EMCOR GROUP INC (EME) Stock Fundamental Analysis
NYSE:EME - New York Stock Exchange, Inc. - US29084Q1004 - Common Stock - Currency: USD
We assign a fundamental rating of 7 out of 10 to EME. EME was compared to 52 industry peers in the Construction & Engineering industry. Both the health and profitability get an excellent rating, making EME a very profitable company, without any liquidiy or solvency issues. EME is not valued too expensively and it also shows a decent growth rate. These ratings would make EME suitable for quality investing!
1. Profitability
1.1 Basic Checks
EME had positive earnings in the past year.
In the past year EME had a positive cash flow from operations.
Each year in the past 5 years EME has been profitable.
Each year in the past 5 years EME had a positive operating cash flow.
1.2 Ratios
EME has a Return On Assets of 13.01%. This is amongst the best in the industry. EME outperforms 88.46% of its industry peers.
EME has a Return On Equity of 35.62%. This is amongst the best in the industry. EME outperforms 90.38% of its industry peers.
With an excellent Return On Invested Capital value of 26.51%, EME belongs to the best of the industry, outperforming 92.31% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for EME is above the industry average of 16.67%.
The 3 year average ROIC (21.01%) for EME is below the current ROIC(26.51%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 13.01% | ||
| ROE | 35.62% | ||
| ROIC | 26.51% |
ROA(3y)9.99%
ROA(5y)7.93%
ROE(3y)26.83%
ROE(5y)20.8%
ROIC(3y)21.01%
ROIC(5y)17.59%
1.3 Margins
With a decent Profit Margin value of 7.00%, EME is doing good in the industry, outperforming 78.85% of the companies in the same industry.
EME's Profit Margin has improved in the last couple of years.
EME has a Operating Margin of 9.36%. This is in the better half of the industry: EME outperforms 75.00% of its industry peers.
EME's Operating Margin has improved in the last couple of years.
EME has a Gross Margin (19.32%) which is in line with its industry peers.
In the last couple of years the Gross Margin of EME has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 9.36% | ||
| PM (TTM) | 7% | ||
| GM | 19.32% |
OM growth 3Y19.88%
OM growth 5Y12.87%
PM growth 3Y21.31%
PM growth 5Y14.3%
GM growth 3Y7.78%
GM growth 5Y5.13%
2. Health
2.1 Basic Checks
EME has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
Compared to 1 year ago, EME has less shares outstanding
The number of shares outstanding for EME has been reduced compared to 5 years ago.
Compared to 1 year ago, EME has an improved debt to assets ratio.
2.2 Solvency
EME has an Altman-Z score of 6.27. This indicates that EME is financially healthy and has little risk of bankruptcy at the moment.
With an excellent Altman-Z score value of 6.27, EME belongs to the best of the industry, outperforming 82.69% of the companies in the same industry.
The Debt to FCF ratio of EME is 0.20, which is an excellent value as it means it would take EME, only 0.20 years of fcf income to pay off all of its debts.
EME has a Debt to FCF ratio of 0.20. This is amongst the best in the industry. EME outperforms 92.31% of its industry peers.
A Debt/Equity ratio of 0.09 indicates that EME is not too dependend on debt financing.
The Debt to Equity ratio of EME (0.09) is better than 84.62% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.09 | ||
| Debt/FCF | 0.2 | ||
| Altman-Z | 6.27 |
ROIC/WACC2.56
WACC10.34%
2.3 Liquidity
A Current Ratio of 1.16 indicates that EME should not have too much problems paying its short term obligations.
EME has a Current ratio (1.16) which is comparable to the rest of the industry.
A Quick Ratio of 1.14 indicates that EME should not have too much problems paying its short term obligations.
Looking at the Quick ratio, with a value of 1.14, EME is in line with its industry, outperforming 42.31% of the companies in the same industry.
The current and quick ratio evaluation for EME is rather negative, while it does have 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 | 1.16 | ||
| Quick Ratio | 1.14 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 49.27% over the past year.
EME shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 30.23% yearly.
Looking at the last year, EME shows a quite strong growth in Revenue. The Revenue has grown by 14.30% in the last year.
EME shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 9.69% yearly.
EPS 1Y (TTM)49.27%
EPS 3Y45.04%
EPS 5Y30.23%
EPS Q2Q%26.14%
Revenue 1Y (TTM)14.3%
Revenue growth 3Y13.72%
Revenue growth 5Y9.69%
Sales Q2Q%12.68%
3.2 Future
Based on estimates for the next years, EME will show a quite strong growth in Earnings Per Share. The EPS will grow by 8.98% on average per year.
Based on estimates for the next years, EME will show a small growth in Revenue. The Revenue will grow by 7.02% on average per year.
EPS Next Y11.51%
EPS Next 2Y9.46%
EPS Next 3Y8.98%
EPS Next 5YN/A
Revenue Next Year12.69%
Revenue Next 2Y9.13%
Revenue Next 3Y7.02%
Revenue Next 5YN/A
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
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
Based on the Price/Earnings ratio of 24.49, the valuation of EME can be described as rather expensive.
EME's Price/Earnings ratio is a bit cheaper when compared to the industry. EME is cheaper than 69.23% of the companies in the same industry.
EME's Price/Earnings ratio indicates a similar valuation than the S&P500 average which is at 27.30.
Based on the Price/Forward Earnings ratio of 21.47, the valuation of EME can be described as rather expensive.
Compared to the rest of the industry, the Price/Forward Earnings ratio of EME indicates a somewhat cheap valuation: EME is cheaper than 67.31% of the companies listed in the same industry.
EME's Price/Forward Earnings ratio indicates a similar valuation than the S&P500 average which is at 21.76.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 24.49 | ||
| Fwd PE | 21.47 |
4.2 Price Multiples
61.54% of the companies in the same industry are more expensive than EME, based on the Enterprise Value to EBITDA ratio.
Based on the Price/Free Cash Flow ratio, EME is valued a bit cheaper than the industry average as 69.23% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 19.03 | ||
| EV/EBITDA | 15.61 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates EME does not grow enough to justify the current Price/Earnings ratio.
The excellent profitability rating of EME may justify a higher PE ratio.
PEG (NY)2.13
PEG (5Y)0.81
EPS Next 2Y9.46%
EPS Next 3Y8.98%
5. Dividend
5.1 Amount
With a yearly dividend of 0.18%, EME is not a good candidate for dividend investing.
EME's Dividend Yield is a higher than the industry average which is at 1.70.
Compared to an average S&P500 Dividend Yield of 2.37, EME's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.18% |
5.2 History
On average, the dividend of EME grows each year by 23.83%, which is quite nice.
EME has paid a dividend for at least 10 years, which is a reliable track record.
EME has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)23.83%
Div Incr Years4
Div Non Decr Years11
5.3 Sustainability
EME pays out 4.41% of its income as dividend. This is a sustainable payout ratio.
EME's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP4.41%
EPS Next 2Y9.46%
EPS Next 3Y8.98%
554.22
+6.63 (+1.21%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryConstruction & Engineering
Earnings (Last)
Earnings (Next)
Inst Owners96.35%
Inst Owner Change0.13%
Ins Owners0.83%
Ins Owner Change-1.46%
Market Cap24.81B
Analysts81.67
Price Target495.11 (-10.67%)
Short Float %2.82%
Short Ratio2.63
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.18% |
Yearly Dividend0.93
Dividend Growth(5Y)23.83%
DP4.41%
Div Incr Years4
Div Non Decr Years11
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)10.64%
Min EPS beat(2)8.66%
Max EPS beat(2)12.61%
EPS beat(4)4
Avg EPS beat(4)18.71%
Min EPS beat(4)8.66%
Max EPS beat(4)38.31%
EPS beat(8)8
Avg EPS beat(8)24.9%
EPS beat(12)12
Avg EPS beat(12)21.81%
EPS beat(16)14
Avg EPS beat(16)16.27%
Revenue beat(2)1
Avg Revenue beat(2)-0.38%
Min Revenue beat(2)-1.95%
Max Revenue beat(2)1.19%
Revenue beat(4)2
Avg Revenue beat(4)-0.15%
Min Revenue beat(4)-2.92%
Max Revenue beat(4)3.09%
Revenue beat(8)6
Avg Revenue beat(8)0.88%
Revenue beat(12)9
Avg Revenue beat(12)1.15%
Revenue beat(16)13
Avg Revenue beat(16)2.05%
PT rev (1m)0%
PT rev (3m)-2.88%
EPS NQ rev (1m)-0.17%
EPS NQ rev (3m)0.14%
EPS NY rev (1m)0.56%
EPS NY rev (3m)2.59%
Revenue NQ rev (1m)0.1%
Revenue NQ rev (3m)0.58%
Revenue NY rev (1m)0%
Revenue NY rev (3m)0.54%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 24.49 | ||
| Fwd PE | 21.47 | ||
| P/S | 1.65 | ||
| P/FCF | 19.03 | ||
| P/OCF | 17.92 | ||
| P/B | 8.41 | ||
| P/tB | 48.02 | ||
| EV/EBITDA | 15.61 |
EPS(TTM)22.63
EY4.08%
EPS(NY)25.81
Fwd EY4.66%
FCF(TTM)29.12
FCFY5.25%
OCF(TTM)30.92
OCFY5.58%
SpS335.15
BVpS65.91
TBVpS11.54
PEG (NY)2.13
PEG (5Y)0.81
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 13.01% | ||
| ROE | 35.62% | ||
| ROCE | 36.4% | ||
| ROIC | 26.51% | ||
| ROICexc | 31.17% | ||
| ROICexgc | 120.78% | ||
| OM | 9.36% | ||
| PM (TTM) | 7% | ||
| GM | 19.32% | ||
| FCFM | 8.69% |
ROA(3y)9.99%
ROA(5y)7.93%
ROE(3y)26.83%
ROE(5y)20.8%
ROIC(3y)21.01%
ROIC(5y)17.59%
ROICexc(3y)29.88%
ROICexc(5y)24.94%
ROICexgc(3y)103.88%
ROICexgc(5y)84.98%
ROCE(3y)28.85%
ROCE(5y)24.15%
ROICexcg growth 3Y52.49%
ROICexcg growth 5Y34.99%
ROICexc growth 3Y37.05%
ROICexc growth 5Y27.08%
OM growth 3Y19.88%
OM growth 5Y12.87%
PM growth 3Y21.31%
PM growth 5Y14.3%
GM growth 3Y7.78%
GM growth 5Y5.13%
F-Score6
Asset Turnover1.86
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.09 | ||
| Debt/FCF | 0.2 | ||
| Debt/EBITDA | 0.16 | ||
| Cap/Depr | 55.33% | ||
| Cap/Sales | 0.54% | ||
| Interest Coverage | 501.13 | ||
| Cash Conversion | 89.31% | ||
| Profit Quality | 124.04% | ||
| Current Ratio | 1.16 | ||
| Quick Ratio | 1.14 | ||
| Altman-Z | 6.27 |
F-Score6
WACC10.34%
ROIC/WACC2.56
Cap/Depr(3y)55.78%
Cap/Depr(5y)48.91%
Cap/Sales(3y)0.53%
Cap/Sales(5y)0.5%
Profit Quality(3y)124.19%
Profit Quality(5y)203.38%
High Growth Momentum
Growth
EPS 1Y (TTM)49.27%
EPS 3Y45.04%
EPS 5Y30.23%
EPS Q2Q%26.14%
EPS Next Y11.51%
EPS Next 2Y9.46%
EPS Next 3Y8.98%
EPS Next 5YN/A
Revenue 1Y (TTM)14.3%
Revenue growth 3Y13.72%
Revenue growth 5Y9.69%
Sales Q2Q%12.68%
Revenue Next Year12.69%
Revenue Next 2Y9.13%
Revenue Next 3Y7.02%
Revenue Next 5YN/A
EBIT growth 1Y42.77%
EBIT growth 3Y36.33%
EBIT growth 5Y23.8%
EBIT Next Year24.57%
EBIT Next 3Y11.87%
EBIT Next 5YN/A
FCF growth 1Y190.77%
FCF growth 3Y67.7%
FCF growth 5Y34.11%
OCF growth 1Y171.84%
OCF growth 3Y64.06%
OCF growth 5Y31.67%