NYSE:ES

Stock Analysis Report

Executive Summary

Eversource Energy, a public utility holding company, engages in the energy delivery business.

Rewards

Trading at 29.4% below its fair value

Earnings are forecast to grow 9.71% per year

Pays a high and reliable dividend of 2.49%

Risk Analysis

Debt is not well covered by operating cash flow



Snowflake Analysis

Established dividend payer and slightly overvalued.


Similar Companies

Share Price & News

How has Eversource Energy's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: ES has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

5.1%

ES

4.0%

US Electric Utilities

2.0%

US Market


1 Year Return

31.1%

ES

27.2%

US Electric Utilities

23.5%

US Market

Return vs Industry: ES exceeded the US Electric Utilities industry which returned 24.9% over the past year.

Return vs Market: ES exceeded the US Market which returned 24.7% over the past year.


Shareholder returns

ESIndustryMarket
7 Day5.1%4.0%2.0%
30 Day6.1%4.3%4.3%
90 Day3.7%5.9%12.2%
1 Year34.8%31.1%31.5%27.2%26.1%23.5%
3 Year76.8%61.3%53.0%37.9%53.1%43.2%
5 Year86.2%58.9%62.4%35.0%75.5%56.1%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

Is Eversource Energy undervalued compared to its fair value and its price relative to the market?

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: ES ($85.85) is trading below our estimate of fair value ($121.57)

Significantly Below Fair Value: ES is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: ES is poor value based on its PE Ratio (30.8x) compared to the Electric Utilities industry average (25x).

PE vs Market: ES is poor value based on its PE Ratio (30.8x) compared to the US market (18.9x).


Price to Earnings Growth Ratio

PEG Ratio: ES is poor value based on its PEG Ratio (3.2x)


Price to Book Ratio

PB vs Industry: ES is overvalued based on its PB Ratio (2.3x) compared to the US Electric Utilities industry average (2.3x).


Next Steps

Future Growth

How is Eversource Energy forecast to perform in the next 1 to 3 years based on estimates from 11 analysts?

9.6%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: ES's forecast earnings growth (9.7% per year) is above the savings rate (1.7%).

Earnings vs Market: ES's earnings (9.7% per year) are forecast to grow slower than the US market (14.3% per year).

High Growth Earnings: ES's earnings are forecast to grow, but not significantly.

Revenue vs Market: ES's revenue (4.6% per year) is forecast to grow slower than the US market (7.5% per year).

High Growth Revenue: ES's revenue (4.6% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: ES's Return on Equity is forecast to be low in 3 years time (9.4%).


Next Steps

Past Performance

How has Eversource Energy performed over the past 5 years?

3.7%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: ES has high quality earnings.

Growing Profit Margin: ES's current net profit margins (10.5%) are lower than last year (12.5%).


Past Earnings Growth Analysis

Earnings Trend: ES's earnings have grown by 3.7% per year over the past 5 years.

Accelerating Growth: ES's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: ES had negative earnings growth (-14.3%) over the past year, making it difficult to compare to the Electric Utilities industry average (2%).


Return on Equity

High ROE: ES's Return on Equity (7.3%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Eversource Energy's financial position?


Financial Position Analysis

Short Term Liabilities: ES's short term assets ($2.2B) do not cover its short term liabilities ($3.7B).

Long Term Liabilities: ES's short term assets ($2.2B) do not cover its long term liabilities ($23.7B).


Debt to Equity History and Analysis

Debt Level: ES's debt to equity ratio (127%) is considered high.

Reducing Debt: ES's debt to equity ratio has increased from 94% to 127% over the past 5 years.

Debt Coverage: ES's debt is not well covered by operating cash flow (12%).

Interest Coverage: ES's interest payments on its debt are well covered by EBIT (3.6x coverage).


Balance Sheet

Inventory Level: ES has a high level of physical assets or inventory.

Debt Coverage by Assets: ES's debt is not covered by short term assets (assets are 0.1x debt).


Next Steps

Dividend

What is Eversource Energy's current dividend yield, its reliability and sustainability?

2.41%

Current Dividend Yield


Dividend Yield vs Market

company2.4%marketbottom25%1.4%markettop25%3.7%industryaverage3.0%forecastin3Years2.7%

Current dividend yield vs market & industry

Notable Dividend: ES's dividend (2.49%) is higher than the bottom 25% of dividend payers in the US market (1.4%).

High Dividend: ES's dividend (2.49%) is low compared to the top 25% of dividend payers in the US market (3.66%).


Stability and Growth of Payments

Stable Dividend: ES's dividends per share have been stable in the past 10 years.

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


Current Payout to Shareholders

Dividend Coverage: At its current payout ratio (75.8%), ES's payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: ES's dividends in 3 years are forecast to be covered by earnings (62.3% payout ratio).


Next Steps

Management

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

5.3yrs

Average management tenure


CEO

Jim Judge (63yo)

3.8yrs

Tenure

US$14,925,381

Compensation

Mr. James J. Judge, also known as Jim, has been the Chief Executive Officer and President of Eversource Energy (formerly, Northeast Utilities/Northeast Utilities System) since May 4, 2016. Mr. Judge served ...


CEO Compensation Analysis

Compensation vs Market: Jim's total compensation ($USD14.93M) is above average for companies of similar size in the US market ($USD10.76M).

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


Management Age and Tenure

5.3yrs

Average Tenure

61yo

Average Age

Experienced Management: ES's management team is seasoned and experienced (5.3 years average tenure).


Board Age and Tenure

7.8yrs

Average Tenure

68.5yo

Average Age

Experienced Board: ES's board of directors are considered experienced (7.8 years average tenure).


Insider Trading

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

SellUS$99,99028 Aug 19
Philip Lembo
EntityIndividual
Role
Chief Financial Officer
Executive VP & CFO
Shares1,256
Max PriceUS$79.61
SellUS$641,43506 Aug 19
Gregory Butler
EntityIndividual
Role
Chief Legal Officer
Executive VP & General Counsel
Shares8,298
Max PriceUS$77.30
SellUS$510,66115 May 19
Leon Olivier
EntityIndividual
Role
Senior Key Executive
Executive Vice President of Enterprise Energy Strategy & Business Development
Shares7,000
Max PriceUS$72.95
SellUS$789,23907 Mar 19
Gregory Butler
EntityIndividual
Role
Chief Legal Officer
Executive VP & General Counsel
Shares11,500
Max PriceUS$68.63
SellUS$71,76305 Mar 19
Sanford Cloud
EntityIndividual
Role
Lead Director
Lead Trustee
Shares1,042
Max PriceUS$68.87
SellUS$5,525,80627 Feb 19
James Judge
EntityIndividual
Role
Chief Executive Officer
Chairman
Shares79,508
Max PriceUS$69.50
SellUS$114,56926 Feb 19
Jay Buth
EntityIndividual
Role
Chief Accounting Officer
VP, Controller & Chief Accounting Officer
Shares1,650
Max PriceUS$69.44
SellUS$176,22825 Feb 19
Frederica Williams
EntityIndividual
Role
Member of the Board of Directors
Shares2,501
Max PriceUS$70.46
SellUS$175,07025 Feb 19
William Van Fassen
EntityIndividual
Role
Member of the Board of Directors
Shares2,501
Max PriceUS$70.00
SellUS$503,23325 Feb 19
Joseph Nolan
EntityIndividual
Shares7,191
Max PriceUS$69.98
SellUS$1,050,91525 Feb 19
Christine Carmody
EntityIndividual
Role
Head of Human Resources
Executive Vice President of Human Resources & Information Technology
Shares15,000
Max PriceUS$70.06

Ownership Breakdown

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


Management Team

  • Jim Judge (63yo)

    Chairman

    • Tenure: 3.8yrs
    • Compensation: US$14.93m
  • Jeff Kotkin

    Vice President of Investor Relations

    • Tenure: 18.6yrs
  • Lee Olivier (71yo)

    Executive Vice President of Enterprise Energy Strategy & Business Development

    • Tenure: 14.1yrs
    • Compensation: US$2.84m
  • Werner Schweiger (60yo)

    Executive VP & COO

    • Tenure: 5.3yrs
    • Compensation: US$3.31m
  • Greg Butler (61yo)

    Executive VP & General Counsel

    • Tenure: 14.1yrs
    • Compensation: US$2.88m
  • Jay Buth (49yo)

    VP, Controller & Chief Accounting Officer

    • Tenure: 7.8yrs
  • Chris Carmody (56yo)

    Executive Vice President of Human Resources & Information Technology

    • Tenure: 3.4yrs
  • Phil Lembo (63yo)

    Executive VP & CFO

    • Tenure: 2.7yrs
    • Compensation: US$4.20m
  • Jim Hunt

    Chief Communications Officer & Senior VP for Regulatory Affairs

    • Tenure: 3.3yrs
  • Duncan MacKay

    Chief Compliance Officer & Deputy General Counsel


    Board Members

    • Jim Judge (63yo)

      Chairman

      • Tenure: 3.8yrs
      • Compensation: US$14.93m
    • Sanford Cloud (74yo)

      Lead Trustee

      • Tenure: 7.8yrs
      • Compensation: US$292.57k
    • Cotton Cleveland (67yo)

      • Tenure: 28yrs
      • Compensation: US$247.57k
    • Bill Van Fassen (71yo)

      • Tenure: 7.8yrs
      • Compensation: US$259.07k
    • John Kim (59yo)

      • Tenure: 2yrs
      • Compensation: US$247.57k
    • Jim DiStasio (72yo)

      • Tenure: 7.8yrs
      • Compensation: US$262.57k
    • Francis Doyle (71yo)

      • Tenure: 7.8yrs
      • Compensation: US$267.57k
    • Ken Leibler (70yo)

      • Tenure: 13.2yrs
      • Compensation: US$247.57k
    • Frederica Williams (61yo)

      • Tenure: 7.8yrs
      • Compensation: US$247.57k
    • Linda Forry (45yo)

      • Tenure: 1.7yrs
      • Compensation: US$218.82k

    Company Information

    Eversource Energy's company bio, employee growth, exchange listings and data sources


    Key Information

    • Name: Eversource Energy
    • Ticker: ES
    • Exchange: NYSE
    • Founded: 1927
    • Industry: Electric Utilities
    • Sector: Utilities
    • Market Cap: US$28.413b
    • Shares outstanding: 323.76m
    • Website: https://www.eversource.com

    Number of Employees


    Location

    • Eversource Energy
    • 300 Cadwell Drive
    • Springfield
    • Massachusetts
    • 1104
    • United States

    Listings

    TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
    ESNYSE (New York Stock Exchange)YesCommon SharesUSUSDJan 1968
    NWJDB (Deutsche Boerse AG)YesCommon SharesDEEURJan 1968
    0IJ2LSE (London Stock Exchange)YesCommon SharesGBUSDJan 1968
    NWJETLX (Eurotlx)YesCommon SharesITEURJan 1968

    Biography

    Eversource Energy, a public utility holding company, engages in the energy delivery business. The company operates in four segments: Electric Distribution, Electric Transmission, Natural Gas Distribution, and Water Distribution. It is involved in the transmission and distribution of electricity; and distribution of natural gas. The company operates water regulated utilities. It also provides water services to approximately 228,000 customers. It serves residential, commercial, industrial, municipal, fire protection, and other customers in Connecticut, Massachusetts, and New Hampshire, the United States. The company was formerly known as Northeast Utilities and changed its name to Eversource Energy in April 2015. Eversource Energy was founded in 1927 and is based in Springfield, Massachusetts. 


    Company Analysis and Financial Data Status

    All financial data provided by Standard & Poor's Capital IQ.
    DataLast Updated (UTC time)
    Company Analysis2020/01/17 23:41
    End of Day Share Price2020/01/17 00:00
    Earnings2019/09/30
    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.