ELECTRONIC ARTS INC (1EA.MI) Stock Fundamental Analysis
BIT:1EA - Borsa Italiana Milan - US2855121099 - Common Stock - Currency: EUR
Taking everything into account, 1EA scores 6 out of 10 in our fundamental rating. 1EA was compared to 44 industry peers in the Entertainment industry. 1EA gets an excellent profitability rating and is at the same time showing great financial health properties. 1EA has a valuation in line with the averages, but it does not seem to be growing.
1. Profitability
1.1 Basic Checks
1EA had positive earnings in the past year.
1EA had a positive operating cash flow in the past year.
In the past 5 years 1EA has always been profitable.
In the past 5 years 1EA always reported a positive cash flow from operatings.
1.2 Ratios
1EA's Return On Assets of 7.96% is amongst the best of the industry. 1EA outperforms 87.50% of its industry peers.
With a decent Return On Equity value of 14.12%, 1EA is doing good in the industry, outperforming 65.00% of the companies in the same industry.
The Return On Invested Capital of 1EA (10.39%) is better than 75.00% of its industry peers.
The Average Return On Invested Capital over the past 3 years for 1EA is in line with the industry average of 8.82%.
The last Return On Invested Capital (10.39%) for 1EA is above the 3 year average (9.83%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.96% | ||
| ROE | 14.12% | ||
| ROIC | 10.39% |
ROA(3y)7.05%
ROA(5y)10.96%
ROE(3y)12.76%
ROE(5y)17.94%
ROIC(3y)9.83%
ROIC(5y)9.75%
1.3 Margins
The Profit Margin of 1EA (14.12%) is better than 85.00% of its industry peers.
1EA's Profit Margin has declined in the last couple of years.
With an excellent Operating Margin value of 20.64%, 1EA belongs to the best of the industry, outperforming 92.50% of the companies in the same industry.
In the last couple of years the Operating Margin of 1EA has remained more or less at the same level.
The Gross Margin of 1EA (78.57%) is better than 67.50% of its industry peers.
In the last couple of years the Gross Margin of 1EA has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 20.64% | ||
| PM (TTM) | 14.12% | ||
| GM | 78.57% |
OM growth 3Y5.5%
OM growth 5Y1.35%
PM growth 3Y4.22%
PM growth 5Y-3.94%
GM growth 3Y1.85%
GM growth 5Y1.15%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), 1EA is creating some value.
1EA has less shares outstanding than it did 1 year ago.
1EA has less shares outstanding than it did 5 years ago.
1EA has a worse debt/assets ratio than last year.
2.2 Solvency
An Altman-Z score of 5.05 indicates that 1EA is not in any danger for bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 5.05, 1EA belongs to the top of the industry, outperforming 87.50% of the companies in the same industry.
1EA has a debt to FCF ratio of 0.95. This is a very positive value and a sign of high solvency as it would only need 0.95 years to pay back of all of its debts.
1EA has a Debt to FCF ratio of 0.95. This is amongst the best in the industry. 1EA outperforms 95.00% of its industry peers.
A Debt/Equity ratio of 0.25 indicates that 1EA is not too dependend on debt financing.
With a decent Debt to Equity ratio value of 0.25, 1EA is doing good in the industry, outperforming 72.50% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.25 | ||
| Debt/FCF | 0.95 | ||
| Altman-Z | 5.05 |
ROIC/WACC1.18
WACC8.77%
2.3 Liquidity
A Current Ratio of 1.43 indicates that 1EA should not have too much problems paying its short term obligations.
1EA has a Current ratio of 1.43. This is in the better half of the industry: 1EA outperforms 80.00% of its industry peers.
A Quick Ratio of 1.43 indicates that 1EA should not have too much problems paying its short term obligations.
With a decent Quick ratio value of 1.43, 1EA is doing good in the industry, outperforming 80.00% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.43 | ||
| Quick Ratio | 1.43 |
3. Growth
3.1 Past
The earnings per share for 1EA have decreased by -2.51% in the last year.
The Earnings Per Share has been growing by 10.27% on average over the past years. This is quite good.
1EA shows a decrease in Revenue. In the last year, the revenue decreased by -2.42%.
Measured over the past years, 1EA shows a quite strong growth in Revenue. The Revenue has been growing by 8.84% on average per year.
EPS 1Y (TTM)-2.51%
EPS 3Y6.36%
EPS 5Y10.27%
EPS Q2Q%47.26%
Revenue 1Y (TTM)-2.42%
Revenue growth 3Y10.34%
Revenue growth 5Y8.84%
Sales Q2Q%8.62%
3.2 Future
1EA is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 6.64% yearly.
The Revenue is expected to grow by 4.15% on average over the next years.
EPS Next Y14.16%
EPS Next 2Y12.21%
EPS Next 3Y11.83%
EPS Next 5Y6.64%
Revenue Next Year2.14%
Revenue Next 2Y3.98%
Revenue Next 3Y4.75%
Revenue Next 5Y4.15%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 16.63, which indicates a correct valuation of 1EA.
1EA's Price/Earnings ratio is rather cheap when compared to the industry. 1EA is cheaper than 82.50% of the companies in the same industry.
The average S&P500 Price/Earnings ratio is at 28.47. 1EA is valued slightly cheaper when compared to this.
Based on the Price/Forward Earnings ratio of 13.33, the valuation of 1EA can be described as correct.
Based on the Price/Forward Earnings ratio, 1EA is valued a bit cheaper than the industry average as 70.00% of the companies are valued more expensively.
When comparing the Price/Forward Earnings ratio of 1EA to the average of the S&P500 Index (92.74), we can say 1EA is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 16.63 | ||
| Fwd PE | 13.33 |
4.2 Price Multiples
1EA's Enterprise Value to EBITDA ratio is in line with the industry average.
70.00% of the companies in the same industry are more expensive than 1EA, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 15.42 | ||
| EV/EBITDA | 15.02 |
4.3 Compensation for Growth
The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
1EA has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)1.17
PEG (5Y)1.62
EPS Next 2Y12.21%
EPS Next 3Y11.83%
5. Dividend
5.1 Amount
With a yearly dividend of 0.51%, 1EA is not a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 2.26, 1EA pays a bit more dividend than its industry peers.
With a Dividend Yield of 0.51, 1EA pays less dividend than the S&P500 average, which is at 2.28.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.51% |
5.2 History
Dividend Growth(5Y)N/A
Div Incr YearsN/A
Div Non Decr YearsN/A
5.3 Sustainability
1EA pays out 19.41% of its income as dividend. This is a sustainable payout ratio.
DP19.41%
EPS Next 2Y12.21%
EPS Next 3Y11.83%
ELECTRONIC ARTS INC
BIT:1EA (1/27/2025, 7:00:00 PM)
112.56
-44.52 (-28.34%)
Chartmill FA Rating
GICS SectorCommunication Services
GICS IndustryGroupMedia & Entertainment
GICS IndustryEntertainment
Earnings (Last)
Earnings (Next)
Inst Owners98.98%
Inst Owner ChangeN/A
Ins Owners0.18%
Ins Owner ChangeN/A
Market Cap29.52B
Analysts77.84
Price Target154.26 (37.05%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.51% |
Yearly Dividend0.76
Dividend Growth(5Y)N/A
DP19.41%
Div Incr YearsN/A
Div Non Decr YearsN/A
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)12.18%
Min EPS beat(2)3.27%
Max EPS beat(2)21.09%
EPS beat(4)2
Avg EPS beat(4)2.52%
Min EPS beat(4)-12.28%
Max EPS beat(4)21.09%
EPS beat(8)5
Avg EPS beat(8)6.5%
EPS beat(12)7
Avg EPS beat(12)9.31%
EPS beat(16)11
Avg EPS beat(16)10.76%
Revenue beat(2)0
Avg Revenue beat(2)-2.78%
Min Revenue beat(2)-4.61%
Max Revenue beat(2)-0.95%
Revenue beat(4)0
Avg Revenue beat(4)-4.55%
Min Revenue beat(4)-8.76%
Max Revenue beat(4)-0.95%
Revenue beat(8)3
Avg Revenue beat(8)-2.41%
Revenue beat(12)5
Avg Revenue beat(12)-1.25%
Revenue beat(16)7
Avg Revenue beat(16)-2.15%
PT rev (1m)5.32%
PT rev (3m)9.44%
EPS NQ rev (1m)3.3%
EPS NQ rev (3m)3.3%
EPS NY rev (1m)1.32%
EPS NY rev (3m)4.01%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0%
Revenue NY rev (1m)1.12%
Revenue NY rev (3m)2.71%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 16.63 | ||
| Fwd PE | 13.33 | ||
| P/S | 4.12 | ||
| P/FCF | 15.42 | ||
| P/OCF | 13.88 | ||
| P/B | 4.12 | ||
| P/tB | 18.15 | ||
| EV/EBITDA | 15.02 |
EPS(TTM)6.77
EY6.01%
EPS(NY)8.44
Fwd EY7.5%
FCF(TTM)7.3
FCFY6.48%
OCF(TTM)8.11
OCFY7.2%
SpS27.33
BVpS27.33
TBVpS6.2
PEG (NY)1.17
PEG (5Y)1.62
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.96% | ||
| ROE | 14.12% | ||
| ROCE | 14.77% | ||
| ROIC | 10.39% | ||
| ROICexc | 13.81% | ||
| ROICexgc | 52.2% | ||
| OM | 20.64% | ||
| PM (TTM) | 14.12% | ||
| GM | 78.57% | ||
| FCFM | 26.7% |
ROA(3y)7.05%
ROA(5y)10.96%
ROE(3y)12.76%
ROE(5y)17.94%
ROIC(3y)9.83%
ROIC(5y)9.75%
ROICexc(3y)13.97%
ROICexc(5y)19.66%
ROICexgc(3y)86.06%
ROICexgc(5y)96.94%
ROCE(3y)13.99%
ROCE(5y)13.87%
ROICexcg growth 3Y-1.5%
ROICexcg growth 5YN/A
ROICexc growth 3Y-4.05%
ROICexc growth 5Y-22.03%
OM growth 3Y5.5%
OM growth 5Y1.35%
PM growth 3Y4.22%
PM growth 5Y-3.94%
GM growth 3Y1.85%
GM growth 5Y1.15%
F-Score7
Asset Turnover0.56
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.25 | ||
| Debt/FCF | 0.95 | ||
| Debt/EBITDA | 0.96 | ||
| Cap/Depr | 50.81% | ||
| Cap/Sales | 2.97% | ||
| Interest Coverage | 27.3 | ||
| Cash Conversion | 112.03% | ||
| Profit Quality | 189.1% | ||
| Current Ratio | 1.43 | ||
| Quick Ratio | 1.43 | ||
| Altman-Z | 5.05 |
F-Score7
WACC8.77%
ROIC/WACC1.18
Cap/Depr(3y)42.19%
Cap/Depr(5y)57.68%
Cap/Sales(3y)2.7%
Cap/Sales(5y)2.57%
Profit Quality(3y)183.51%
Profit Quality(5y)164.26%
High Growth Momentum
Growth
EPS 1Y (TTM)-2.51%
EPS 3Y6.36%
EPS 5Y10.27%
EPS Q2Q%47.26%
EPS Next Y14.16%
EPS Next 2Y12.21%
EPS Next 3Y11.83%
EPS Next 5Y6.64%
Revenue 1Y (TTM)-2.42%
Revenue growth 3Y10.34%
Revenue growth 5Y8.84%
Sales Q2Q%8.62%
Revenue Next Year2.14%
Revenue Next 2Y3.98%
Revenue Next 3Y4.75%
Revenue Next 5Y4.15%
EBIT growth 1Y0.66%
EBIT growth 3Y16.41%
EBIT growth 5Y10.31%
EBIT Next Year18.61%
EBIT Next 3Y11.87%
EBIT Next 5Y7.88%
FCF growth 1Y25.59%
FCF growth 3Y5.34%
FCF growth 5Y8.18%
OCF growth 1Y22.93%
OCF growth 3Y6.18%
OCF growth 5Y8.4%