Z Energy (CHIA:ZEL) - Share price, News & Analysis

ZEL fundamental analysis
Snowflake Score
Valuation	3/6
Future Growth	1/6
Past Performance	1/6
Financial Health	4/6
Dividends	2/6

ZEL Stock Overview

Z Energy Limited sells transport fuel in New Zealand.

Rewards

PE ratio (9.3x) is below the Australian market (17.1x)

Revenue is forecast to grow 6.31% per year

Became profitable this year

Risk Analysis

Earnings are forecast to decline by an average of 19% per year for the next 3 years

Debt is not well covered by operating cash flow

High level of non-cash earnings

Dividend of 3.71% is not well covered by earnings

Price History & Performance

Summary of all time highs, changes and price drops for Z Energy
Historical stock prices
Current Share Price	NZ$3.45
52 Week High	NZ$3.51
52 Week Low	NZ$2.35
Beta	0.80
1 Month Change	-0.14%
3 Month Change	3.29%
1 Year Change	39.68%
3 Year Change	-40.82%
5 Year Change	-46.84%
Change since IPO	-2.82%

Shareholder Returns

	ZEL	AU Oil and Gas	AU Market
7D	0%	1.5%	0.4%
1Y	39.7%	32.6%	3.1%

Return vs Industry: ZEL exceeded the Australian Oil and Gas industry which returned 32.6% over the past year.

Return vs Market: ZEL exceeded the Australian Market which returned 3.1% over the past year.

Price Volatility

Is ZEL's price volatile compared to industry and market?
ZEL volatility
ZEL Average Weekly Movement	1.2%
Oil and Gas Industry Average Movement	12.8%
Market Average Movement	9.2%
10% most volatile stocks in AU Market	16.5%
10% least volatile stocks in AU Market	4.2%

Stable Share Price: ZEL is less volatile than 75% of Australian stocks over the past 3 months, typically moving +/- 1% a week.

Volatility Over Time: ZEL's weekly volatility (1%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
1959	2,121	Mike Bennetts	https://www.z.co.nz

Z Energy Limited sells transport fuel in New Zealand. It supplies fuel to retail customers, as well as commercial customers, such as airlines, trucking companies, shipping companies, and vehicle fleet operators, as well as supplies bitumen to roading contractors. The company also offers Z Business Plus, a fuel card for businesses to buy fuels.

Z Energy Fundamentals Summary

How do Z Energy's earnings and revenue compare to its market cap?
ZEL fundamental statistics
Market Cap	NZ$1.96b
Earnings (TTM)	NZ$210.00m
Revenue (TTM)	NZ$4.19b

9.3x

P/E Ratio

0.5x

P/S Ratio

Is ZEL overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
ZEL income statement (TTM)
Revenue	NZ$4.19b
Cost of Revenue	NZ$3.41b
Gross Profit	NZ$785.00m
Other Expenses	NZ$575.00m
Earnings	NZ$210.00m

Last Reported Earnings

Sep 30, 2021

Next Earnings Date

May 16, 2022

Earnings per share (EPS)	0.40
Gross Margin	18.74%
Net Profit Margin	5.01%
Debt/Equity Ratio	86.5%

How did ZEL perform over the long term?

See historical performance and comparison

Dividends

3.7%

Current Dividend Yield

56%

Payout Ratio

Valuation

Is Z Energy undervalued compared to its fair value and its price relative to the market?

Valuation Score

3/6

Valuation Score 3/6

Below Fair Value
Significantly Below Fair Value
PE vs Industry
PE vs Market
PEG Ratio
PB vs Industry

9.32x

Price to Earnings (PE) ratio

Share Price vs. Fair Value

Below Fair Value: ZEL (A$3.45) is trading above our estimate of fair value (A$2.39)

Significantly Below Fair Value: ZEL is trading above our estimate of fair value.

Price To Earnings Ratio

PE vs Industry: ZEL is good value based on its PE Ratio (9.3x) compared to the Australian Oil and Gas industry average (12x).

PE vs Market: ZEL is good value based on its PE Ratio (9.3x) compared to the Australian market (17.1x).

Price to Earnings Growth Ratio

PEG Ratio: ZEL's earnings are forecast to decline next year, so we can't calculate its PEG ratio.

Price to Book Ratio

PB vs Industry: ZEL is good value based on its PB Ratio (1.7x) compared to the AU Oil and Gas industry average (2.3x).

Future Growth

How is Z Energy forecast to perform in the next 1 to 3 years based on estimates from 2 analysts?

Future Growth Score

1/6

Future Growth Score 1/6

Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Future ROE

-19.0%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: ZEL's earnings are forecast to decline over the next 3 years (-19% per year).

Earnings vs Market: ZEL's earnings are forecast to decline over the next 3 years (-19% per year).

High Growth Earnings: ZEL's earnings are forecast to decline over the next 3 years.

Revenue vs Market: ZEL's revenue (6.3% per year) is forecast to grow faster than the Australian market (5.1% per year).

High Growth Revenue: ZEL's revenue (6.3% per year) is forecast to grow slower than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: Insufficient data to determine if ZEL's Return on Equity is forecast to be high in 3 years time

Past Performance

How has Z Energy performed over the past 5 years?

Past Performance Score

1/6

Past Performance Score 1/6

Quality Earnings
Growing Profit Margin
Earnings Trend
Accelerating Growth
Earnings vs Industry
High ROE

-28.8%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: ZEL has a high level of non-cash earnings.

Growing Profit Margin: ZEL became profitable in the past.

Past Earnings Growth Analysis

Earnings Trend: ZEL's earnings have declined by 28.8% per year over the past 5 years.

Accelerating Growth: ZEL has become profitable in the last year, making the earnings growth rate difficult to compare to its 5-year average.

Earnings vs Industry: ZEL has become profitable in the last year, making it difficult to compare its past year earnings growth to the Oil and Gas industry (396.5%).

Return on Equity

High ROE: ZEL's Return on Equity (17.6%) is considered low.

Financial Health

How is Z Energy's financial position?

Financial Health Score

4/6

Financial Health Score 4/6

Short Term Liabilities
Long Term Liabilities
Debt Level
Reducing Debt
Debt Coverage
Interest Coverage

Financial Position Analysis

Short Term Liabilities: ZEL's short term assets (NZ$1.2B) exceed its short term liabilities (NZ$1.1B).

Long Term Liabilities: ZEL's short term assets (NZ$1.2B) exceed its long term liabilities (NZ$1.1B).

Debt to Equity History and Analysis

Debt Level: ZEL's net debt to equity ratio (73%) is considered high.

Reducing Debt: ZEL's debt to equity ratio has reduced from 200.5% to 86.5% over the past 5 years.

Debt Coverage: ZEL's operating cash flow is negative, therefore debt is not well covered.

Interest Coverage: ZEL's interest payments on its debt are well covered by EBIT (15.5x coverage).

Balance Sheet

Dividend

What is Z Energy current dividend yield, its reliability and sustainability?

Dividend Score

2/6

Dividend Score 2/6

Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Future Dividend Coverage

3.71%

Current Dividend Yield

Dividend Yield vs Market

Notable Dividend: ZEL's dividend (3.71%) is higher than the bottom 25% of dividend payers in the Australian market (2.46%).

High Dividend: ZEL's dividend (3.71%) is low compared to the top 25% of dividend payers in the Australian market (5.86%).

Stability and Growth of Payments

Stable Dividend: ZEL has been paying a dividend for less than 10 years and during this time payments have been volatile.

Growing Dividend: ZEL has only been paying a dividend for 8 years, and since then payments have fallen.

Earnings Payout to Shareholders

Earnings Coverage: With its reasonable payout ratio (55.8%), ZEL's dividend payments are covered by earnings.

Cash Payout to Shareholders

Cash Flow Coverage: ZEL is paying a dividend but the company has no free cash flows.

Next Steps

Explore strong dividend paying companies in the Energy industry.

Management

How experienced are the management team and are they aligned to shareholders interests?

3.4yrs

Average management tenure

CEO

Mike Bennetts

12.08yrs

Tenure

Mr. Michael John Bennetts, also known as Mike, BBS, Diploma in Corporate Management, CMInstD, serves as a Member of the Management of Morrison & Co Infrastructure Management Limited - Manager for Infratil...

Leadership Team

Experienced Management: ZEL's management team is considered experienced (3.4 years average tenure).

Board Members

Experienced Board: ZEL's board of directors are considered experienced (5.6 years average tenure).

Ownership

Who are the major shareholders and have insiders been buying or selling?

Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.

Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.

Data	Last Updated (UTC time)
Company Analysis	2022/05/04 00:00
End of Day Share Price	2022/04/28 00:00
Earnings	2021/09/30
Annual Earnings	2021/03/31