ELECTRONIC ARTS INC (ERT.DE) Stock Fundamental Analysis
Europe - Frankfurt Stock Exchange - FRA:ERT - US2855121099 - Common Stock
173.58 EUR
-0.36 (-0.21%)
Overall ERT gets a fundamental rating of 5 out of 10. We evaluated ERT against 44 industry peers in the Entertainment industry. While ERT belongs to the best of the industry regarding profitability, there are some minor concerns on its financial health. ERT has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
In the past year ERT was profitable.
In the past year ERT had a positive cash flow from operations.
In the past 5 years ERT has always been profitable.
In the past 5 years ERT always reported a positive cash flow from operatings.
1.2 Ratios
Looking at the Return On Assets, with a value of 7.47%, ERT belongs to the top of the industry, outperforming 84.09% of the companies in the same industry.
The Return On Equity of ERT (14.75%) is better than 72.73% of its industry peers.
ERT has a better Return On Invested Capital (10.85%) than 81.82% of its industry peers.
The Average Return On Invested Capital over the past 3 years for ERT is above the industry average of 9.87%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.47% | ||
| ROE | 14.75% | ||
| ROIC | 10.85% |
ROA(3y)8.17%
ROA(5y)7.3%
ROE(3y)15.16%
ROE(5y)13.3%
ROIC(3y)12.06%
ROIC(5y)10.47%
1.3 Margins
ERT has a better Profit Margin (12.14%) than 79.55% of its industry peers.
In the last couple of years the Profit Margin of ERT has declined.
The Operating Margin of ERT (17.11%) is better than 93.18% of its industry peers.
ERT's Operating Margin has declined in the last couple of years.
With a decent Gross Margin value of 78.79%, ERT is doing good in the industry, outperforming 65.91% of the companies in the same industry.
In the last couple of years the Gross Margin of ERT has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 17.11% | ||
| PM (TTM) | 12.14% | ||
| GM | 78.79% |
OM growth 3Y7.96%
OM growth 5Y-4.32%
PM growth 3Y10%
PM growth 5Y-22.83%
GM growth 3Y2.54%
GM growth 5Y1.05%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so ERT is still creating some value.
The number of shares outstanding for ERT has been reduced compared to 1 year ago.
Compared to 5 years ago, ERT has less shares outstanding
Compared to 1 year ago, ERT has a worse debt to assets ratio.
2.2 Solvency
ERT has an Altman-Z score of 6.88. This indicates that ERT is financially healthy and has little risk of bankruptcy at the moment.
ERT has a better Altman-Z score (6.88) than 88.64% of its industry peers.
ERT has a debt to FCF ratio of 1.14. This is a very positive value and a sign of high solvency as it would only need 1.14 years to pay back of all of its debts.
With an excellent Debt to FCF ratio value of 1.14, ERT belongs to the best of the industry, outperforming 86.36% of the companies in the same industry.
ERT has a Debt/Equity ratio of 0.25. This is a healthy value indicating a solid balance between debt and equity.
ERT's Debt to Equity ratio of 0.25 is fine compared to the rest of the industry. ERT outperforms 72.73% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.25 | ||
| Debt/FCF | 1.14 | ||
| Altman-Z | 6.88 |
ROIC/WACC1.05
WACC10.38%
2.3 Liquidity
ERT has a Current Ratio of 0.84. This is a bad value and indicates that ERT is not financially healthy enough and could expect problems in meeting its short term obligations.
The Current ratio of ERT (0.84) is comparable to the rest of the industry.
A Quick Ratio of 0.84 indicates that ERT may have some problems paying its short term obligations.
ERT has a Quick ratio (0.84) which is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.84 | ||
| Quick Ratio | 0.84 |
3. Growth
3.1 Past
ERT shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -21.43%.
ERT shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 6.84% yearly.
ERT shows a decrease in Revenue. In the last year, the revenue decreased by -1.63%.
Measured over the past years, ERT shows a small growth in Revenue. The Revenue has been growing by 6.15% on average per year.
EPS 1Y (TTM)-21.43%
EPS 3Y-1.54%
EPS 5Y6.84%
EPS Q2Q%-43.72%
Revenue 1Y (TTM)-1.63%
Revenue growth 3Y2.2%
Revenue growth 5Y6.15%
Sales Q2Q%-12.55%
3.2 Future
ERT is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 9.25% yearly.
The Revenue is expected to grow by 5.29% on average over the next years.
EPS Next Y30.93%
EPS Next 2Y19.27%
EPS Next 3Y15.83%
EPS Next 5Y9.25%
Revenue Next Year12.89%
Revenue Next 2Y8.18%
Revenue Next 3Y7.2%
Revenue Next 5Y5.29%
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 stable.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 37.17, which means the current valuation is very expensive for ERT.
77.27% of the companies in the same industry are more expensive than ERT, based on the Price/Earnings ratio.
When comparing the Price/Earnings ratio of ERT to the average of the S&P500 Index (26.92), we can say ERT is valued slightly more expensively.
The Price/Forward Earnings ratio is 21.43, which indicates a rather expensive current valuation of ERT.
Based on the Price/Forward Earnings ratio, ERT is valued a bit cheaper than 68.18% of the companies in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 23.46, ERT is valued at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 37.17 | ||
| Fwd PE | 21.43 |
4.2 Price Multiples
The rest of the industry has a similar Enterprise Value to EBITDA ratio as ERT.
ERT's Price/Free Cash Flow is on the same level as the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 30.96 | ||
| EV/EBITDA | 33.09 |
4.3 Compensation for Growth
The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
The decent profitability rating of ERT may justify a higher PE ratio.
A more expensive valuation may be justified as ERT's earnings are expected to grow with 15.83% in the coming years.
PEG (NY)1.2
PEG (5Y)5.43
EPS Next 2Y19.27%
EPS Next 3Y15.83%
5. Dividend
5.1 Amount
ERT has a yearly dividend return of 0.37%, which is pretty low.
ERT's Dividend Yield is a higher than the industry average which is at 0.98.
With a Dividend Yield of 0.37, ERT pays less dividend than the S&P500 average, which is at 2.00.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.37% |
5.2 History
Dividend Growth(5Y)N/A
Div Incr Years0
Div Non Decr Years4
5.3 Sustainability
21.92% of the earnings are spent on dividend by ERT. This is a low number and sustainable payout ratio.
DP21.92%
EPS Next 2Y19.27%
EPS Next 3Y15.83%
FRA:ERT (12/22/2025, 7:00:00 PM)
173.58
-0.36 (-0.21%)
Chartmill FA Rating
GICS SectorCommunication Services
GICS IndustryGroupMedia & Entertainment
GICS IndustryEntertainment
Earnings (Last)
Earnings (Next)
Inst Owners100.93%
Inst Owner ChangeN/A
Ins Owners0.15%
Ins Owner ChangeN/A
Market Cap43.41B
Revenue(TTM)7.29B
Net Income(TTM)885.00M
Analysts67.65
Price Target169.75 (-2.21%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.37% |
Yearly Dividend0.65
Dividend Growth(5Y)N/A
DP21.92%
Div Incr Years0
Div Non Decr Years4
Ex-DateN/A
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)56.28%
Min EPS beat(2)-9.82%
Max EPS beat(2)122.37%
EPS beat(4)2
Avg EPS beat(4)27.51%
Min EPS beat(4)-10.5%
Max EPS beat(4)122.37%
EPS beat(8)4
Avg EPS beat(8)15.01%
EPS beat(12)7
Avg EPS beat(12)13.5%
EPS beat(16)9
Avg EPS beat(16)13.86%
Revenue beat(2)0
Avg Revenue beat(2)-3.97%
Min Revenue beat(2)-6.05%
Max Revenue beat(2)-1.89%
Revenue beat(4)1
Avg Revenue beat(4)-0.91%
Min Revenue beat(4)-7.44%
Max Revenue beat(4)11.74%
Revenue beat(8)1
Avg Revenue beat(8)-2.73%
Revenue beat(12)2
Avg Revenue beat(12)-4.1%
Revenue beat(16)4
Avg Revenue beat(16)-2.8%
PT rev (1m)-0.54%
PT rev (3m)11.4%
EPS NQ rev (1m)-0.41%
EPS NQ rev (3m)8.24%
EPS NY rev (1m)2.42%
EPS NY rev (3m)3.13%
Revenue NQ rev (1m)0.2%
Revenue NQ rev (3m)7.43%
Revenue NY rev (1m)1.12%
Revenue NY rev (3m)2.17%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 37.17 | ||
| Fwd PE | 21.43 | ||
| P/S | 7.02 | ||
| P/FCF | 30.96 | ||
| P/OCF | 27.34 | ||
| P/B | 8.53 | ||
| P/tB | 139.43 | ||
| EV/EBITDA | 33.09 |
EPS(TTM)4.67
EY2.69%
EPS(NY)8.1
Fwd EY4.67%
FCF(TTM)5.61
FCFY3.23%
OCF(TTM)6.35
OCFY3.66%
SpS24.72
BVpS20.35
TBVpS1.24
PEG (NY)1.2
PEG (5Y)5.43
Graham Number46.24
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.47% | ||
| ROE | 14.75% | ||
| ROCE | 14.48% | ||
| ROIC | 10.85% | ||
| ROICexc | 12.71% | ||
| ROICexgc | 54.33% | ||
| OM | 17.11% | ||
| PM (TTM) | 12.14% | ||
| GM | 78.79% | ||
| FCFM | 22.68% |
ROA(3y)8.17%
ROA(5y)7.3%
ROE(3y)15.16%
ROE(5y)13.3%
ROIC(3y)12.06%
ROIC(5y)10.47%
ROICexc(3y)16.76%
ROICexc(5y)16.45%
ROICexgc(3y)98.03%
ROICexgc(5y)99%
ROCE(3y)16.08%
ROCE(5y)13.96%
ROICexgc growth 3Y5.86%
ROICexgc growth 5Y-3.33%
ROICexc growth 3Y13.37%
ROICexc growth 5Y-15.13%
OM growth 3Y7.96%
OM growth 5Y-4.32%
PM growth 3Y10%
PM growth 5Y-22.83%
GM growth 3Y2.54%
GM growth 5Y1.05%
F-Score7
Asset Turnover0.61
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.25 | ||
| Debt/FCF | 1.14 | ||
| Debt/EBITDA | 0.95 | ||
| Cap/Depr | 69.52% | ||
| Cap/Sales | 3% | ||
| Interest Coverage | 22.27 | ||
| Cash Conversion | 119.85% | ||
| Profit Quality | 186.78% | ||
| Current Ratio | 0.84 | ||
| Quick Ratio | 0.84 | ||
| Altman-Z | 6.88 |
F-Score7
WACC10.38%
ROIC/WACC1.05
Cap/Depr(3y)49.99%
Cap/Depr(5y)51.43%
Cap/Sales(3y)2.79%
Cap/Sales(5y)2.65%
Profit Quality(3y)166.47%
Profit Quality(5y)186.51%
High Growth Momentum
Growth
EPS 1Y (TTM)-21.43%
EPS 3Y-1.54%
EPS 5Y6.84%
EPS Q2Q%-43.72%
EPS Next Y30.93%
EPS Next 2Y19.27%
EPS Next 3Y15.83%
EPS Next 5Y9.25%
Revenue 1Y (TTM)-1.63%
Revenue growth 3Y2.2%
Revenue growth 5Y6.15%
Sales Q2Q%-12.55%
Revenue Next Year12.89%
Revenue Next 2Y8.18%
Revenue Next 3Y7.2%
Revenue Next 5Y5.29%
EBIT growth 1Y-18.44%
EBIT growth 3Y10.34%
EBIT growth 5Y1.57%
EBIT Next Year41.75%
EBIT Next 3Y16.17%
EBIT Next 5Y10.74%
FCF growth 1Y-18.17%
FCF growth 3Y2.79%
FCF growth 5Y2.32%
OCF growth 1Y-15.33%
OCF growth 3Y3.06%
OCF growth 5Y2.96%
ELECTRONIC ARTS INC / ERT.DE FAQ
What is the ChartMill fundamental rating of ELECTRONIC ARTS INC (ERT.DE) stock?
ChartMill assigns a fundamental rating of 5 / 10 to ERT.DE.
What is the valuation status of ELECTRONIC ARTS INC (ERT.DE) stock?
ChartMill assigns a valuation rating of 4 / 10 to ELECTRONIC ARTS INC (ERT.DE). This can be considered as Fairly Valued.
What is the profitability of ERT stock?
ELECTRONIC ARTS INC (ERT.DE) has a profitability rating of 7 / 10.
How financially healthy is ELECTRONIC ARTS INC?
The financial health rating of ELECTRONIC ARTS INC (ERT.DE) is 6 / 10.
Can you provide the expected EPS growth for ERT stock?
The Earnings per Share (EPS) of ELECTRONIC ARTS INC (ERT.DE) is expected to grow by 30.93% in the next year.