HLSE:FORTUM

Stock Analysis Report

Executive Summary

Fortum Oyj, together with its subsidiaries, engages in the generation and sale of electricity and heat in the Nordic countries, Russia, Poland, India, other parts of the Baltic Rim area, and internationally.

Snowflake

Fundamentals

6 star dividend payer with adequate balance sheet.


Similar Companies

Share Price & News

How has Fortum Oyj's share price performed over time and what events caused price changes?


Latest Share Price and Events


Market Performance


7 Day Return

0.05%

HLSE:FORTUM

2.7%

FI Electric Utilities

1.8%

FI Market


1 Year Return

-5.3%

HLSE:FORTUM

18.0%

FI Electric Utilities

-5.9%

FI Market

FORTUM underperformed the Electric Utilities industry which returned 17.2% over the past year.

FORTUM outperformed the Market in Finland which returned -6.3% over the past year.


Share holder returns

FORTUMIndustryMarket
7 Day0.05%2.7%1.8%
30 Day-3.7%1.6%-1.3%
90 Day5.1%6.3%0.8%
1 Year0.2%-5.3%22.7%18.0%-1.7%-5.9%
3 Year78.0%46.5%58.4%37.5%26.4%11.9%
5 Year49.7%5.0%41.3%5.4%53.0%23.9%

Price Volatility Vs. Market

How volatile is Fortum Oyj's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Fortum Oyj undervalued based on future cash flows and its price relative to the stock market?

37%

Discount to future cash flow value


Intrinsic Value Based on Future Cash Flows

Fortum Oyj's share price is below the future cash flow value, and at a moderate discount (> 20%).

Fortum Oyj's share price is below the future cash flow value, but not at a substantial discount (< 40%).


Price Based on Earnings

Fortum Oyj is overvalued based on earnings compared to the Europe Electric Utilities industry average.

Fortum Oyj is good value based on earnings compared to the Finland market.


Price Based on Expected Growth

Fortum Oyj is poor value based on expected growth next year.


Price Based on Value of Assets

Fortum Oyj is overvalued based on assets compared to the Europe Electric Utilities industry average.


Next Steps

Future Growth

How is Fortum Oyj expected to perform in the next 1 to 3 years based on estimates from 19 analysts?

9.5%

Forecasted annual earnings growth


Earnings and Revenue Growth Estimates


Future Annual Growth Analysis

Fortum Oyj's revenue is expected to grow by 0.1% yearly, however this is not considered high growth (20% yearly).

Fortum Oyj's earnings are expected to grow by 9.5% yearly, however this is not considered high growth (20% yearly).

Fortum Oyj's revenue growth is positive but not above the Finland market average.

Fortum Oyj's earnings growth is positive but not above the Finland market average.

Fortum Oyj's earnings growth is expected to exceed the low risk savings rate of 0.5%.


Earnings per Share Growth Estimates


Future Return on Equity

Fortum Oyj is not expected to efficiently use shareholders’ funds in the future (Return on Equity less than 20%).


Next Steps

Past Performance

How has Fortum Oyj performed over the past 5 years?

7.2%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

Fortum Oyj's year on year earnings growth rate has been positive over the past 5 years.

Fortum Oyj's 1-year earnings growth is negative, it can't be compared to the 5-year average.

Fortum Oyj's 1-year earnings growth is negative, it can't be compared to the Europe Electric Utilities industry average.


Return on Equity

Fortum Oyj has not efficiently used shareholders’ funds last year (Return on Equity less than 20%).


Return on Assets

Fortum Oyj used its assets more efficiently than the Europe Electric Utilities industry average last year based on Return on Assets.


Return on Capital Employed

Fortum Oyj has significantly improved its use of capital last year versus 3 years ago (Return on Capital Employed).


Next Steps

Financial Health

How is Fortum Oyj's financial position?


Financial Position Analysis

Fortum Oyj is able to meet its short term (1 year) commitments with its holdings of cash and other short term assets.

Fortum Oyj's long term commitments exceed its cash and other short term assets.


Debt to Equity History and Analysis

Fortum Oyj's level of debt (54.1%) compared to net worth is high (greater than 40%).

The level of debt compared to net worth has been reduced over the past 5 years (64.1% vs 54.1% today).

Debt is well covered by operating cash flow (24.3%, greater than 20% of total debt).

Interest payments on debt are well covered by earnings (EBIT is 8.7x coverage).


Balance Sheet

High level of physical assets or inventory.

Debt is not covered by short term assets, assets are 0.5x debt.


Next Steps

Dividend

What is Fortum Oyj's current dividend yield, its reliability and sustainability?

5.51%

Expected Dividend Yield


Dividend Yield and Payments Analysis

Fortum Oyj's pays a higher dividend yield than the bottom 25% of dividend payers in Finland (2.42%).

Fortum Oyj's dividend is above the markets top 25% of dividend payers in Finland (5.3%).

Dividends per share have been stable in the past 10 years.

Dividends per share have increased over the past 10 years.


Current Payout to Shareholders

Dividends paid are covered by earnings (1.2x coverage).


Future Payout to Shareholders

Dividends after 3 years are expected to be covered by earnings (1.5x coverage).


Next Steps

Management

What is the CEO of Fortum Oyj's salary, the management and board of directors tenure and is there insider trading?

3.6yrs

Average management tenure


CEO

Pekka Lundmark (56yo)

3.9yrs

Tenure

€2,111,000

Compensation

Mr. Pekka Ilmari Lundmark, M.Sc.(Eng.), has been President and Chief Executive Officer of Fortum Oyj since September 7, 2015 and serves as its Managing Director. Mr. Lundmark served as President and Chief  ...


CEO Compensation Analysis

Pekka's remuneration is higher than average for companies of similar size in Finland.

Pekka's compensation has been consistent with company performance over the past year, both up more than 20%.


Management Age and Tenure

3.6yrs

Average Tenure

53yo

Average Age

The tenure for the Fortum Oyj management team is about average.


Board Age and Tenure

2.0yrs

Average Tenure

61yo

Average Age

The average tenure for the Fortum Oyj board of directors is less than 3 years, this suggests a new board.


Insider Trading

No 3 month open market individual insider trading information.


Ownership Breakdown


Management Team

  • Pekka Lundmark (56yo)

    President

    • Tenure: 3.9yrs
    • Compensation: €2.11m
  • Sirpa-Helena Sormunen (60yo)

    Secretary to the Board & General Counsel

    • Tenure: 4.9yrs
  • Markus Heikki Rauramo (51yo)

    Chief Financial Officer

    • Tenure: 2.4yrs
  • Per Langer (50yo)

    Executive Vice President of City Solutions

    • Tenure: 2.4yrs
  • Ingela Ulfves (53yo)

    Vice President of Investor Relations & Financial Communications

    • Tenure: 0.0yrs
  • Erkki Kari-Koskinen

    Head of Markets

    • Tenure: 0.0yrs
  • Anders Egelrud (54yo)

    Managing Director of Fortum Värme

    • Tenure: 0.0yrs
  • Heli Kurki

    Head of Publicity & Communications

    • Tenure: 0.0yrs
  • Ensio Väisänen

    Head of Corporate Financial Services Unit

    • Tenure: 12.2yrs
  • Risto Penttinen (51yo)

    Senior VP of Strategy

    • Tenure: 3.3yrs

Board Members

  • Kim Ignatius (63yo)

    Independent Non-Executive Director

    • Tenure: 7.3yrs
  • Matti Lievonen (61yo)

    Chairman

    • Tenure: 1.4yrs
  • Silvennoinen McAlister (59yo)

    Independent Non-Executive Director

    • Tenure: 2.6yrs
  • Klaus-Dieter Maubach (57yo)

    Deputy Chairman

    • Tenure: 1.4yrs
  • Veli-Matti Reinikkala (62yo)

    Independent Non-Executive Director

    • Tenure: 3.3yrs
  • Essimari Kairisto (53yo)

    Director

    • Tenure: 1.4yrs
  • Eva Hamilton (65yo)

    Independent Non-Executive Director

    • Tenure: 4.4yrs
  • Philipp Rösler

    Director

    • Tenure: 0.4yrs

Company Information

Fortum Oyj's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Fortum Oyj
  • Ticker: FORTUM
  • Exchange: HLSE
  • Founded: 1998
  • Industry: Electric Utilities
  • Sector: Utilities
  • Market Cap: €18.112b
  • Shares outstanding: 888.29m
  • Website: https://www.fortum.com

Number of Employees


Location

  • Fortum Oyj
  • CD Building
  • Keilalahdentie 2-4
  • Espoo
  • Uusimaa
  • 2150
  • Finland

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
FOJC.FOTCPK (Pink Sheets LLC)YesRegistered SharesUSUSDDec 1998
FORTUMHLSE (OMX Nordic Exchange Helsinki)YesRegistered SharesFIEURDec 1998
0HAHLSE (London Stock Exchange)YesRegistered SharesGBEURDec 1998
FOTDB (Deutsche Boerse AG)YesRegistered SharesDEEURDec 1998
FOTXTRA (XETRA Trading Platform)YesRegistered SharesDEEURDec 1998
FOJC.YOTCPK (Pink Sheets LLC)ADRUSUSDOct 2008

Biography

Fortum Oyj, together with its subsidiaries, engages in the generation and sale of electricity and heat in the Nordic countries, Russia, Poland, India, other parts of the Baltic Rim area, and internationall ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/08/21 20:35
End of Day Share Price2019/08/21 00:00
Earnings2019/06/30
Annual Earnings2018/12/31


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.