ESSILORLUXOTTICA (1EL.MI) Stock Fundamental Analysis
Europe - Euronext Milan - BIT:1EL - FR0000121667 - Common Stock
265.3 EUR
-4.7 (-1.74%)
We assign a fundamental rating of 4 out of 10 to 1EL. 1EL was compared to 63 industry peers in the Health Care Equipment & Supplies industry. There are concerns on the financial health of 1EL while its profitability can be described as average. 1EL is quite expensive at the moment. It does show a decent growth rate.
1. Profitability
1.1 Basic Checks
- In the past year 1EL was profitable.
- 1EL had a positive operating cash flow in the past year.
- 1EL had positive earnings in each of the past 5 years.
- Each year in the past 5 years 1EL had a positive operating cash flow.
1.2 Ratios
- 1EL has a Return On Assets (3.84%) which is in line with its industry peers.
- Looking at the Return On Equity, with a value of 6.29%, 1EL is in line with its industry, outperforming 49.21% of the companies in the same industry.
- 1EL has a Return On Invested Capital (5.39%) which is in line with its industry peers.
- The Average Return On Invested Capital over the past 3 years for 1EL is significantly below the industry average of 9.95%.
- The 3 year average ROIC (4.84%) for 1EL is below the current ROIC(5.39%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.84% | ||
| ROE | 6.29% | ||
| ROIC | 5.39% |
ROA(3y)3.67%
ROA(5y)2.72%
ROE(3y)5.86%
ROE(5y)4.39%
ROIC(3y)4.84%
ROIC(5y)3.74%
1.3 Margins
- With a decent Profit Margin value of 8.74%, 1EL is doing good in the industry, outperforming 61.90% of the companies in the same industry.
- 1EL's Profit Margin has improved in the last couple of years.
- The Operating Margin of 1EL (12.86%) is comparable to the rest of the industry.
- 1EL's Operating Margin has improved in the last couple of years.
- 1EL has a better Gross Margin (61.91%) than 63.49% of its industry peers.
- In the last couple of years the Gross Margin of 1EL has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 12.86% | ||
| PM (TTM) | 8.74% | ||
| GM | 61.91% |
OM growth 3Y4.69%
OM growth 5Y6.47%
PM growth 3Y6.8%
PM growth 5Y7.52%
GM growth 3Y0.88%
GM growth 5Y0.39%
2. Health
2.1 Basic Checks
- With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), 1EL is destroying value.
- Compared to 1 year ago, 1EL has more shares outstanding
- The number of shares outstanding for 1EL has been increased compared to 5 years ago.
- Compared to 1 year ago, 1EL has a worse debt to assets ratio.
2.2 Solvency
- An Altman-Z score of 4.03 indicates that 1EL is not in any danger for bankruptcy at the moment.
- 1EL has a better Altman-Z score (4.03) than 69.84% of its industry peers.
- 1EL has a debt to FCF ratio of 4.18. This is a neutral value as 1EL would need 4.18 years to pay back of all of its debts.
- Looking at the Debt to FCF ratio, with a value of 4.18, 1EL is in the better half of the industry, outperforming 63.49% of the companies in the same industry.
- 1EL has a Debt/Equity ratio of 0.25. This is a healthy value indicating a solid balance between debt and equity.
- 1EL has a Debt to Equity ratio of 0.25. This is in the better half of the industry: 1EL outperforms 65.08% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.25 | ||
| Debt/FCF | 4.18 | ||
| Altman-Z | 4.03 |
ROIC/WACC0.69
WACC7.8%
2.3 Liquidity
- 1EL has a Current Ratio of 0.97. This is a bad value and indicates that 1EL is not financially healthy enough and could expect problems in meeting its short term obligations.
- 1EL's Current ratio of 0.97 is on the low side compared to the rest of the industry. 1EL is outperformed by 79.37% of its industry peers.
- A Quick Ratio of 0.67 indicates that 1EL may have some problems paying its short term obligations.
- 1EL's Quick ratio of 0.67 is on the low side compared to the rest of the industry. 1EL is outperformed by 74.60% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.97 | ||
| Quick Ratio | 0.67 |
3. Growth
3.1 Past
- The Earnings Per Share has been growing slightly by 3.00% over the past year.
- Measured over the past years, 1EL shows a quite strong growth in Earnings Per Share. The EPS has been growing by 16.01% on average per year.
- The Revenue has been growing slightly by 5.45% in the past year.
- 1EL shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 8.80% yearly.
EPS 1Y (TTM)3%
EPS 3Y13.7%
EPS 5Y16.01%
EPS Q2Q%2.1%
Revenue 1Y (TTM)5.45%
Revenue growth 3Y10.18%
Revenue growth 5Y8.8%
Sales Q2Q%5.52%
3.2 Future
- Based on estimates for the next years, 1EL will show a quite strong growth in Earnings Per Share. The EPS will grow by 9.60% on average per year.
- 1EL is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 7.56% yearly.
EPS Next Y5.69%
EPS Next 2Y8.8%
EPS Next 3Y10.77%
EPS Next 5Y9.6%
Revenue Next Year5.99%
Revenue Next 2Y6.94%
Revenue Next 3Y7.45%
Revenue Next 5Y7.56%
3.3 Evolution
- The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
- When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
4. Valuation
4.1 Price/Earnings Ratio
- The Price/Earnings ratio is 38.62, which means the current valuation is very expensive for 1EL.
- 1EL's Price/Earnings is on the same level as the industry average.
- 1EL is valuated rather expensively when we compare the Price/Earnings ratio to 27.21, which is the current average of the S&P500 Index.
- A Price/Forward Earnings ratio of 33.01 indicates a quite expensive valuation of 1EL.
- Compared to the rest of the industry, the Price/Forward Earnings ratio of 1EL indicates a slightly more expensive valuation: 1EL is more expensive than 61.90% of the companies listed in the same industry.
- When comparing the Price/Forward Earnings ratio of 1EL to the average of the S&P500 Index (25.98), we can say 1EL is valued slightly more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 38.62 | ||
| Fwd PE | 33.01 |
4.2 Price Multiples
- 1EL's Enterprise Value to EBITDA ratio is in line with the industry average.
- 1EL's Price/Free Cash Flow is on the same level as the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 36.54 | ||
| EV/EBITDA | 20.18 |
4.3 Compensation for Growth
- The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates 1EL does not grow enough to justify the current Price/Earnings ratio.
- The decent profitability rating of 1EL may justify a higher PE ratio.
PEG (NY)6.79
PEG (5Y)2.41
EPS Next 2Y8.8%
EPS Next 3Y10.77%
5. Dividend
5.1 Amount
- 1EL has a Yearly Dividend Yield of 1.47%. Purely for dividend investing, there may be better candidates out there.
- 1EL's Dividend Yield is a higher than the industry average which is at 0.96.
- 1EL's Dividend Yield is comparable with the S&P500 average which is at 1.81.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.47% |
5.2 History
- The dividend of 1EL has a limited annual growth rate of 4.50%.
Dividend Growth(5Y)4.5%
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
- 1EL pays out 22.97% of its income as dividend. This is a sustainable payout ratio.
- 1EL's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP22.97%
EPS Next 2Y8.8%
EPS Next 3Y10.77%
ESSILORLUXOTTICA / 1EL.MI FAQ
What is the fundamental rating for 1EL stock?
ChartMill assigns a fundamental rating of 4 / 10 to 1EL.MI.
Can you provide the valuation status for ESSILORLUXOTTICA?
ChartMill assigns a valuation rating of 2 / 10 to ESSILORLUXOTTICA (1EL.MI). This can be considered as Overvalued.
What is the profitability of 1EL stock?
ESSILORLUXOTTICA (1EL.MI) has a profitability rating of 6 / 10.
What is the financial health of ESSILORLUXOTTICA (1EL.MI) stock?
The financial health rating of ESSILORLUXOTTICA (1EL.MI) is 3 / 10.
Can you provide the expected EPS growth for 1EL stock?
The Earnings per Share (EPS) of ESSILORLUXOTTICA (1EL.MI) is expected to grow by 5.69% in the next year.