$H&E Equipment Services (HEES.US)$In the past 5 years, it fi...
$H&E Equipment Services(HEES.US$In the past 5 years, it first grew by 1 year, then declined for 2 years, then grew rapidly for another 2 years. The year with the worst performance in 2020 incidentally involved high capital asset impairment and other special expenses, causing losses that year. Revenue, operating profit, and net profit increased by 17.1%, 69.6%, and 28.9% respectively in 2022. Mainly, operating profit increased sharply due to a sharp increase in gross margin, while profit from cessation of operations in 2021 caused the starting point of net profit to be too high, so the growth rate in '22 was slow. Operating profit in '22 was 3.9 times interest expenses, which is not an easy burden.
In the first two quarters of 2023, revenue increased by 20.4%, operating profit increased by 38.8%, and net profit increased by 57%.
The balance sheet shows that in the past 5 years, debt first rose and then fell, from 85.1% to 88% and then fell to 82.5%. In 2023Q2, it was 82.4%. The ratio and growth rate of receivables and inventory seem to be quite normal. Inventory increased sharply by 88 million in the last two quarters. This may be the result of seasonal effects compounded by rapid revenue growth. Net profit for the same period was only 67 million dollars, with no gold content.
Goodwill and other intangible assets are $132 million, accounting for 29.3% of net assets of 450 million yuan, and long-term loans of $1,372 million. The leverage ratio is very high.
The cumulative net cash flow operating amount over the past five years has been lower than the net investment amount, and no shareholder surplus has been generated.
Currently, the price-earnings ratio is 12.8, and the price-earnings ratio TTM has dropped to 10.8. If we calculate the 5-year average net profit of 70 million, the price-earnings ratio is 24. Overall, it is not very attractive.
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