Executive Summary
Hydro One Limited, through its subsidiaries, operates as an electrical transmission and distribution company in Ontario.
Snowflake Analysis
Second-rate dividend payer and slightly overvalued.
Similar Companies
Share Price & News
How has Hydro One's share price performed over time and what events caused price changes?
Latest Share Price and Events
Stable Share Price: H has not had significant price volatility in the past 3 months.
Market Performance
7 Day Return
-1.4%
H
1.7%
CA Electric Utilities
1.0%
CA Market
1 Year Return
18.9%
H
-4.3%
CA Electric Utilities
-23.3%
CA Market
Return vs Industry: H exceeded the Canadian Electric Utilities industry which returned 0.7% over the past year.
Return vs Market: H exceeded the Canadian Market which returned -23.7% over the past year.
Shareholder returns
| H | Industry | Market | |
|---|---|---|---|
| 7 Day | -1.4% | 1.7% | 1.0% |
| 30 Day | -10.4% | -17.1% | -19.9% |
| 90 Day | -0.08% | -14.3% | -23.8% |
| 1 Year | 23.6%18.9% | -1.2%-4.3% | -20.8%-23.3% |
| 3 Year | 16.5%2.9% | 16.6%5.3% | -12.7%-20.9% |
| 5 Year | n/a | 46.7%22.3% | -0.1%-15.0% |
Price Volatility Vs. Market
How volatile is Hydro One's share price compared to the market and industry in the last 5 years?
Simply Wall St News
2 weeks ago | Simply Wall St
Know This Before Buying Hydro One Limited (TSE:H) For Its Dividend1 month ago | Simply Wall St
Taking A Look At Hydro One Limited's (TSE:H) ROE1 month ago | Simply Wall St
Hydro One Limited Released Earnings Last Week And Analysts Lifted Their Price Target To CA$27.40Valuation
Is Hydro One undervalued compared to its fair value and its price relative to the market?
19.08x
Price to Earnings (PE) ratio
Share Price vs. Fair Value
Below Fair Value: H (CA$25.34) is trading above our estimate of fair value (CA$24.23)
Significantly Below Fair Value: H is trading above our estimate of fair value.
Price To Earnings Ratio
PE vs Industry: H is good value based on its PE Ratio (19.4x) compared to the Electric Utilities industry average (19.8x).
PE vs Market: H is poor value based on its PE Ratio (19.4x) compared to the Canadian market (10.4x).
Price to Earnings Growth Ratio
PEG Ratio: H is poor value based on its PEG Ratio (3.7x)
Price to Book Ratio
PB vs Industry: H is good value based on its PB Ratio (1.6x) compared to the XN Electric Utilities industry average (1.8x).
Next Steps
Future Growth
How is Hydro One forecast to perform in the next 1 to 3 years based on estimates from 11 analysts?
5.3%
Forecasted annual earnings growth
Earnings and Revenue Growth Forecasts
Analyst Future Growth Forecasts
Earnings vs Savings Rate: H's forecast earnings growth (5.3% per year) is above the savings rate (1.4%).
Earnings vs Market: H's earnings (5.3% per year) are forecast to grow slower than the Canadian market (7.1% per year).
High Growth Earnings: H's earnings are forecast to grow, but not significantly.
Revenue vs Market: H's revenue (3.1% per year) is forecast to grow slower than the Canadian market (3.7% per year).
High Growth Revenue: H's revenue (3.1% per year) is forecast to grow slower than 20% per year.
Earnings per Share Growth Forecasts
Future Return on Equity
Future ROE: H's Return on Equity is forecast to be low in 3 years time (8.9%).
Next Steps
Past Performance
How has Hydro One performed over the past 5 years?
-21.5%
Historical annual earnings growth
Earnings and Revenue History
Quality Earnings: H has high quality earnings.
Growing Profit Margin: H became profitable in the past.
Past Earnings Growth Analysis
Earnings Trend: H's earnings have declined by -21.5% per year over the past 5 years.
Accelerating Growth: H has become profitable in the last year, making the earnings growth rate difficult to compare to its 5-year average.
Earnings vs Industry: H has become profitable in the last year, making it difficult to compare its past year earnings growth to the Electric Utilities industry (6%).
Return on Equity
High ROE: H's Return on Equity (8.1%) is considered low.
Next Steps
Financial Health
How is Hydro One's financial position?
Financial Position Analysis
Short Term Liabilities: H's short term assets (CA$1.3B) do not cover its short term liabilities (CA$3.1B).
Long Term Liabilities: H's short term assets (CA$1.3B) do not cover its long term liabilities (CA$14.1B).
Debt to Equity History and Analysis
Debt Level: H's debt to equity ratio (127.9%) is considered high.
Reducing Debt: H's debt to equity ratio has increased from 112.3% to 127.9% over the past 5 years.
Debt Coverage: H's debt is not well covered by operating cash flow (12.8%).
Interest Coverage: H's interest payments on its debt are well covered by EBIT (3.1x coverage).
Balance Sheet
Inventory Level: H has a high level of physical assets or inventory.
Debt Coverage by Assets: H's debt is not covered by short term assets (assets are 0.1x debt).
Next Steps
Dividend
What is Hydro One's current dividend yield, its reliability and sustainability?
3.88%
Current Dividend Yield
Dividend Yield vs Market
Notable Dividend: H's dividend (3.81%) is higher than the bottom 25% of dividend payers in the Canadian market (2.69%).
High Dividend: H's dividend (3.81%) is low compared to the top 25% of dividend payers in the Canadian market (8.66%).
Stability and Growth of Payments
Stable Dividend: Whilst dividend payments have been stable, H has been paying a dividend for less than 10 years.
Growing Dividend: H's dividend payments have increased, but the company has only paid a dividend for 4 years.
Current Payout to Shareholders
Dividend Coverage: With its reasonable payout ratio (73.2%), H's dividend payments are covered by earnings.
Future Payout to Shareholders
Future Dividend Coverage: H's dividends in 3 years are forecast to be covered by earnings (71.8% payout ratio).
Next Steps
Management
How experienced are the management team and are they aligned to shareholders interests?
1.1yrs
Average management tenure
CEO
Mark Poweska (49yo)
0.92
Tenure
CA$860,387
Compensation
Mr. Mark Poweska, P.Eng. is President, CEO and Director at Hydro One Inc. since May 10, 2019. Mr. Poweska is a Director at Ontario Energy Association. Mr. Poweska has been the President, Chief Executive Of ...
CEO Compensation Analysis
Compensation vs Market: Mark's total compensation ($USD607.00K) is below average for companies of similar size in the Canadian market ($USD6.66M).
Compensation vs Earnings: Insufficient data to compare Mark's compensation with company performance.
Leadership Team
| Name | Position | Tenure | Compensation | Ownership |
|---|---|---|---|---|
| President | 0.92yr | CA$860.39k | 0.000030% CA$4.5k | |
| Chief Financial Officer | 1.58yrs | CA$909.03k | 0.0031% CA$456.2k | |
| Chief Information Officer | 1.25yrs | CA$544.27k | 0.000080% CA$11.9k | |
| Chief Human Resources Officer | 1yr | CA$730.80k | 0.00030% CA$44.6k | |
| Chief Corporate Affairs & Customer Care Officer | 1.67yrs | CA$586.00k | 0.0014% CA$202.1k | |
| Chief Operating Officer | 0.25yr | no data | no data | |
| Vice President of Investor Relations | no data | no data | no data | |
| Chief Compliance Officer | 5.33yrs | CA$402.38k | no data | |
| Executive VP & Chief Legal Officer | 0.58yr | no data | no data | |
| Director of Corporate Communications | no data | no data | no data |
1.1yrs
Average Tenure
48.5yo
Average Age
Experienced Management: H's management team is not considered experienced ( 1.1 years average tenure), which suggests a new team.
Board Members
| Name | Position | Tenure | Compensation | Ownership |
|---|---|---|---|---|
| President | 0.92yr | CA$860.39k | 0.000030% CA$4.5k | |
| Independent Director | 1.67yrs | CA$98.92k | 0.000020% CA$3.0k | |
| Independent Director | 1.67yrs | CA$102.15k | no data | |
| Independent Director | 1.67yrs | CA$94.44k | no data | |
| Independent Director | 1.67yrs | CA$103.15k | no data | |
| Independent Director | 1.67yrs | CA$104.65k | 0.00034% CA$50.5k | |
| Independent Chairman of the Board | 0.67yr | CA$111.07k | no data | |
| Independent Director | 1.67yrs | CA$97.67k | no data | |
| Independent Director | 1.67yrs | CA$97.44k | no data | |
| Independent Director | 1.67yrs | CA$94.44k | no data |
1.7yrs
Average Tenure
58.5yo
Average Age
Experienced Board: H's board of directors are not considered experienced ( 1.7 years average tenure), which suggests a new board.
Ownership
Who are the major shareholders and have insiders been buying or selling?
Insider Trading Volume
Insider Buying: H 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.
Top Shareholders
Company Information
Hydro One Limited's company bio, employee growth, exchange listings and data sources
Key Information
- Name: Hydro One Limited
- Ticker: H
- Exchange: TSX
- Founded: 2015
- Industry: Electric Utilities
- Sector: Utilities
- Market Cap: CA$14.861b
- Shares outstanding: 597.06m
- Website: https://www.hydroone.com
Number of Employees
Location
- Hydro One Limited
- South Tower
- 8th Floor
- Toronto
- Ontario
- M5G 2P5
- Canada
Listings
| Ticker | Exchange | Primary Security | Security Type | Country | Currency | Listed on |
|---|---|---|---|---|---|---|
| H | TSX (The Toronto Stock Exchange) | Yes | New Common Stock | CA | CAD | Nov 2015 |
| HRNN.F | OTCPK (Pink Sheets LLC) | Yes | New Common Stock | US | USD | Nov 2015 |
| 8H1 | DB (Deutsche Boerse AG) | Yes | New Common Stock | DE | EUR | Nov 2015 |
Biography
Hydro One Limited, through its subsidiaries, operates as an electrical transmission and distribution company in Ontario. It operates through three segments: Transmission, Distribution, and Other Business. The company owns and operates approximately 123,000 circuit kilometers of low-voltage distribution network. It serves approximately 1.4 million residential, small business, commercial, and industrial customers. The company also provides telecommunications support services for its transmission and distribution businesses; and communications and information technology solutions to organizations for broadband network connectivity. Hydro One Limited was incorporated in 2015 and is headquartered in Toronto, Canada.
Company Analysis and Financial Data Status
| Data | Last Updated (UTC time) |
|---|---|
| Company Analysis | 2020/04/02 04:06 |
| End of Day Share Price | 2020/04/01 00:00 |
| Earnings | 2019/12/31 |
| Annual Earnings | 2019/12/31 |
Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.