FirstEnergy Corp

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FE : NYSE : Utilities
$31.36 up 0.11 | 0.35%
Today's Range: 31.16 - 31.41
Avg. Daily Volume: 4351100.0
09/19/17 - 3:59 PM ET

Financial Analysis


FIRSTENERGY CORP's gross profit margin for the second quarter of its fiscal year 2017 has increased when compared to the same period a year ago. Even though sales decreased, the net income has increased. FIRSTENERGY CORP has very weak liquidity. Currently, the Quick Ratio is 0.36 which clearly shows a lack of ability to cover short-term cash needs. The company's liquidity has increased from the same period last year.

At the same time, stockholders' equity ("net worth") has significantly decreased by 44.59% from the same quarter last year. The key liquidity measurements indicate that the company is in a position in which financial difficulties could develop in the near future.

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Income Statement Q2 FY17 Q2 FY16
Net Sales ($mil)3309.03401.0
EBITDA ($mil)1021.0927.0
EBIT ($mil)675.0530.0
Net Income ($mil)174.0-1089.0


Balance Sheet Q2 FY17 Q2 FY16
Cash & Equiv. ($mil)114.0199.0
Total Assets ($mil)43327.051401.0
Total Debt ($mil)22822.022600.0
Equity ($mil)6320.011407.0


Profitability Q2 FY17 Q2 FY16
Gross Profit Margin30.8627.26
EBITDA Margin30.8527.25
Operating Margin20.415.58
Sales Turnover0.330.29
Return on Assets-11.62-1.15
Return on Equity-79.69-5.18
Debt Q2 FY17 Q2 FY16
Current Ratio0.590.46
Debt/Capital0.780.66
Interest Expense290.0287.0
Interest Coverage2.331.85


Share Data Q2 FY17 Q2 FY16
Shares outstanding (mil)444.3425.2
Div / share0.360.36
EPS0.39-2.56
Book value / share14.2226.83
Institutional Own % n/a n/a
Avg Daily Volume4446201.04166433.0

Valuation


HOLD. The current P/E ratio is negative, which has no meaningful value in the assessment of premium or discount valuation, it simply displays that the company has negative earnings. Conducting a second comparison, its price-to-book ratio of 2.22 indicates a discount versus the S&P 500 average of 3.10 and a premium versus the industry average of 2.04. The price-to-sales ratio is well below both the S&P 500 average and the industry average, indicating a discount. After reviewing these and other key valuation criteria, FIRSTENERGY CORP proves to trade at a premium to investment alternatives within the industry.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
FE NM Peers 27.92   FE 4.21 Peers 8.86

Neutral. The absence of a valid P/E ratio happens when a stock can not be valued on the basis of a negative stream of earnings.

FE's P/E is negative making this valuation measure meaningless.

 

Discount. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.

FE is trading at a significant discount to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
FE 12.66 Peers 19.36   FE NA Peers 2.26

Discount. A lower price-to-projected earnings ratio than its peers can signify a less expensive stock or lower future growth expectations.

FE is trading at a significant discount to its peers.

 

Neutral. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.

Ratio not available.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
FE 2.22 Peers 2.04   FE -741.72 Peers -4.09

Average. A lower price-to-book ratio makes a stock more attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

FE is trading at a valuation on par with its peers.

 

Lower. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

However, FE is expected to significantly trail its peers on the basis of its earnings growth rate.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
FE 0.99 Peers 2.37   FE -5.30 Peers 14.17

Discount. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.

FE is trading at a significant discount to its industry on this measurement.

 

Lower. A sales growth rate that trails the industry implies that a company is losing market share.

FE significantly trails its peers on the basis of sales growth

 

 

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