Hydraulic Elements and Systems AD (BUL:HES) - Share price, News & Analysis

Q: What is the Fair Price of HES when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

HES (BGN6.8) is trading above our estimate of [[fair value]] (BGN4.43)

HES fundamental analysis
Snowflake Score
Valuation	1/6
Future Growth	0/6
Past Performance	2/6
Financial Health	5/6
Dividends	3/6

HES Stock Overview

Hydraulic Elements and Systems AD designs, manufactures, and sells hydraulic cylinders in Europe, North America, and Asia.

Rewards

Price-To-Earnings ratio (13.8x) is below the BG market (14.1x)

Earnings have grown 17.4% per year over the past 5 years

Risk Analysis

Dividend of 4.56% is not well covered by earnings

Profit margins (10.4%) are lower than last year (15%)

Does not have a meaningful market cap (BGN124M)

Hydraulic Elements and Systems AD Competitors

Stara Planina Hold

BUL:SPH

лв187.0m

M+S Hydraulic AD

BUL:MSH

лв347.0m

Vipom AD

BUL:VPOM

лв2.2m

Industrial Holding Bulgaria AD

BUL:IHB

лв218.8m

Price History & Performance

Summary of all time highs, changes and price drops for Hydraulic Elements and Systems AD
Historical stock prices
Current Share Price	лв6.80
52 Week High	лв7.10
52 Week Low	лв5.80
Beta	0.27
1 Month Change	3.03%
3 Month Change	-3.55%
1 Year Change	15.25%
3 Year Change	41.67%
5 Year Change	23.52%
Change since IPO	104.00%

Recent News & Updates

May 24

Hydraulic Elements and Systems AD's (BUL:HES) Shareholders Will Receive A Bigger Dividend Than Last Year

Hydraulic Elements and Systems AD ( BUL:HES ) will increase its dividend on the 7th of July to лв0.31. This will take...

Shareholder Returns

	HES	BG Machinery	BG Market
7D	0%	2.1%	0.9%
1Y	15.3%	19.7%	9.5%

Return vs Industry: HES underperformed the BG Machinery industry which returned 19.7% over the past year.

Return vs Market: HES exceeded the BG Market which returned 9.5% over the past year.

Price Volatility

Is HES's price volatile compared to industry and market?
HES volatility
HES Average Weekly Movement	2.9%
Machinery Industry Average Movement	5.7%
Market Average Movement	5.2%
10% most volatile stocks in BG Market	8.8%
10% least volatile stocks in BG Market	2.5%

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

Volatility Over Time: HES's weekly volatility (3%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
1968	586	n/a	https://www.hes.bg

Hydraulic Elements and Systems AD designs, manufactures, and sells hydraulic cylinders in Europe, North America, and Asia. The company offers piston hydraulic cylinders for agriculture machines, presses, conveyers etc.; plunger hydraulic cylinders for presses, forklifts, lifting platforms, etc.; telescopic hydraulic cylinders for dumping trailers or dumper vehicles, forklifts, lifting platforms, garbage trucks and transfer trailers, and roll-on/roll-off trucks; and rack cylinders, as well as provides axial piston machines. Its products are also used in construction machinery; mining machinery and equipment; community waste collection and cleaning machines; ships and harbor works; and forestry machines.

Hydraulic Elements and Systems AD Fundamentals Summary

How do Hydraulic Elements and Systems AD's earnings and revenue compare to its market cap?
HES fundamental statistics
Market Cap	лв123.72m
Earnings (TTM)	лв8.97m
Revenue (TTM)	лв86.02m

13.8x

P/E Ratio

1.4x

P/S Ratio

Is HES overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
HES income statement (TTM)
Revenue	лв86.02m
Cost of Revenue	лв47.69m
Gross Profit	лв38.33m
Other Expenses	лв29.37m
Earnings	лв8.97m

Last Reported Earnings

Jun 30, 2022

Next Earnings Date

n/a

Earnings per share (EPS)	0.49
Gross Margin	44.56%
Net Profit Margin	10.42%
Debt/Equity Ratio	6.7%

How did HES perform over the long term?

See historical performance and comparison

Dividends

4.6%

Current Dividend Yield

63%

Payout Ratio

We’ve recently updated our valuation analysis.

Valuation

Is HES undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

1/6

Valuation Score 1/6

Price-To-Earnings vs Peers
Price-To-Earnings vs Industry
Price-To-Earnings vs Fair Ratio
Below Fair Value
Significantly Below Fair Value
Analyst Forecast

Key Valuation Metric

Which metric is best to use when looking at relative valuation for HES?

Other financial metrics that can be useful for relative valuation.

The above table shows the n/a ratio for HES. This is calculated by dividing HES's market cap by their current preferred multiple.
What is HES's n/a Ratio?
n/a Ratio	0x
n/a	n/a
Market Cap	лв123.72m

HES key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue	1.4x
Enterprise Value/EBITDA	8.3x
PEG Ratio	n/a

Price to Earnings Ratio vs Peers

How does HES's PE Ratio compare to its peers?

HES PE Ratio vs Peers

The above table shows the PE ratio for HES vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	PE	Estimated Growth	Market Cap
Peer Average	13.2x
SPH Stara Planina Hold	14.1x	n/a	лв187.0m
MSH M+S Hydraulic AD	15.4x	n/a	лв347.0m
VPOM Vipom AD	14.8x	n/a	лв2.2m
IHB Industrial Holding Bulgaria AD	8.4x	n/a	лв218.8m
HES Hydraulic Elements and Systems AD	13.8x	n/a	лв123.7m

Price-To-Earnings vs Peers: HES is expensive based on its Price-To-Earnings Ratio (13.8x) compared to the peer average (13.2x).

Price to Earnings Ratio vs Industry

How does HES's PE Ratio compare vs other companies in the European Machinery Industry?

Price-To-Earnings vs Industry: HES is good value based on its Price-To-Earnings Ratio (13.8x) compared to the BG Machinery industry average (13.9x)

Price to Earnings Ratio vs Fair Ratio

What is HES's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

HES PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio	13.8x
Fair PE Ratio	n/a

Price-To-Earnings vs Fair Ratio: Insufficient data to calculate HES's Price-To-Earnings Fair Ratio for valuation analysis.

Share Price vs Fair Value

What is the Fair Price of HES when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: HES (BGN6.8) is trading above our estimate of fair value (BGN4.43)

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

Analyst Price Targets

What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?

Analyst Forecast: Insufficient data to show price forecast.

Discover undervalued companies

Future Growth

How is Hydraulic Elements and Systems AD forecast to perform in the next 1 to 3 years based on estimates from 0 analysts?

Future Growth Score

0/6

Future Growth Score 0/6

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

13.1%

Forecasted Capital Goods industry annual growth in earnings

In this section we usually present revenue and earnings growth projections based on the consensus estimates of professional analysts to help investors understand the company’s ability to generate profit. But as Hydraulic Elements and Systems AD has not provided enough past data and has no analyst forecast, its future earnings cannot be reliably calculated by extrapolating past data or using analyst predictions.

This is quite a rare situation as 97% of companies covered by SimplyWall St do have past financial data.

Discover growth companies

Examine Hydraulic Elements and Systems AD's financial health to determine how well-positioned it is against times of financial stress by looking at its level of debt over time and how much cash it has left.

Past Performance

How has Hydraulic Elements and Systems AD performed over the past 5 years?

Past Performance Score

2/6

Past Performance Score 2/6

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

17.4%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: HES has high quality earnings.

Growing Profit Margin: HES's current net profit margins (10.4%) are lower than last year (15%).

Past Earnings Growth Analysis

Earnings Trend: HES's earnings have grown by 17.4% per year over the past 5 years.

Accelerating Growth: HES's earnings growth over the past year (4.6%) is below its 5-year average (17.4% per year).

Earnings vs Industry: HES earnings growth over the past year (4.6%) underperformed the Machinery industry 28.5%.

Return on Equity

High ROE: HES's Return on Equity (20%) is considered low.

Discover strong past performing companies

Financial Health

How is Hydraulic Elements and Systems AD's financial position?

Financial Health Score

5/6

Financial Health Score 5/6

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

Financial Position Analysis

Short Term Liabilities: HES's short term assets (BGN37.0M) exceed its short term liabilities (BGN21.9M).

Long Term Liabilities: HES's short term assets (BGN37.0M) exceed its long term liabilities (BGN939.0K).

Debt to Equity History and Analysis

Debt Level: HES has more cash than its total debt.

Reducing Debt: HES's debt to equity ratio has increased from 0.1% to 6.7% over the past 5 years.

Debt Coverage: HES's debt is well covered by operating cash flow (202.1%).

Interest Coverage: HES's interest payments on its debt are well covered by EBIT (593.4x coverage).

Balance Sheet

Discover healthy companies

Dividend

What is Hydraulic Elements and Systems AD current dividend yield, its reliability and sustainability?

Dividend Score

3/6

Dividend Score 3/6

Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Cash Flow Coverage

4.56%

Current Dividend Yield

Dividend Yield vs Market

Notable Dividend: HES's dividend (4.56%) is higher than the bottom 25% of dividend payers in the BG market (1.31%).

High Dividend: HES's dividend (4.56%) is low compared to the top 25% of dividend payers in the BG market (6.12%).

Stability and Growth of Payments

Stable Dividend: HES's dividend payments have been volatile in the past 10 years.

Growing Dividend: HES's dividend payments have increased over the past 10 years.

Earnings Payout to Shareholders

Earnings Coverage: With its reasonable payout ratio (62.9%), HES's dividend payments are covered by earnings.

Cash Payout to Shareholders

Cash Flow Coverage: With its high cash payout ratio (256%), HES's dividend payments are not well covered by cash flows.

Discover strong dividend paying companies

Management

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

CEO

Hydraulic Elements and Systems AD has no CEO, or we have no data on them.

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.

Ownership Breakdown

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

Data	Last Updated (UTC time)
Company Analysis	2022/08/14 00:00
End of Day Share Price	2022/08/12 00:00
Earnings	2022/06/30
Annual Earnings	2021/12/31