CHEMED CORP (CHE) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:CHE - US16359R1032 - Common Stock
431.65 USD
-0.91 (-0.21%)
We assign a fundamental rating of 7 out of 10 to CHE. CHE was compared to 103 industry peers in the Health Care Providers & Services industry. CHE scores excellent points on both the profitability and health parts. This is a solid base for a good stock. CHE has a valuation in line with the averages, but on the other hand it scores bad on growth.
1. Profitability
1.1 Basic Checks
- In the past year CHE was profitable.
- CHE had a positive operating cash flow in the past year.
- In the past 5 years CHE has always been profitable.
- CHE had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
- The Return On Assets of CHE (17.17%) is better than 99.03% of its industry peers.
- CHE's Return On Equity of 25.89% is amongst the best of the industry. CHE outperforms 92.23% of its industry peers.
- CHE has a better Return On Invested Capital (21.27%) than 96.12% of its industry peers.
- CHE had an Average Return On Invested Capital over the past 3 years of 21.96%. This is significantly above the industry average of 9.21%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 17.17% | ||
| ROE | 25.89% | ||
| ROIC | 21.27% |
ROA(3y)17.25%
ROA(5y)18.8%
ROE(3y)27.61%
ROE(5y)32.28%
ROIC(3y)21.96%
ROIC(5y)22.92%
1.3 Margins
- CHE's Profit Margin of 11.02% is amongst the best of the industry. CHE outperforms 94.17% of its industry peers.
- CHE's Profit Margin has improved in the last couple of years.
- CHE has a better Operating Margin (14.60%) than 88.35% of its industry peers.
- CHE's Operating Margin has improved in the last couple of years.
- CHE has a Gross Margin of 32.88%. This is in the better half of the industry: CHE outperforms 64.08% of its industry peers.
- CHE's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 14.6% | ||
| PM (TTM) | 11.02% | ||
| GM | 32.88% |
OM growth 3Y-0.29%
OM growth 5Y3.39%
PM growth 3Y-0.36%
PM growth 5Y1.83%
GM growth 3Y-0.79%
GM growth 5Y1.99%
2. Health
2.1 Basic Checks
- With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), CHE is creating value.
- The number of shares outstanding for CHE has been reduced compared to 1 year ago.
- CHE has less shares outstanding than it did 5 years ago.
- There is no outstanding debt for CHE. This means it has a Debt/Equity and Debt/FCF ratio of 0 and it is amongst the best of the sector and industry.
2.2 Solvency
- CHE has an Altman-Z score of 11.59. This indicates that CHE is financially healthy and has little risk of bankruptcy at the moment.
- With an excellent Altman-Z score value of 11.59, CHE belongs to the best of the industry, outperforming 96.12% of the companies in the same industry.
- CHE has a debt to FCF ratio of 0.00. This is a very positive value and a sign of high solvency as it would only need 0.00 years to pay back of all of its debts.
- CHE has a better Debt to FCF ratio (0.00) than 94.17% of its industry peers.
- A Debt/Equity ratio of 0.00 indicates that CHE is not too dependend on debt financing.
- Looking at the Debt to Equity ratio, with a value of 0.00, CHE belongs to the top of the industry, outperforming 85.44% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0 | ||
| Altman-Z | 11.59 |
ROIC/WACC2.4
WACC8.88%
2.3 Liquidity
- CHE has a Current Ratio of 1.35. This is a normal value and indicates that CHE is financially healthy and should not expect problems in meeting its short term obligations.
- With a Current ratio value of 1.35, CHE perfoms like the industry average, outperforming 49.51% of the companies in the same industry.
- A Quick Ratio of 1.33 indicates that CHE should not have too much problems paying its short term obligations.
- Looking at the Quick ratio, with a value of 1.33, CHE is in line with its industry, outperforming 54.37% of the companies in the same industry.
- CHE does not score too well on the current and quick ratio evaluation. However, as it has excellent solvency and profitability, these ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.35 | ||
| Quick Ratio | 1.33 |
3. Growth
3.1 Past
- CHE shows a slight negative growth in Earnings Per Share. In the last year, the EPS has decreased by -3.97%.
- The Earnings Per Share has been growing by 10.64% on average over the past years. This is quite good.
- The Revenue has been growing slightly by 6.45% in the past year.
- The Revenue has been growing slightly by 4.63% on average over the past years.
EPS 1Y (TTM)-3.97%
EPS 3Y6.14%
EPS 5Y10.64%
EPS Q2Q%-6.56%
Revenue 1Y (TTM)6.45%
Revenue growth 3Y4.36%
Revenue growth 5Y4.63%
Sales Q2Q%3.09%
3.2 Future
- CHE is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 6.13% yearly.
- CHE is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 5.17% yearly.
EPS Next Y-3.15%
EPS Next 2Y5.45%
EPS Next 3Y6.13%
EPS Next 5YN/A
Revenue Next Year5.02%
Revenue Next 2Y5.54%
Revenue Next 3Y5.17%
Revenue Next 5YN/A
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.
- 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
- A Price/Earnings ratio of 19.62 indicates a rather expensive valuation of CHE.
- CHE's Price/Earnings ratio is a bit cheaper when compared to the industry. CHE is cheaper than 70.87% of the companies in the same industry.
- CHE's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 28.60.
- Based on the Price/Forward Earnings ratio of 16.77, the valuation of CHE can be described as correct.
- Based on the Price/Forward Earnings ratio, CHE is valued a bit cheaper than 70.87% of the companies in the same industry.
- Compared to an average S&P500 Price/Forward Earnings ratio of 25.83, CHE is valued a bit cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.62 | ||
| Fwd PE | 16.77 |
4.2 Price Multiples
- Based on the Enterprise Value to EBITDA ratio, CHE is valued a bit cheaper than 63.11% of the companies in the same industry.
- Compared to the rest of the industry, the Price/Free Cash Flow ratio of CHE indicates a somewhat cheap valuation: CHE is cheaper than 69.90% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 16.96 | ||
| EV/EBITDA | 13.82 |
4.3 Compensation for Growth
- CHE has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)1.84
EPS Next 2Y5.45%
EPS Next 3Y6.13%
5. Dividend
5.1 Amount
- CHE has a yearly dividend return of 0.54%, which is pretty low.
- CHE's Dividend Yield is rather good when compared to the industry average which is at 0.45. CHE pays more dividend than 81.55% of the companies in the same industry.
- Compared to an average S&P500 Dividend Yield of 1.82, CHE's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.54% |
5.2 History
- On average, the dividend of CHE grows each year by 8.02%, which is quite nice.
- CHE has been paying a dividend for at least 10 years, so it has a reliable track record.
- CHE has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)8.02%
Div Incr Years16
Div Non Decr Years21
5.3 Sustainability
- CHE pays out 11.01% of its income as dividend. This is a sustainable payout ratio.
- CHE's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP11.01%
EPS Next 2Y5.45%
EPS Next 3Y6.13%
CHEMED CORP / CHE FAQ
What is the fundamental rating for CHE stock?
ChartMill assigns a fundamental rating of 7 / 10 to CHE.
What is the valuation status of CHEMED CORP (CHE) stock?
ChartMill assigns a valuation rating of 5 / 10 to CHEMED CORP (CHE). This can be considered as Fairly Valued.
Can you provide the profitability details for CHEMED CORP?
CHEMED CORP (CHE) has a profitability rating of 9 / 10.
Can you provide the financial health for CHE stock?
The financial health rating of CHEMED CORP (CHE) is 9 / 10.
What is the earnings growth outlook for CHEMED CORP?
The Earnings per Share (EPS) of CHEMED CORP (CHE) is expected to decline by -3.15% in the next year.