Contact Energy
Market Cap
NZ$6.2b
Last Updated
2021/06/24 07:00 UTC
Data Sources
Company Financials +
Executive Summary
Contact Energy Limited generates and sells electricity and natural gas in New Zealand. More Details
Rewards
Risk Analysis
Dividend of 4.61% is not well covered by earnings or forecast to be in the next 3 years
Snowflake Analysis
Proven track record with mediocre balance sheet.
Similar Companies
Share Price & News
How has Contact Energy's share price performed over time and what events caused price changes?
Latest Share Price and Events
Stable Share Price: CEN is not significantly more volatile than the rest of NZ stocks over the past 3 months, typically moving +/- 3% a week.
Volatility Over Time: CEN's weekly volatility (3%) has been stable over the past year.
Market Performance
7 Day Return
-1.5%
CEN
0.08%
NZ Electric Utilities
0.4%
NZ Market
1 Year Return
30.4%
CEN
33.7%
NZ Electric Utilities
12.2%
NZ Market
Return vs Industry: CEN underperformed the NZ Electric Utilities industry which returned 33.7% over the past year.
Return vs Market: CEN exceeded the NZ Market which returned 12.2% over the past year.
Shareholder returns
| CEN | Industry | Market | |
|---|---|---|---|
| 7 Day | -1.5% | 0.08% | 0.4% |
| 30 Day | 5.0% | -0.2% | 1.1% |
| 90 Day | 18.8% | 5.5% | -0.3% |
| 1 Year | 38.8%30.4% | 40.0%33.7% | 15.3%12.2% |
| 3 Year | 65.3%36.6% | 98.1%68.0% | 37.2%20.6% |
| 5 Year | 111.3%55.0% | 60.6%27.7% | 79.8%38.2% |
Long-Term Price Volatility Vs. Market
How volatile is Contact Energy's share price compared to the market and industry in the last 5 years?
Simply Wall St News
18 hours ago | Simply Wall St
Contact Energy (NZSE:CEN) Has Gifted Shareholders With A Fantastic 111% Total Return On Their Investment1 month ago | Simply Wall St
Contact Energy Limited's (NZSE:CEN) Financials Are Too Obscure To Link With Current Share Price Momentum: What's In Store For the Stock?1 month ago | Simply Wall St
Is Contact Energy Limited (NZSE:CEN) Trading At A 27% Discount?Valuation
Is Contact Energy undervalued compared to its fair value and its price relative to the market?
35.9%
Undervalued compared to fair value
Share Price vs. Fair Value
Below Fair Value: CEN (NZ$8.03) is trading below our estimate of fair value (NZ$12.52)
Significantly Below Fair Value: CEN is trading below fair value by more than 20%.
Price To Earnings Ratio
PE vs Industry: CEN is poor value based on its PE Ratio (40.2x) compared to the Oceanic Electric Utilities industry average (37.5x).
PE vs Market: CEN is poor value based on its PE Ratio (40.2x) compared to the NZ market (22.5x).
Price to Earnings Growth Ratio
PEG Ratio: CEN is poor value based on its PEG Ratio (10.1x)
Price to Book Ratio
PB vs Industry: CEN's PB Ratio (2.3x) is in line with the NZ Electric Utilities industry average.
Future Growth
How is Contact Energy forecast to perform in the next 1 to 3 years based on estimates from 6 analysts?
4.0%
Forecasted annual earnings growth
Earnings and Revenue Growth Forecasts
Analyst Future Growth Forecasts
Earnings vs Savings Rate: CEN's forecast earnings growth (4% per year) is above the savings rate (2.1%).
Earnings vs Market: CEN's earnings (4% per year) are forecast to grow slower than the NZ market (12.7% per year).
High Growth Earnings: CEN's earnings are forecast to grow, but not significantly.
Revenue vs Market: CEN's revenue is expected to decline over the next 3 years (-4.6% per year).
High Growth Revenue: CEN's revenue is forecast to decline over the next 3 years (-4.6% per year).
Earnings per Share Growth Forecasts
Future Return on Equity
Future ROE: CEN's Return on Equity is forecast to be low in 3 years time (6.6%).
Past Performance
How has Contact Energy performed over the past 5 years?
26.7%
Historical annual earnings growth
Earnings and Revenue History
Quality Earnings: CEN has high quality earnings.
Growing Profit Margin: CEN's current net profit margins (6.8%) are higher than last year (5.7%).
Past Earnings Growth Analysis
Earnings Trend: CEN has become profitable over the past 5 years, growing earnings by 26.7% per year.
Accelerating Growth: CEN's earnings growth over the past year (10.8%) is below its 5-year average (26.7% per year).
Earnings vs Industry: CEN earnings growth over the past year (10.8%) exceeded the Electric Utilities industry 7.4%.
Return on Equity
High ROE: CEN's Return on Equity (5.7%) is considered low.
Financial Health
How is Contact Energy's financial position?
Financial Position Analysis
Short Term Liabilities: CEN's short term assets (NZ$288.0M) do not cover its short term liabilities (NZ$533.0M).
Long Term Liabilities: CEN's short term assets (NZ$288.0M) do not cover its long term liabilities (NZ$1.7B).
Debt to Equity History and Analysis
Debt Level: CEN's debt to equity ratio (44.1%) is considered high.
Reducing Debt: CEN's debt to equity ratio has reduced from 61.1% to 44.1% over the past 5 years.
Debt Coverage: CEN's debt is well covered by operating cash flow (34.3%).
Interest Coverage: CEN's interest payments on its debt are well covered by EBIT (5.3x coverage).
Balance Sheet
Dividend
What is Contact Energy current dividend yield, its reliability and sustainability?
4.61%
Current Dividend Yield
Dividend Yield vs Market
Notable Dividend: CEN's dividend (4.61%) is higher than the bottom 25% of dividend payers in the NZ market (2.33%).
High Dividend: CEN's dividend (4.61%) is low compared to the top 25% of dividend payers in the NZ market (4.62%).
Stability and Growth of Payments
Stable Dividend: CEN's dividends per share have been stable in the past 10 years.
Growing Dividend: CEN's dividend payments have increased over the past 10 years.
Current Payout to Shareholders
Dividend Coverage: With its high payout ratio (185%), CEN's dividend payments are not well covered by earnings.
Future Payout to Shareholders
Future Dividend Coverage: CEN's dividends in 3 years are not forecast to be well covered by earnings (158.4% payout ratio).
Next Steps
Management
How experienced are the management team and are they aligned to shareholders interests?
2.0yrs
Average management tenure
CEO
Mike Fuge
1.33yrs
Tenure
NZ$1,365,923
Compensation
Mr. Michael Fuge, also known as Mike, M. Com. (Hons), B.Eng. (Hons), MIPENZ, serves as Chief Executive Officer of Contact Energy Limited since February 24, 2020. He served as Chief Executive Officer at The...
CEO Compensation Analysis
Compensation vs Market: Mike's total compensation ($USD963.00K) is below average for companies of similar size in the NZ market ($USD1.43M).
Compensation vs Earnings: Insufficient data to compare Mike's compensation with company performance.
Leadership Team
Experienced Management: CEN's management team is considered experienced (2 years average tenure).
Board Members
Experienced Board: CEN's board of directors are not considered experienced ( 2.8 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: CEN insiders have sold more shares than they have bought in the past 3 months.
Recent Insider Transactions
Ownership Breakdown
Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 8.1%.
Top Shareholders
Company Information
Contact Energy Limited's company bio, employee growth, exchange listings and data sources
Key Information
- Name: Contact Energy Limited
- Ticker: CEN
- Exchange: NZSE
- Founded: 1995
- Industry: Electric Utilities
- Sector: Utilities
- Market Cap: NZ$6.232b
- Shares outstanding: 776.12m
- Website: https://contact.co.nz
Number of Employees
Location
- Contact Energy Limited
- Harbour City Tower
- 29 Brandon Street
- Wellington
- 6011
- New Zealand
Listings
Biography
Contact Energy Limited generates and sells electricity and natural gas in New Zealand. The company operates through two segments, Wholesale and Customer. The Wholesale segment sells electricity to the whol...
Company Analysis and Financial Data Status
| Data | Last Updated (UTC time) |
|---|---|
| Company Analysis | 2021/06/24 07:00 |
| End of Day Share Price | 2021/06/23 00:00 |
| Earnings | 2020/12/31 |
| Annual Earnings | 2020/06/30 |
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.