Fortum OYJ (FOJCY) AI Stock Analysis

• Market Cap: $20.05B
• Dividend Yield: 10.93%
• Average Volume (3M): 176.00
• Price to Earnings (P/E): 21.7
• Beta (1Y): 0.36
• Revenue Growth: -19.13%
• EPS Growth: -30.28%
• Country: US
• Employees: 4,451
• Sector: Utilities
• Sector Strength: 65
• Industry: Renewable Utilities
• EPS (TTM): 0.01
• Shares Outstanding: 4,486,322,300
• 10 Day Avg. Volume: 72
• 30 Day Avg. Volume: 176
• PEG Ratio: -0.06
• Price to Book (P/B): 1.28
• Price to Sales (P/S): 2.01
• P/FCF Ratio: 12.82
• Enterprise Value/Market Cap: 0.94
• Enterprise Value/Revenue: 3.66
• Enterprise Value/Gross Profit: 9.50
• Enterprise Value/Ebitda: 11.93
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 65 Neutral
• Price Target: $4.50 ▲(7.14% Upside)

Fortum OYJ's overall stock score is driven by its strong valuation, characterized by a high dividend yield and reasonable P/E ratio, which is appealing to investors. Financial performance shows profitability but also highlights challenges in revenue growth and cash flow management. Technical analysis presents a neutral outlook, with mixed signals from momentum indicators. The earnings call provided a balanced view, with achievements in efficiency and power pricing offset by generation volume challenges.

Positive Factors

Efficiency Improvement Program

The efficiency improvement program will enhance cost management and operational efficiency, leading to sustained profitability and competitive advantage.

Renewable Energy Expansion

Expanding the renewable energy portfolio strengthens Fortum's market position in clean energy, aligning with global sustainability trends and increasing future revenue potential.

Consumer Solutions Performance

Strong performance in the Consumer Solutions segment indicates robust demand and effective market strategies, supporting long-term revenue stability.

Negative Factors

Decreased Generation Volumes

Reduced generation volumes in key segments can lead to lower revenue and profitability, posing a risk to financial stability if not addressed.

Cash Flow Challenges

Declining cash flow growth could limit Fortum's ability to invest in new projects and manage debt, affecting long-term financial health.

Revenue Decline

A declining revenue growth trend may indicate challenges in market expansion and competitiveness, potentially impacting future profitability.

Fortum OYJ Business Overview & Revenue Model

Company Description

Fortum OYJ is a leading clean energy company based in Finland, primarily engaged in the generation, distribution, and sale of electricity and heat. The company operates in various segments, including Power Generation, Customer Solutions, and Heat, and is heavily invested in renewable energy sources such as hydro, wind, and solar power. Fortum is dedicated to providing sustainable energy solutions and is actively involved in the transition to a low-carbon economy, offering services that encompass energy storage, electric vehicle charging, and smart energy solutions.

How the Company Makes Money

Fortum OYJ generates revenue through multiple key streams. The primary source is electricity generation, where it produces energy from both renewable and non-renewable sources, selling it to the market. The company also earns income through its Customer Solutions segment, providing electricity, gas, and heating services to both residential and commercial customers. Additionally, Fortum profits from its investments in energy infrastructure, such as district heating and cooling systems. Partnerships with other energy providers and entities engaged in energy efficiency initiatives further enhance its revenue. The company's focus on sustainability and innovation in energy solutions positions it to capitalize on the growing demand for clean energy, thereby creating additional revenue opportunities.

Fortum OYJ Financial Statement Overview

Summary

Fortum OYJ's financial statements present a mixed picture. The company demonstrates strong profitability with healthy margins, but revenue growth has been declining. The balance sheet is stable with moderate leverage, but cash flow metrics indicate potential liquidity challenges. Overall, while the company is profitable, it faces growth and cash flow management challenges that need addressing to ensure long-term financial health.

Income Statement

Fortum OYJ's income statement shows a mixed performance. The TTM data indicates a decline in revenue growth rate by 16.4%, which is concerning. However, the company maintains a solid gross profit margin of 39% and a net profit margin of 17.3%, indicating profitability. EBIT and EBITDA margins are also healthy at 23.6% and 30.1%, respectively. Despite the revenue decline, the company has managed to maintain strong profitability metrics.

Balance Sheet

The balance sheet reflects a stable financial position with a debt-to-equity ratio of 0.59, indicating moderate leverage. The return on equity is 9.9%, which is reasonable but shows a decline from previous years. The equity ratio stands at 50.9%, suggesting a solid equity base relative to total assets. Overall, the balance sheet indicates a stable but slightly leveraged financial structure.

Cash Flow

Cash flow analysis reveals challenges, with a significant decline in free cash flow growth rate by 26.9% in the TTM period. The operating cash flow to net income ratio is 0.44, indicating that operating cash flow covers less than half of net income, which could be improved. The free cash flow to net income ratio is 0.52, showing that free cash flow is over half of net income, but the declining trend is a concern.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	5.14B	5.80B	6.71B	8.80B	112.40B	49.02B
Gross Profit	1.98B	2.40B	2.90B	3.33B	7.23B	4.72B
EBITDA	1.58B	2.04B	2.21B	2.46B	4.82B	3.50B
Net Income	871.76M	1.16B	-2.07B	1.01B	-114.00M	1.82B
Balance Sheet
Total Assets	18.65B	17.31B	18.74B	23.64B	149.66B	57.81B
Cash, Cash Equivalents and Short-Term Investments	3.63B	4.13B	4.18B	3.92B	7.59B	2.31B
Total Debt	5.64B	4.83B	5.91B	7.84B	17.22B	10.66B
Total Liabilities	9.05B	8.15B	10.24B	15.90B	136.00B	42.23B
Stockholders Equity	9.50B	9.07B	8.44B	7.67B	12.13B	12.95B
Cash Flow
Free Cash Flow	483.28M	909.00M	1.24B	-9.30B	3.79B	1.45B
Operating Cash Flow	996.53M	1.39B	1.82B	-8.77B	4.97B	2.56B
Investing Cash Flow	330.21M	604.00M	1.10B	-985.00M	-5.73B	-2.14B
Financing Cash Flow	-2.54B	-2.04B	-2.61B	6.07B	6.01B	505.00M

Fortum OYJ Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 4.20
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For FOJCY, the sentiment is Positive. The current price of 4.2 is below the 20-day moving average (MA) of 4.33, below the 50-day MA of 4.31, and above the 200-day MA of 3.76, indicating a bullish trend. The MACD of 0.07 indicates Negative momentum. The RSI at 64.90 is Neutral, neither overbought nor oversold. The STOCH value of 92.90 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for FOJCY.

Fortum OYJ Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
GEV	70 Outperform	$174.78B	104.39	18.78%	0.14%	9.43%	35.56%
CWEN.A	70 Neutral	$6.68B	13.31	13.20%	5.60%	2.54%	124.89%
Sector *	66 Neutral	$17.65B	18.10	5.60%	3.62%	6.62%	11.55%
FOJCY	65 Neutral	$20.05B	21.71	10.78%	10.93%	-19.13%	-30.28%
CWEN	63 Neutral	$6.68B	14.17	13.20%	5.29%	2.54%	124.89%
CEG	63 Neutral	$103.17B	37.83	20.35%	0.43%	21.35%	-3.93%
BEPC	51 Neutral	$6.96B	-5.80	-38.17%	3.84%	5.93%	-39.88%