EASTMAN CHEMICAL CO (EMN) Stock Fundamental Analysis
NYSE:EMN - New York Stock Exchange, Inc. - US2774321002 - Common Stock - Currency: USD
Overall EMN gets a fundamental rating of 6 out of 10. We evaluated EMN against 85 industry peers in the Chemicals industry. While EMN belongs to the best of the industry regarding profitability, there are some minor concerns on its financial health. EMN has a correct valuation and a medium growth rate. EMN also has an excellent dividend rating.
1. Profitability
1.1 Basic Checks
EMN had positive earnings in the past year.
In the past year EMN had a positive cash flow from operations.
EMN had positive earnings in each of the past 5 years.
EMN had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
EMN has a Return On Assets of 5.95%. This is amongst the best in the industry. EMN outperforms 80.72% of its industry peers.
EMN's Return On Equity of 15.66% is amongst the best of the industry. EMN outperforms 83.13% of its industry peers.
EMN has a better Return On Invested Capital (8.93%) than 79.52% of its industry peers.
The Average Return On Invested Capital over the past 3 years for EMN is in line with the industry average of 6.80%.
The last Return On Invested Capital (8.93%) for EMN is above the 3 year average (8.36%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.95% | ||
| ROE | 15.66% | ||
| ROIC | 8.93% |
ROA(3y)5.82%
ROA(5y)5.19%
ROE(3y)15.81%
ROE(5y)14.08%
ROIC(3y)8.36%
ROIC(5y)8.64%
1.3 Margins
Looking at the Profit Margin, with a value of 9.65%, EMN belongs to the top of the industry, outperforming 81.93% of the companies in the same industry.
EMN's Profit Margin has improved in the last couple of years.
EMN has a Operating Margin of 14.28%. This is in the better half of the industry: EMN outperforms 77.11% of its industry peers.
EMN's Operating Margin has been stable in the last couple of years.
With a Gross Margin value of 24.41%, EMN perfoms like the industry average, outperforming 44.58% of the companies in the same industry.
In the last couple of years the Gross Margin of EMN has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 14.28% | ||
| PM (TTM) | 9.65% | ||
| GM | 24.41% |
OM growth 3Y-7.23%
OM growth 5Y1.24%
PM growth 3Y5.65%
PM growth 5Y3.34%
GM growth 3Y0.75%
GM growth 5Y0.26%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so EMN is still creating some value.
EMN has less shares outstanding than it did 1 year ago.
EMN has less shares outstanding than it did 5 years ago.
Compared to 1 year ago, EMN has an improved debt to assets ratio.
2.2 Solvency
An Altman-Z score of 2.66 indicates that EMN is not a great score, but indicates only limited risk for bankruptcy at the moment.
EMN has a Altman-Z score of 2.66. This is in the better half of the industry: EMN outperforms 75.90% of its industry peers.
EMN has a debt to FCF ratio of 7.29. This is a slightly negative value and a sign of low solvency as EMN would need 7.29 years to pay back of all of its debts.
With a decent Debt to FCF ratio value of 7.29, EMN is doing good in the industry, outperforming 62.65% of the companies in the same industry.
EMN has a Debt/Equity ratio of 0.79. This is a neutral value indicating EMN is somewhat dependend on debt financing.
The Debt to Equity ratio of EMN (0.79) is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.79 | ||
| Debt/FCF | 7.29 | ||
| Altman-Z | 2.66 |
ROIC/WACC1.07
WACC8.35%
2.3 Liquidity
A Current Ratio of 1.51 indicates that EMN should not have too much problems paying its short term obligations.
EMN's Current ratio of 1.51 is on the low side compared to the rest of the industry. EMN is outperformed by 68.67% of its industry peers.
EMN has a Quick Ratio of 1.51. This is a bad value and indicates that EMN is not financially healthy enough and could expect problems in meeting its short term obligations.
EMN has a Quick ratio of 0.78. This is amonst the worse of the industry: EMN underperforms 80.72% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.51 | ||
| Quick Ratio | 0.78 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 23.28% over the past year.
Measured over the past 5 years, EMN shows a small growth in Earnings Per Share. The EPS has been growing by 2.08% on average per year.
Looking at the last year, EMN shows a small growth in Revenue. The Revenue has grown by 1.87% in the last year.
The Revenue has been growing slightly by 0.23% on average over the past years.
EPS 1Y (TTM)23.28%
EPS 3Y-3.79%
EPS 5Y2.08%
EPS Q2Q%42.75%
Revenue 1Y (TTM)1.87%
Revenue growth 3Y-3.61%
Revenue growth 5Y0.23%
Sales Q2Q%1.72%
3.2 Future
The Earnings Per Share is expected to grow by 9.47% on average over the next years. This is quite good.
EMN is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 1.60% yearly.
EPS Next Y8.58%
EPS Next 2Y9.77%
EPS Next 3Y9.75%
EPS Next 5Y9.47%
Revenue Next Year2.14%
Revenue Next 2Y3.13%
Revenue Next 3Y3.31%
Revenue Next 5Y1.6%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better 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 accelerating.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 12.40, EMN is valued correctly.
Based on the Price/Earnings ratio, EMN is valued a bit cheaper than 78.31% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 29.43, EMN is valued rather cheaply.
With a Price/Forward Earnings ratio of 11.42, the valuation of EMN can be described as very reasonable.
Based on the Price/Forward Earnings ratio, EMN is valued a bit cheaper than the industry average as 74.70% of the companies are valued more expensively.
The average S&P500 Price/Forward Earnings ratio is at 22.67. EMN is valued slightly cheaper when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.4 | ||
| Fwd PE | 11.42 |
4.2 Price Multiples
EMN's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. EMN is cheaper than 66.27% of the companies in the same industry.
EMN's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. EMN is cheaper than 69.88% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 16.49 | ||
| EV/EBITDA | 8.39 |
4.3 Compensation for Growth
The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
EMN has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)1.45
PEG (5Y)5.98
EPS Next 2Y9.77%
EPS Next 3Y9.75%
5. Dividend
5.1 Amount
EMN has a Yearly Dividend Yield of 3.43%.
Compared to an average industry Dividend Yield of 3.37, EMN pays a better dividend. On top of this EMN pays more dividend than 81.93% of the companies listed in the same industry.
EMN's Dividend Yield is a higher than the S&P500 average which is at 2.29.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.43% |
5.2 History
The dividend of EMN has a limited annual growth rate of 5.58%.
EMN has paid a dividend for at least 10 years, which is a reliable track record.
EMN has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)5.58%
Div Incr Years14
Div Non Decr Years29
5.3 Sustainability
41.88% of the earnings are spent on dividend by EMN. This is a bit on the high side, but may be sustainable.
The dividend of EMN is growing, but earnings are growing more, so the dividend growth is sustainable.
DP41.88%
EPS Next 2Y9.77%
EPS Next 3Y9.75%
97.85
+0.95 (+0.98%)
Chartmill FA Rating
GICS SectorMaterials
GICS IndustryGroupMaterials
GICS IndustryChemicals
Earnings (Last)
Earnings (Next)
Inst Owners92.8%
Inst Owner Change0.92%
Ins Owners0.72%
Ins Owner Change6.27%
Market Cap11.34B
Analysts74.4
Price Target116.98 (19.55%)
Short Float %2.57%
Short Ratio2.51
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.43% |
Yearly Dividend3.26
Dividend Growth(5Y)5.58%
DP41.88%
Div Incr Years14
Div Non Decr Years29
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)11.33%
Min EPS beat(2)4.42%
Max EPS beat(2)18.25%
EPS beat(4)4
Avg EPS beat(4)9.89%
Min EPS beat(4)4.42%
Max EPS beat(4)18.25%
EPS beat(8)8
Avg EPS beat(8)8.96%
EPS beat(12)10
Avg EPS beat(12)3.62%
EPS beat(16)12
Avg EPS beat(16)2.91%
Revenue beat(2)1
Avg Revenue beat(2)0.2%
Min Revenue beat(2)-2.22%
Max Revenue beat(2)2.62%
Revenue beat(4)1
Avg Revenue beat(4)-0.15%
Min Revenue beat(4)-2.22%
Max Revenue beat(4)2.62%
Revenue beat(8)1
Avg Revenue beat(8)-2.31%
Revenue beat(12)3
Avg Revenue beat(12)-0.9%
Revenue beat(16)7
Avg Revenue beat(16)0.99%
PT rev (1m)1.16%
PT rev (3m)0.07%
EPS NQ rev (1m)1.31%
EPS NQ rev (3m)-1.45%
EPS NY rev (1m)-0.39%
EPS NY rev (3m)-2.31%
Revenue NQ rev (1m)-1.21%
Revenue NQ rev (3m)-2.19%
Revenue NY rev (1m)-1.52%
Revenue NY rev (3m)-2.21%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.4 | ||
| Fwd PE | 11.42 | ||
| P/S | 1.21 | ||
| P/FCF | 16.49 | ||
| P/OCF | 8.81 | ||
| P/B | 1.96 | ||
| P/tB | 10.17 | ||
| EV/EBITDA | 8.39 |
EPS(TTM)7.89
EY8.06%
EPS(NY)8.57
Fwd EY8.75%
FCF(TTM)5.94
FCFY6.07%
OCF(TTM)11.1
OCFY11.35%
SpS80.94
BVpS49.86
TBVpS9.62
PEG (NY)1.45
PEG (5Y)5.98
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.95% | ||
| ROE | 15.66% | ||
| ROCE | 10.72% | ||
| ROIC | 8.93% | ||
| ROICexc | 9.57% | ||
| ROICexgc | 15.94% | ||
| OM | 14.28% | ||
| PM (TTM) | 9.65% | ||
| GM | 24.41% | ||
| FCFM | 7.33% |
ROA(3y)5.82%
ROA(5y)5.19%
ROE(3y)15.81%
ROE(5y)14.08%
ROIC(3y)8.36%
ROIC(5y)8.64%
ROICexc(3y)8.83%
ROICexc(5y)9.06%
ROICexgc(3y)15.26%
ROICexgc(5y)15.76%
ROCE(3y)10.04%
ROCE(5y)10.38%
ROICexcg growth 3Y-10.23%
ROICexcg growth 5Y3.54%
ROICexc growth 3Y-9.52%
ROICexc growth 5Y5.53%
OM growth 3Y-7.23%
OM growth 5Y1.24%
PM growth 3Y5.65%
PM growth 5Y3.34%
GM growth 3Y0.75%
GM growth 5Y0.26%
F-Score6
Asset Turnover0.62
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.79 | ||
| Debt/FCF | 7.29 | ||
| Debt/EBITDA | 2.47 | ||
| Cap/Depr | 117.68% | ||
| Cap/Sales | 6.38% | ||
| Interest Coverage | 6.6 | ||
| Cash Conversion | 69.61% | ||
| Profit Quality | 76.02% | ||
| Current Ratio | 1.51 | ||
| Quick Ratio | 0.78 | ||
| Altman-Z | 2.66 |
F-Score6
WACC8.35%
ROIC/WACC1.07
Cap/Depr(3y)138.26%
Cap/Depr(5y)116.93%
Cap/Sales(3y)7.09%
Cap/Sales(5y)6.22%
Profit Quality(3y)60.45%
Profit Quality(5y)105.96%
High Growth Momentum
Growth
EPS 1Y (TTM)23.28%
EPS 3Y-3.79%
EPS 5Y2.08%
EPS Q2Q%42.75%
EPS Next Y8.58%
EPS Next 2Y9.77%
EPS Next 3Y9.75%
EPS Next 5Y9.47%
Revenue 1Y (TTM)1.87%
Revenue growth 3Y-3.61%
Revenue growth 5Y0.23%
Sales Q2Q%1.72%
Revenue Next Year2.14%
Revenue Next 2Y3.13%
Revenue Next 3Y3.31%
Revenue Next 5Y1.6%
EBIT growth 1Y31.76%
EBIT growth 3Y-10.58%
EBIT growth 5Y1.48%
EBIT Next Year54.6%
EBIT Next 3Y20.8%
EBIT Next 5Y16.92%
FCF growth 1Y26.01%
FCF growth 3Y-13.53%
FCF growth 5Y-8.61%
OCF growth 1Y-6.33%
OCF growth 3Y-7.36%
OCF growth 5Y-3.07%