Ferrovial (BME:FER) - Share price, News & Analysis

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

FER (€24.48) is trading above our estimate of [[fair value]] (€9.96)

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

FER Stock Overview

Ferrovial, S.A., together with its subsidiaries, operates as an infrastructure and mobility operator in the United States, Poland, Spain, the United Kingdom, Canada, and internationally.

Rewards

Became profitable this year

Risk Analysis

Earnings are forecast to decline by an average of 18.5% per year for the next 3 years

Interest payments are not well covered by earnings

Dividend of 2.49% is not well covered by earnings

Large one-off items impacting financial results

Ferrovial Competitors

Fomento de Construcciones y Contratas

BME:FCC

€4.1b

Elecnor

BME:ENO

€956.9m

Obrascón Huarte Lain

BME:OHLA

€358.8m

Grupo Empresarial San José

BME:GSJ

€265.6m

Price History & Performance

Summary of all time highs, changes and price drops for Ferrovial
Historical stock prices
Current Share Price	€24.48
52 Week High	€28.07
52 Week Low	€22.19
Beta	0.96
1 Month Change	1.12%
3 Month Change	1.24%
1 Year Change	-4.34%
3 Year Change	8.75%
5 Year Change	25.96%
Change since IPO	261.00%

Recent News & Updates

May 14

Here's Why Ferrovial (BME:FER) Can Manage Its Debt Responsibly

Howard Marks put it nicely when he said that, rather than worrying about share price volatility, 'The possibility of...

Apr 29

Ferrovial (BME:FER) Could Be At Risk Of Shrinking As A Company

When it comes to investing, there are some useful financial metrics that can warn us when a business is potentially in...

Apr 14

Is It Time To Consider Buying Ferrovial, S.A. (BME:FER)?

Ferrovial, S.A. ( BME:FER ) saw a decent share price growth in the teens level on the BME over the last few months...

Shareholder Returns

	FER	ES Construction	ES Market
7D	4.0%	1.0%	1.0%
1Y	-4.3%	-2.2%	-10.0%

Return vs Industry: FER underperformed the Spanish Construction industry which returned -2.2% over the past year.

Return vs Market: FER exceeded the Spanish Market which returned -10% over the past year.

Price Volatility

Is FER's price volatile compared to industry and market?
FER volatility
FER Average Weekly Movement	3.6%
Construction Industry Average Movement	3.8%
Market Average Movement	3.8%
10% most volatile stocks in ES Market	6.9%
10% least volatile stocks in ES Market	1.4%

Stable Share Price: FER is not significantly more volatile than the rest of Spanish stocks over the past 3 months, typically moving +/- 4% a week.

Volatility Over Time: FER's weekly volatility (4%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
1952	18,680	Ignacio Fernandez	https://www.ferrovial.com

Ferrovial, S.A., together with its subsidiaries, operates as an infrastructure and mobility operator in the United States, Poland, Spain, the United Kingdom, Canada, and internationally. The company engages in the design and construction of various public and private works; and development, finance, and operation of toll roads. Its construction activities include highways, tunnels, railways, bridges and viaducts, airports, intelligent toll systems, port and airport infrastructures, buildings, energy restoration, aqueducts, water treatment plants, desalination plants, digesters, thermal drying plants, chimneys and silos, caissons, storage tanks, solar power towers, oil facilities, and other construction.

Ferrovial Fundamentals Summary

How do Ferrovial's earnings and revenue compare to its market cap?
FER fundamental statistics
Market Cap	€17.83b
Earnings (TTM)	€828.00m
Revenue (TTM)	€6.78b

21.5x

P/E Ratio

2.6x

P/S Ratio

Is FER overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
FER income statement (TTM)
Revenue	€6.78b
Cost of Revenue	€1.14b
Gross Profit	€5.64b
Other Expenses	€4.81b
Earnings	€828.00m

Last Reported Earnings

Dec 31, 2021

Next Earnings Date

n/a

Earnings per share (EPS)	1.14
Gross Margin	83.14%
Net Profit Margin	12.22%
Debt/Equity Ratio	182.5%

How did FER perform over the long term?

See historical performance and comparison

Dividends

2.5%

Current Dividend Yield

44%

Payout Ratio

We’ve recently updated our valuation analysis.

Valuation

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

Valuation Score

0/6

Valuation Score 0/6

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

Key Valuation Metric

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

Other financial metrics that can be useful for relative valuation.

The above table shows the n/a ratio for FER. This is calculated by dividing FER's market cap by their current preferred multiple.
What is FER's n/a Ratio?
n/a Ratio	0x
n/a	n/a
Market Cap	€17.83b

FER 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	3.7x
Enterprise Value/EBITDA	46.7x
PEG Ratio	-1.2x

Price to Earnings Ratio vs Peers

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

FER PE Ratio vs Peers

The above table shows the PE ratio for FER vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	PE	Estimated Growth	Market Cap
Peer Average	12.4x
FCC Fomento de Construcciones y Contratas	7x	-6.4%	€4.1b
ENO Elecnor	10.7x	21.7%	€956.9m
OHLA Obrascón Huarte Lain	25.5x	41.4%	€358.8m
GSJ Grupo Empresarial San José	20.9x	18.4%	€265.6m
FER Ferrovial	21.5x	-18.5%	€17.8b

Forward PE

Price-To-Earnings vs Peers: FER is expensive based on its Price-To-Earnings Ratio (21.5x) compared to the peer average (12.4x).

Price to Earnings Ratio vs Industry

How does FER's PE Ratio compare vs other companies in the European Construction Industry?

Price-To-Earnings vs Industry: FER is expensive based on its Price-To-Earnings Ratio (21.5x) compared to the Spanish Construction industry average (11x)

Price to Earnings Ratio vs Fair Ratio

What is FER'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.

FER PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio	21.5x
Fair PE Ratio	13.3x

Price-To-Earnings vs Fair Ratio: FER is expensive based on its Price-To-Earnings Ratio (21.5x) compared to the estimated Fair Price-To-Earnings Ratio (13.3x).

Share Price vs Fair Value

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

Below Fair Value: FER (€24.48) is trading above our estimate of fair value (€9.96)

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

Price to Earnings Growth Ratio

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

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Future Growth

How is Ferrovial forecast to perform in the next 1 to 3 years based on estimates from 16 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

-18.5%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: FER's earnings are forecast to decline over the next 3 years (-18.5% per year).

Earnings vs Market: FER's earnings are forecast to decline over the next 3 years (-18.5% per year).

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

Revenue vs Market: FER's revenue (3.1% per year) is forecast to grow slower than the Spanish market (4.5% per year).

High Growth Revenue: FER'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: FER's Return on Equity is forecast to be low in 3 years time (14.7%).

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Past Performance

How has Ferrovial 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

-28.4%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: FER has a large one-off gain of €1.1B impacting its December 31 2021 financial results.

Growing Profit Margin: FER became profitable in the past.

Past Earnings Growth Analysis

Earnings Trend: FER's earnings have declined by 28.4% per year over the past 5 years.

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

Earnings vs Industry: FER has become profitable in the last year, making it difficult to compare its past year earnings growth to the Construction industry (25.6%).

Return on Equity

High ROE: FER's Return on Equity (16.7%) is considered low.

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Financial Health

How is Ferrovial's financial position?

Financial Health Score

1/6

Financial Health Score 1/6

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

Financial Position Analysis

Short Term Liabilities: FER's short term assets (€9.1B) exceed its short term liabilities (€6.6B).

Long Term Liabilities: FER's short term assets (€9.1B) do not cover its long term liabilities (€12.5B).

Debt to Equity History and Analysis

Debt Level: FER's net debt to equity ratio (88.6%) is considered high.

Reducing Debt: FER's debt to equity ratio has increased from 132.1% to 182.5% over the past 5 years.

Debt Coverage: FER's debt is not well covered by operating cash flow (7.2%).

Interest Coverage: FER's interest payments on its debt are not well covered by EBIT (1.4x coverage).

Balance Sheet

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Dividend

What is Ferrovial 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
Future Dividend Coverage

2.49%

Current Dividend Yield

Dividend Yield vs Market

Notable Dividend: FER's dividend (2.49%) is higher than the bottom 25% of dividend payers in the Spanish market (2.06%).

High Dividend: FER's dividend (2.49%) is low compared to the top 25% of dividend payers in the Spanish market (5.67%).

Stability and Growth of Payments

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

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

Earnings Payout to Shareholders

Earnings Coverage: With its reasonably low payout ratio (44.4%), FER's dividend payments are well covered by earnings.

Cash Payout to Shareholders

Cash Flow Coverage: With its high cash payout ratio (111%), FER'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?

2.6yrs

Average management tenure

CEO

Ignacio Fernandez (55 yo)

2.75yrs

Tenure

€2,529,000

Compensation

Mr. Ignacio Madridejos Fernández has been the Chief Executive Officer and Executive Director of Ferrovial, S.A. since September 30, 2019. He had been the President of CEMEX USA at CEMEX, S.A.B. de C.V. sin...

CEO Compensation Analysis

Compensation vs Market: Ignacio's total compensation ($USD2.67M) is about average for companies of similar size in the Spanish market ($USD2.61M).

Compensation vs Earnings: Ignacio's compensation has been consistent with company performance over the past year.

Leadership Team

Experienced Management: FER's management team is considered experienced (2.6 years average tenure).

Board Members

Experienced Board: FER's board of directors are considered experienced (4.5 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.

Ownership Breakdown

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

Data	Last Updated (UTC time)
Company Analysis	2022/06/26 00:00
End of Day Share Price	2022/06/24 00:00
Earnings	2021/12/31
Annual Earnings	2021/12/31