so OTTR is still creating some value.
There is no outstanding debt for OTTR. 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
OTTR has an Altman-Z score of 2.30. This is not the best score and indicates that OTTR is in the grey zone with still only limited risk for bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 2.30, OTTR belongs to the top of the industry, outperforming 92.11% of the companies in the same industry.
OTTR has a debt to FCF ratio of 11.03. This is a negative value and a sign of low solvency as OTTR would need 11.03 years to pay back of all of its debts.
OTTR has a better Debt to FCF ratio (11.03) than 84.21% of its industry peers.
A Debt/Equity ratio of 0.62 indicates that OTTR is somewhat dependend on debt financing.
The Debt to Equity ratio of OTTR (0.62) is better than 81.58% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.62 | ||
| Debt/FCF | 11.03 | ||
| Altman-Z | 2.3 |
ROIC/WACC1.17
WACC7.91%
2.3 Liquidity
A Current Ratio of 2.17 indicates that OTTR has no problem at all paying its short term obligations.
With an excellent Current ratio value of 2.17, OTTR belongs to the best of the industry, outperforming 89.47% of the companies in the same industry.
A Quick Ratio of 1.66 indicates that OTTR should not have too much problems paying its short term obligations.
Looking at the Quick ratio, with a value of 1.66, OTTR belongs to the top of the industry, outperforming 86.84% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.17 | ||
| Quick Ratio | 1.66 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 2.43% over the past year.
OTTR shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 26.89% yearly.
EPS 1Y (TTM)2.43%
EPS 3Y19.23%
EPS 5Y26.89%
EPS Q2Q%-5.11%
Revenue 1Y (TTM)N/A
Revenue growth 3YN/A
Revenue growth 5YN/A
Sales Q2Q%-3.56%
3.2 Future
OTTR is expected to show a very negative growth in Earnings Per Share. In the coming years, the EPS will decrease by -12.98% yearly.
The Revenue is expected to grow by 2.29% on average over the next years.
EPS Next Y-19.98%
EPS Next 2Y-16.97%
EPS Next 3Y-18.6%
EPS Next 5Y-12.98%
Revenue Next Year0.51%
Revenue Next 2Y0.66%
Revenue Next 3Y1.72%
Revenue Next 5Y2.29%
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.
4. Valuation
4.1 Price/Earnings Ratio
OTTR is valuated reasonably with a Price/Earnings ratio of 11.36.
OTTR's Price/Earnings ratio is a bit cheaper when compared to the industry. OTTR is cheaper than 71.05% of the companies in the same industry.
OTTR is valuated cheaply when we compare the Price/Earnings ratio to 29.63, which is the current average of the S&P500 Index.
The Price/Forward Earnings ratio is 14.19, which indicates a correct valuation of OTTR.
Based on the Price/Forward Earnings ratio, OTTR is valued a bit cheaper than the industry average as 71.05% of the companies are valued more expensively.
The average S&P500 Price/Forward Earnings ratio is at 22.68. OTTR is valued slightly cheaper when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 11.36 | ||
| Fwd PE | 14.19 |
4.2 Price Multiples
OTTR's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. OTTR is cheaper than 78.95% of the companies in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of OTTR indicates a somewhat cheap valuation: OTTR is cheaper than 68.42% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 37.15 | ||
| EV/EBITDA | 8.33 |
4.3 Compensation for Growth
The excellent profitability rating of OTTR may justify a higher PE ratio.
A cheap valuation may be justified as OTTR's earnings are expected to decrease with -18.60% in the coming years.
PEG (NY)N/A
PEG (5Y)0.42
EPS Next 2Y-16.97%
EPS Next 3Y-18.6%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 2.58%, OTTR has a reasonable but not impressive dividend return.
OTTR's Dividend Yield is slightly below the industry average, which is at 3.52.
OTTR's Dividend Yield is comparable with the S&P500 average which is at 2.27.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.58% |
5.2 History
The dividend of OTTR has a limited annual growth rate of 5.50%.
OTTR has paid a dividend for at least 10 years, which is a reliable track record.
OTTR has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)5.5%
Div Incr Years11
Div Non Decr Years34
5.3 Sustainability
25.27% of the earnings are spent on dividend by OTTR. This is a low number and sustainable payout ratio.
DP25.27%
EPS Next 2Y-16.97%
EPS Next 3Y-18.6%
81.43
-0.02 (-0.02%)
Chartmill FA Rating
GICS SectorUtilities
GICS IndustryGroupUtilities
GICS IndustryElectric Utilities
Earnings (Last)
Earnings (Next)
Inst Owners67.09%
Inst Owner Change-91.48%
Ins Owners0.99%
Ins Owner Change4.77%
Market Cap3.41B
Analysts47.5
Price Target82.62 (1.46%)
Short Float %10.95%
Short Ratio19.51
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.58% |
Yearly Dividend1.75
Dividend Growth(5Y)5.5%
DP25.27%
Div Incr Years11
Div Non Decr Years34
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)10.17%
Min EPS beat(2)0.57%
Max EPS beat(2)19.76%
EPS beat(4)4
Avg EPS beat(4)11.85%
Min EPS beat(4)0.57%
Max EPS beat(4)19.76%
EPS beat(8)8
Avg EPS beat(8)21.53%
EPS beat(12)12
Avg EPS beat(12)21.28%
EPS beat(16)15
Avg EPS beat(16)22.07%
Revenue beat(2)0
Avg Revenue beat(2)-10.43%
Min Revenue beat(2)-12.13%
Max Revenue beat(2)-8.73%
Revenue beat(4)0
Avg Revenue beat(4)-7.05%
Min Revenue beat(4)-12.13%
Max Revenue beat(4)-3.55%
Revenue beat(8)3
Avg Revenue beat(8)-2.75%
Revenue beat(12)7
Avg Revenue beat(12)1.18%
Revenue beat(16)9
Avg Revenue beat(16)2.43%
PT rev (1m)0%
PT rev (3m)0%
EPS NQ rev (1m)0.55%
EPS NQ rev (3m)0.55%
EPS NY rev (1m)-0.19%
EPS NY rev (3m)1.31%
Revenue NQ rev (1m)1.63%
Revenue NQ rev (3m)1.63%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-0.51%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 11.36 | ||
| Fwd PE | 14.19 | ||
| P/S | 2.54 | ||
| P/FCF | 37.15 | ||
| P/OCF | 8.33 | ||
| P/B | 2.09 | ||
| P/tB | 2.14 | ||
| EV/EBITDA | 8.33 |
EPS(TTM)7.17
EY8.81%
EPS(NY)5.74
Fwd EY7.05%
FCF(TTM)2.19
FCFY2.69%
OCF(TTM)9.77
OCFY12%
SpS32.08
BVpS39.05
TBVpS38
PEG (NY)N/A
PEG (5Y)0.42
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.54% | ||
| ROE | 18.65% | ||
| ROCE | 11.74% | ||
| ROIC | 9.22% | ||
| ROICexc | 10.07% | ||
| ROICexgc | 10.22% | ||
| OM | 28.58% | ||
| PM (TTM) | 22.7% | ||
| GM | 62.09% | ||
| FCFM | 6.83% |
ROA(3y)8.43%
ROA(5y)6.56%
ROE(3y)20.53%
ROE(5y)16.74%
ROIC(3y)9.97%
ROIC(5y)8.09%
ROICexc(3y)10.43%
ROICexc(5y)8.37%
ROICexgc(3y)10.62%
ROICexgc(5y)8.53%
ROCE(3y)12.7%
ROCE(5y)10.29%
ROICexcg growth 3Y26.57%
ROICexcg growth 5Y14.55%
ROICexc growth 3Y26.81%
ROICexc growth 5Y14.79%
OM growth 3Y19.01%
OM growth 5Y14.68%
PM growth 3Y26.49%
PM growth 5Y19.41%
GM growth 3Y2.59%
GM growth 5Y2.37%
F-Score5
Asset Turnover0.38
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.62 | ||
| Debt/FCF | 11.03 | ||
| Debt/EBITDA | 2.07 | ||
| Cap/Depr | 302.18% | ||
| Cap/Sales | 23.63% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 83.69% | ||
| Profit Quality | 30.1% | ||
| Current Ratio | 2.17 | ||
| Quick Ratio | 1.66 | ||
| Altman-Z | 2.3 |
F-Score5
WACC7.91%
ROIC/WACC1.17
Cap/Depr(3y)221.96%
Cap/Depr(5y)276.92%
Cap/Sales(3y)15.79%
Cap/Sales(5y)22.33%
Profit Quality(3y)50.09%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)2.43%
EPS 3Y19.23%
EPS 5Y26.89%
EPS Q2Q%-5.11%
EPS Next Y-19.98%
EPS Next 2Y-16.97%
EPS Next 3Y-18.6%
EPS Next 5Y-12.98%
Revenue 1Y (TTM)N/A
Revenue growth 3YN/A
Revenue growth 5YN/A
Sales Q2Q%-3.56%
Revenue Next Year0.51%
Revenue Next 2Y0.66%
Revenue Next 3Y1.72%
Revenue Next 5Y2.29%
EBIT growth 1Y5.71%
EBIT growth 3Y36.71%
EBIT growth 5Y23.91%
EBIT Next Year33.27%
EBIT Next 3YN/A
EBIT Next 5YN/A
FCF growth 1Y-50.89%
FCF growth 3YN/A
FCF growth 5Y25.3%
OCF growth 1Y12.18%
OCF growth 3Y24.05%
OCF growth 5Y23.05%