TC ENERGY CORP (TRP.CA) Stock Fundamental Analysis
TSX:TRP - Toronto Stock Exchange - CA87807B1076 - Common Stock - Currency: CAD
Taking everything into account, TRP scores 4 out of 10 in our fundamental rating. TRP was compared to 219 industry peers in the Oil, Gas & Consumable Fuels industry. TRP has an excellent profitability rating, but there are concerns on its financial health. TRP has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
TRP had positive earnings in the past year.
In the past year TRP had a positive cash flow from operations.
TRP had positive earnings in each of the past 5 years.
TRP had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
With a decent Return On Assets value of 3.89%, TRP is doing good in the industry, outperforming 68.78% of the companies in the same industry.
The Return On Equity of TRP (16.65%) is better than 89.59% of its industry peers.
Looking at the Return On Invested Capital, with a value of 4.25%, TRP is in the better half of the industry, outperforming 64.25% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for TRP is below the industry average of 7.60%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.89% | ||
| ROE | 16.65% | ||
| ROIC | 4.25% |
ROA(3y)2.24%
ROA(5y)2.58%
ROE(3y)9.37%
ROE(5y)9.55%
ROIC(3y)4.35%
ROIC(5y)4.58%
1.3 Margins
The Profit Margin of TRP (33.36%) is better than 92.31% of its industry peers.
TRP's Profit Margin has improved in the last couple of years.
The Operating Margin of TRP (42.02%) is better than 91.40% of its industry peers.
TRP's Operating Margin has been stable in the last couple of years.
TRP has a better Gross Margin (67.95%) than 80.09% of its industry peers.
TRP's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 42.02% | ||
| PM (TTM) | 33.36% | ||
| GM | 67.95% |
OM growth 3Y-1.61%
OM growth 5Y-0.76%
PM growth 3Y35%
PM growth 5Y2.15%
GM growth 3Y-0.69%
GM growth 5Y-0.74%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), TRP is destroying value.
The number of shares outstanding for TRP remains at a similar level compared to 1 year ago.
Compared to 5 years ago, TRP has more shares outstanding
The debt/assets ratio for TRP has been reduced compared to a year ago.
2.2 Solvency
Based on the Altman-Z score of 0.62, we must say that TRP is in the distress zone and has some risk of bankruptcy.
TRP has a Altman-Z score (0.62) which is in line with its industry peers.
The Debt to FCF ratio of TRP is 44.37, which is on the high side as it means it would take TRP, 44.37 years of fcf income to pay off all of its debts.
The Debt to FCF ratio of TRP (44.37) is comparable to the rest of the industry.
A Debt/Equity ratio of 2.04 is on the high side and indicates that TRP has dependencies on debt financing.
Looking at the Debt to Equity ratio, with a value of 2.04, TRP is doing worse than 80.09% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.04 | ||
| Debt/FCF | 44.37 | ||
| Altman-Z | 0.62 |
ROIC/WACC0.58
WACC7.28%
2.3 Liquidity
TRP has a Current Ratio of 0.55. This is a bad value and indicates that TRP is not financially healthy enough and could expect problems in meeting its short term obligations.
TRP has a worse Current ratio (0.55) than 67.42% of its industry peers.
TRP has a Quick Ratio of 0.55. This is a bad value and indicates that TRP is not financially healthy enough and could expect problems in meeting its short term obligations.
The Quick ratio of TRP (0.47) is worse than 69.68% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.55 | ||
| Quick Ratio | 0.47 |
3. Growth
3.1 Past
TRP shows a slight negative growth in Earnings Per Share. In the last year, the EPS has decreased by -5.45%.
Measured over the past 5 years, TRP shows a small growth in Earnings Per Share. The EPS has been growing by 0.64% on average per year.
The Revenue for TRP has decreased by -13.57% in the past year. This is quite bad
TRP shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 0.77% yearly.
EPS 1Y (TTM)-5.45%
EPS 3Y-0.05%
EPS 5Y0.64%
EPS Q2Q%-21.2%
Revenue 1Y (TTM)-13.57%
Revenue growth 3Y0.95%
Revenue growth 5Y0.77%
Sales Q2Q%-14.39%
3.2 Future
Based on estimates for the next years, TRP will show a small growth in Earnings Per Share. The EPS will grow by 3.85% on average per year.
The Revenue is expected to grow by 4.32% on average over the next years.
EPS Next Y-11.64%
EPS Next 2Y-2.8%
EPS Next 3Y-0.45%
EPS Next 5Y3.85%
Revenue Next Year-4.95%
Revenue Next 2Y0.5%
Revenue Next 3Y1.07%
Revenue Next 5Y4.32%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
TRP is valuated correctly with a Price/Earnings ratio of 15.43.
Based on the Price/Earnings ratio, TRP is valued a bit cheaper than the industry average as 61.09% of the companies are valued more expensively.
When comparing the Price/Earnings ratio of TRP to the average of the S&P500 Index (29.35), we can say TRP is valued slightly cheaper.
The Price/Forward Earnings ratio is 17.45, which indicates a rather expensive current valuation of TRP.
Compared to the rest of the industry, the Price/Forward Earnings ratio of TRP is on the same level as its industry peers.
Compared to an average S&P500 Price/Forward Earnings ratio of 22.10, TRP is valued a bit cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.43 | ||
| Fwd PE | 17.45 |
4.2 Price Multiples
The rest of the industry has a similar Enterprise Value to EBITDA ratio as TRP.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of TRP is on the same level as its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 51.18 | ||
| EV/EBITDA | 14.62 |
4.3 Compensation for Growth
The decent profitability rating of TRP may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)24.18
EPS Next 2Y-2.8%
EPS Next 3Y-0.45%
5. Dividend
5.1 Amount
TRP has a Yearly Dividend Yield of 5.22%, which is a nice return.
Compared to an average industry Dividend Yield of 6.94, TRP pays a better dividend. On top of this TRP pays more dividend than 80.09% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 2.33, TRP pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 5.22% |
5.2 History
On average, the dividend of TRP grows each year by 13.09%, which is quite nice.
TRP has been paying a dividend for at least 10 years, so it has a reliable track record.
Dividend Growth(5Y)13.09%
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
88.20% of the earnings are spent on dividend by TRP. This is not a sustainable payout ratio.
The dividend of TRP is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP88.2%
EPS Next 2Y-2.8%
EPS Next 3Y-0.45%
TSX:TRP (3/7/2025, 7:00:00 PM)
65.9
+0.8 (+1.23%)
Chartmill FA Rating
GICS SectorEnergy
GICS IndustryGroupEnergy
GICS IndustryOil, Gas & Consumable Fuels
Earnings (Last)
Earnings (Next)
Inst Owners75.89%
Inst Owner ChangeN/A
Ins Owners0.1%
Ins Owner ChangeN/A
Market Cap68.48B
Analysts72.31
Price Target73.82 (12.02%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 5.22% |
Yearly Dividend3.9
Dividend Growth(5Y)13.09%
DP88.2%
Div Incr Years0
Div Non Decr Years0
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)7.06%
Min EPS beat(2)6.8%
Max EPS beat(2)7.33%
EPS beat(4)4
Avg EPS beat(4)5.8%
Min EPS beat(4)1.8%
Max EPS beat(4)7.33%
EPS beat(8)7
Avg EPS beat(8)6.16%
EPS beat(12)9
Avg EPS beat(12)4.74%
EPS beat(16)11
Avg EPS beat(16)4.27%
Revenue beat(2)1
Avg Revenue beat(2)-0.03%
Min Revenue beat(2)-1.99%
Max Revenue beat(2)1.92%
Revenue beat(4)2
Avg Revenue beat(4)1.49%
Min Revenue beat(4)-1.99%
Max Revenue beat(4)6.32%
Revenue beat(8)4
Avg Revenue beat(8)1.02%
Revenue beat(12)7
Avg Revenue beat(12)1.62%
Revenue beat(16)7
Avg Revenue beat(16)-0.11%
PT rev (1m)2.41%
PT rev (3m)3.82%
EPS NQ rev (1m)0%
EPS NQ rev (3m)2.7%
EPS NY rev (1m)-0.12%
EPS NY rev (3m)-0.1%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)1.1%
Revenue NY rev (1m)1.79%
Revenue NY rev (3m)2.23%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.43 | ||
| Fwd PE | 17.45 | ||
| P/S | 4.97 | ||
| P/FCF | 51.18 | ||
| P/OCF | 8.9 | ||
| P/B | 2.48 | ||
| P/tB | 4.92 | ||
| EV/EBITDA | 14.62 |
EPS(TTM)4.27
EY6.48%
EPS(NY)3.78
Fwd EY5.73%
FCF(TTM)1.29
FCFY1.95%
OCF(TTM)7.41
OCFY11.24%
SpS13.25
BVpS26.55
TBVpS13.4
PEG (NY)N/A
PEG (5Y)24.18
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.89% | ||
| ROE | 16.65% | ||
| ROCE | 5.37% | ||
| ROIC | 4.25% | ||
| ROICexc | 4.31% | ||
| ROICexgc | 4.94% | ||
| OM | 42.02% | ||
| PM (TTM) | 33.36% | ||
| GM | 67.95% | ||
| FCFM | 9.72% |
ROA(3y)2.24%
ROA(5y)2.58%
ROE(3y)9.37%
ROE(5y)9.55%
ROIC(3y)4.35%
ROIC(5y)4.58%
ROICexc(3y)4.42%
ROICexc(5y)4.65%
ROICexgc(3y)5.04%
ROICexgc(5y)5.34%
ROCE(3y)5.6%
ROCE(5y)5.97%
ROICexcg growth 3Y-4.34%
ROICexcg growth 5Y-4.28%
ROICexc growth 3Y-4.22%
ROICexc growth 5Y-3.48%
OM growth 3Y-1.61%
OM growth 5Y-0.76%
PM growth 3Y35%
PM growth 5Y2.15%
GM growth 3Y-0.69%
GM growth 5Y-0.74%
F-Score5
Asset Turnover0.12
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.04 | ||
| Debt/FCF | 44.37 | ||
| Debt/EBITDA | 6.58 | ||
| Cap/Depr | 228.05% | ||
| Cap/Sales | 46.17% | ||
| Interest Coverage | 1.7 | ||
| Cash Conversion | 89.76% | ||
| Profit Quality | 29.12% | ||
| Current Ratio | 0.55 | ||
| Quick Ratio | 0.47 | ||
| Altman-Z | 0.62 |
F-Score5
WACC7.28%
ROIC/WACC0.58
Cap/Depr(3y)260.57%
Cap/Depr(5y)266.14%
Cap/Sales(3y)50.84%
Cap/Sales(5y)51.87%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-5.45%
EPS 3Y-0.05%
EPS 5Y0.64%
EPS Q2Q%-21.2%
EPS Next Y-11.64%
EPS Next 2Y-2.8%
EPS Next 3Y-0.45%
EPS Next 5Y3.85%
Revenue 1Y (TTM)-13.57%
Revenue growth 3Y0.95%
Revenue growth 5Y0.77%
Sales Q2Q%-14.39%
Revenue Next Year-4.95%
Revenue Next 2Y0.5%
Revenue Next 3Y1.07%
Revenue Next 5Y4.32%
EBIT growth 1Y-15.59%
EBIT growth 3Y-0.68%
EBIT growth 5Y0%
EBIT Next Year28.27%
EBIT Next 3Y12.83%
EBIT Next 5Y10.43%
FCF growth 1Y251.87%
FCF growth 3Y11.47%
FCF growth 5YN/A
OCF growth 1Y5.89%
OCF growth 3Y3.76%
OCF growth 5Y1.68%