PEMBINA PIPELINE CORP (PPL.CA) Stock Fundamental Analysis
Canada - Toronto Stock Exchange - TSX:PPL - CA7063271034 - Common Stock
55.48 CAD
+0.71 (+1.3%)
We assign a fundamental rating of 5 out of 10 to PPL. PPL was compared to 214 industry peers in the Oil, Gas & Consumable Fuels industry. While PPL has a great profitability rating, there are quite some concerns on its financial health. PPL has a correct valuation and a medium growth rate. PPL also has an excellent dividend rating.
1. Profitability
1.1 Basic Checks
- PPL had positive earnings in the past year.
- PPL had a positive operating cash flow in the past year.
- Of the past 5 years PPL 4 years were profitable.
- Each year in the past 5 years PPL had a positive operating cash flow.
1.2 Ratios
- The Return On Assets of PPL (4.60%) is better than 79.44% of its industry peers.
- The Return On Equity of PPL (9.59%) is better than 78.04% of its industry peers.
- The Return On Invested Capital of PPL (7.22%) is better than 86.45% of its industry peers.
- PPL had an Average Return On Invested Capital over the past 3 years of 6.98%. This is in line with the industry average of 6.53%.
- The 3 year average ROIC (6.98%) for PPL is below the current ROIC(7.22%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.6% | ||
| ROE | 9.59% | ||
| ROIC | 7.22% |
ROA(3y)6.29%
ROA(5y)4.17%
ROE(3y)12.77%
ROE(5y)8.56%
ROIC(3y)6.98%
ROIC(5y)6.78%
1.3 Margins
- With an excellent Profit Margin value of 20.35%, PPL belongs to the best of the industry, outperforming 82.71% of the companies in the same industry.
- PPL's Profit Margin has improved in the last couple of years.
- Looking at the Operating Margin, with a value of 36.59%, PPL belongs to the top of the industry, outperforming 88.78% of the companies in the same industry.
- PPL's Operating Margin has improved in the last couple of years.
- The Gross Margin of PPL (42.32%) is better than 68.22% of its industry peers.
- PPL's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 36.59% | ||
| PM (TTM) | 20.35% | ||
| GM | 42.32% |
OM growth 3Y9.34%
OM growth 5Y5.89%
PM growth 3Y22.34%
PM growth 5Y4.14%
GM growth 3Y13.54%
GM growth 5Y5.86%
2. Health
2.1 Basic Checks
- The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so PPL is destroying value.
- PPL has less shares outstanding than it did 1 year ago.
- The number of shares outstanding for PPL has been increased compared to 5 years ago.
- PPL has a worse debt/assets ratio than last year.
2.2 Solvency
- PPL has an Altman-Z score of 1.40. This is a bad value and indicates that PPL is not financially healthy and even has some risk of bankruptcy.
- With a decent Altman-Z score value of 1.40, PPL is doing good in the industry, outperforming 63.55% of the companies in the same industry.
- The Debt to FCF ratio of PPL is 5.21, which is a neutral value as it means it would take PPL, 5.21 years of fcf income to pay off all of its debts.
- With a decent Debt to FCF ratio value of 5.21, PPL is doing good in the industry, outperforming 77.10% of the companies in the same industry.
- A Debt/Equity ratio of 0.71 indicates that PPL is somewhat dependend on debt financing.
- PPL's Debt to Equity ratio of 0.71 is in line compared to the rest of the industry. PPL outperforms 44.39% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.71 | ||
| Debt/FCF | 5.21 | ||
| Altman-Z | 1.4 |
ROIC/WACC0.98
WACC7.35%
2.3 Liquidity
- A Current Ratio of 0.53 indicates that PPL may have some problems paying its short term obligations.
- The Current ratio of PPL (0.53) is worse than 69.16% of its industry peers.
- PPL has a Quick Ratio of 0.53. This is a bad value and indicates that PPL is not financially healthy enough and could expect problems in meeting its short term obligations.
- PPL has a Quick ratio of 0.41. This is in the lower half of the industry: PPL underperforms 71.03% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.53 | ||
| Quick Ratio | 0.41 |
3. Growth
3.1 Past
- PPL shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -14.89%.
- PPL shows a decrease in Earnings Per Share. Measured over the last years, the EPS has been decreasing by -0.52% yearly.
- The Revenue has been growing slightly by 3.96% in the past year.
- PPL shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 0.42% yearly.
EPS 1Y (TTM)-14.89%
EPS 3Y14.66%
EPS 5Y-0.52%
EPS Q2Q%-28.33%
Revenue 1Y (TTM)3.96%
Revenue growth 3Y-5.05%
Revenue growth 5Y0.42%
Sales Q2Q%-2.87%
3.2 Future
- The Earnings Per Share is expected to grow by 5.95% on average over the next years.
- Based on estimates for the next years, PPL will show a small growth in Revenue. The Revenue will grow by 1.80% on average per year.
EPS Next Y-8.89%
EPS Next 2Y-3.01%
EPS Next 3Y0.74%
EPS Next 5Y5.95%
Revenue Next Year3.51%
Revenue Next 2Y3.69%
Revenue Next 3Y5%
Revenue Next 5Y1.8%
3.3 Evolution
- The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
- The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
- The Price/Earnings ratio is 19.81, which indicates a rather expensive current valuation of PPL.
- Compared to the rest of the industry, the Price/Earnings ratio of PPL indicates a somewhat cheap valuation: PPL is cheaper than 64.49% of the companies listed in the same industry.
- When comparing the Price/Earnings ratio of PPL to the average of the S&P500 Index (27.21), we can say PPL is valued slightly cheaper.
- With a Price/Forward Earnings ratio of 19.66, PPL is valued on the expensive side.
- The rest of the industry has a similar Price/Forward Earnings ratio as PPL.
- The average S&P500 Price/Forward Earnings ratio is at 24.26. PPL is around the same levels.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.81 | ||
| Fwd PE | 19.66 |
4.2 Price Multiples
- PPL's Enterprise Value to EBITDA ratio is in line with the industry average.
- Compared to the rest of the industry, the Price/Free Cash Flow ratio of PPL indicates a somewhat cheap valuation: PPL is cheaper than 77.10% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 12.64 | ||
| EV/EBITDA | 11.54 |
4.3 Compensation for Growth
- PPL has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y-3.01%
EPS Next 3Y0.74%
5. Dividend
5.1 Amount
- With a Yearly Dividend Yield of 5.31%, PPL is a good candidate for dividend investing.
- PPL's Dividend Yield is rather good when compared to the industry average which is at 2.82. PPL pays more dividend than 90.65% of the companies in the same industry.
- PPL's Dividend Yield is rather good when compared to the S&P500 average which is at 1.82.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 5.31% |
5.2 History
- The dividend of PPL has a limited annual growth rate of 2.11%.
- PPL has been paying a dividend for at least 10 years, so it has a reliable track record.
- PPL has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)2.11%
Div Incr Years3
Div Non Decr Years26
5.3 Sustainability
- 108.16% of the earnings are spent on dividend by PPL. This is not a sustainable payout ratio.
- PPL's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP108.16%
EPS Next 2Y-3.01%
EPS Next 3Y0.74%
PEMBINA PIPELINE CORP / PPL.CA FAQ
What is the ChartMill fundamental rating of PEMBINA PIPELINE CORP (PPL.CA) stock?
ChartMill assigns a fundamental rating of 5 / 10 to PPL.CA.
What is the valuation status of PEMBINA PIPELINE CORP (PPL.CA) stock?
ChartMill assigns a valuation rating of 4 / 10 to PEMBINA PIPELINE CORP (PPL.CA). This can be considered as Fairly Valued.
Can you provide the profitability details for PEMBINA PIPELINE CORP?
PEMBINA PIPELINE CORP (PPL.CA) has a profitability rating of 8 / 10.
What are the PE and PB ratios of PEMBINA PIPELINE CORP (PPL.CA) stock?
The Price/Earnings (PE) ratio for PEMBINA PIPELINE CORP (PPL.CA) is 19.81 and the Price/Book (PB) ratio is 1.9.
Can you provide the financial health for PPL stock?
The financial health rating of PEMBINA PIPELINE CORP (PPL.CA) is 3 / 10.