ELECTRONIC ARTS INC (ERT.DE) Stock Fundamental Analysis
FRA:ERT - Deutsche Boerse Ag - US2855121099 - Common Stock - Currency: EUR
ERT gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 43 industry peers in the Entertainment industry. ERT scores excellent points on both the profitability and health parts. This is a solid base for a good stock. ERT is valued correctly, but it does not seem to be growing.
1. Profitability
1.1 Basic Checks
ERT had positive earnings in the past year.
ERT had a positive operating cash flow in the past year.
Each year in the past 5 years ERT has been profitable.
Each year in the past 5 years ERT had a positive operating cash flow.
1.2 Ratios
With a decent Return On Assets value of 7.80%, ERT is doing good in the industry, outperforming 79.07% of the companies in the same industry.
ERT has a Return On Equity of 14.15%. This is in the better half of the industry: ERT outperforms 62.79% of its industry peers.
With a decent Return On Invested Capital value of 10.48%, ERT is doing good in the industry, outperforming 79.07% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for ERT is in line with the industry average of 9.53%.
The 3 year average ROIC (9.83%) for ERT is below the current ROIC(10.48%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.8% | ||
| ROE | 14.15% | ||
| ROIC | 10.48% |
ROA(3y)7.05%
ROA(5y)10.96%
ROE(3y)12.76%
ROE(5y)17.94%
ROIC(3y)9.83%
ROIC(5y)9.75%
1.3 Margins
ERT has a Profit Margin of 14.28%. This is amongst the best in the industry. ERT outperforms 81.40% of its industry peers.
In the last couple of years the Profit Margin of ERT has declined.
ERT has a Operating Margin of 20.99%. This is amongst the best in the industry. ERT outperforms 88.37% of its industry peers.
In the last couple of years the Operating Margin of ERT has remained more or less at the same level.
ERT has a better Gross Margin (79.38%) than 69.77% of its industry peers.
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 | 20.99% | ||
| PM (TTM) | 14.28% | ||
| GM | 79.38% |
OM growth 3Y5.5%
OM growth 5Y1.35%
PM growth 3Y4.22%
PM growth 5Y-3.94%
GM growth 3Y1.85%
GM growth 5Y1.15%
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.
ERT has less shares outstanding than it did 1 year ago.
ERT has less shares outstanding than it did 5 years ago.
The debt/assets ratio for ERT is higher compared to a year ago.
2.2 Solvency
ERT has an Altman-Z score of 5.60. This indicates that ERT is financially healthy and has little risk of bankruptcy at the moment.
With an excellent Altman-Z score value of 5.60, ERT belongs to the best of the industry, outperforming 90.70% of the companies in the same industry.
The Debt to FCF ratio of ERT is 1.00, which is an excellent value as it means it would take ERT, only 1.00 years of fcf income to pay off all of its debts.
Looking at the Debt to FCF ratio, with a value of 1.00, ERT belongs to the top of the industry, outperforming 86.05% 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 67.44% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.25 | ||
| Debt/FCF | 1 | ||
| Altman-Z | 5.6 |
ROIC/WACC1.23
WACC8.55%
2.3 Liquidity
A Current Ratio of 1.38 indicates that ERT should not have too much problems paying its short term obligations.
ERT has a Current ratio of 1.38. This is in the better half of the industry: ERT outperforms 79.07% of its industry peers.
ERT has a Quick Ratio of 1.38. This is a normal value and indicates that ERT is financially healthy and should not expect problems in meeting its short term obligations.
The Quick ratio of ERT (1.38) is better than 79.07% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.38 | ||
| Quick Ratio | 1.38 |
3. Growth
3.1 Past
The earnings per share for ERT have decreased by -6.40% in the last year.
The Earnings Per Share has been growing by 10.27% on average over the past years. This is quite good.
Looking at the last year, ERT shows a decrease in Revenue. The Revenue has decreased by -4.05% in the last year.
The Revenue has been growing by 8.84% on average over the past years. This is quite good.
EPS 1Y (TTM)-6.4%
EPS 3Y6.36%
EPS 5Y10.27%
EPS Q2Q%-4.39%
Revenue 1Y (TTM)-4.05%
Revenue growth 3Y10.34%
Revenue growth 5Y8.84%
Sales Q2Q%-6.38%
3.2 Future
ERT is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 6.64% yearly.
The Revenue is expected to grow by 2.13% on average over the next years.
EPS Next Y-2.55%
EPS Next 2Y5.32%
EPS Next 3Y8.3%
EPS Next 5Y6.64%
Revenue Next Year-5.36%
Revenue Next 2Y0.35%
Revenue Next 3Y2.74%
Revenue Next 5Y2.13%
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 decreasing.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 21.32, ERT is valued on the expensive side.
ERT's Price/Earnings ratio is a bit cheaper when compared to the industry. ERT is cheaper than 74.42% of the companies in the same industry.
ERT is valuated rather cheaply when we compare the Price/Earnings ratio to 28.98, which is the current average of the S&P500 Index.
A Price/Forward Earnings ratio of 19.05 indicates a rather expensive valuation of ERT.
Based on the Price/Forward Earnings ratio, ERT is valued a bit cheaper than 67.44% of the companies in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 21.38, ERT is valued at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 21.32 | ||
| Fwd PE | 19.05 |
4.2 Price Multiples
ERT's Enterprise Value to EBITDA is on the same level as the industry average.
Based on the Price/Free Cash Flow ratio, ERT is valued a bit cheaper than 60.47% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 20.17 | ||
| EV/EBITDA | 18.55 |
4.3 Compensation for Growth
ERT has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)2.08
EPS Next 2Y5.32%
EPS Next 3Y8.3%
5. Dividend
5.1 Amount
With a yearly dividend of 0.52%, ERT is not a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 1.90, ERT pays a bit more dividend than its industry peers.
With a Dividend Yield of 0.52, ERT pays less dividend than the S&P500 average, which is at 2.46.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.52% |
5.2 History
Dividend Growth(5Y)N/A
Div Incr Years3
Div Non Decr Years4
5.3 Sustainability
19.26% of the earnings are spent on dividend by ERT. This is a low number and sustainable payout ratio.
DP19.26%
EPS Next 2Y5.32%
EPS Next 3Y8.3%
FRA:ERT (4/28/2025, 7:00:00 PM)
128.76
+0.3 (+0.23%)
Chartmill FA Rating
GICS SectorCommunication Services
GICS IndustryGroupMedia & Entertainment
GICS IndustryEntertainment
Earnings (Last)
Earnings (Next)
Inst Owners102.38%
Inst Owner ChangeN/A
Ins Owners0.18%
Ins Owner ChangeN/A
Market Cap33.56B
Analysts74.74
Price Target132.38 (2.81%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.52% |
Yearly Dividend0.67
Dividend Growth(5Y)N/A
DP19.26%
Div Incr Years3
Div Non Decr Years4
Ex-DateN/A
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-3.61%
Min EPS beat(2)-10.5%
Max EPS beat(2)3.27%
EPS beat(4)2
Avg EPS beat(4)0.4%
Min EPS beat(4)-12.28%
Max EPS beat(4)21.09%
EPS beat(8)5
Avg EPS beat(8)6.55%
EPS beat(12)7
Avg EPS beat(12)8.72%
EPS beat(16)10
Avg EPS beat(16)10.08%
Revenue beat(2)0
Avg Revenue beat(2)-4.2%
Min Revenue beat(2)-7.44%
Max Revenue beat(2)-0.95%
Revenue beat(4)0
Avg Revenue beat(4)-5.44%
Min Revenue beat(4)-8.76%
Max Revenue beat(4)-0.95%
Revenue beat(8)1
Avg Revenue beat(8)-3.23%
Revenue beat(12)3
Avg Revenue beat(12)-1.16%
Revenue beat(16)5
Avg Revenue beat(16)-2.26%
PT rev (1m)-6.5%
PT rev (3m)-17.44%
EPS NQ rev (1m)-0.15%
EPS NQ rev (3m)-38.4%
EPS NY rev (1m)0.04%
EPS NY rev (3m)-14.64%
Revenue NQ rev (1m)0.19%
Revenue NQ rev (3m)-15.83%
Revenue NY rev (1m)0.4%
Revenue NY rev (3m)-7.19%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 21.32 | ||
| Fwd PE | 19.05 | ||
| P/S | 5.19 | ||
| P/FCF | 20.17 | ||
| P/OCF | 18.09 | ||
| P/B | 5.15 | ||
| P/tB | 22.24 | ||
| EV/EBITDA | 18.55 |
EPS(TTM)6.04
EY4.69%
EPS(NY)6.76
Fwd EY5.25%
FCF(TTM)6.38
FCFY4.96%
OCF(TTM)7.12
OCFY5.53%
SpS24.79
BVpS25.01
TBVpS5.79
PEG (NY)N/A
PEG (5Y)2.08
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.8% | ||
| ROE | 14.15% | ||
| ROCE | 14.9% | ||
| ROIC | 10.48% | ||
| ROICexc | 15.07% | ||
| ROICexgc | 72.46% | ||
| OM | 20.99% | ||
| PM (TTM) | 14.28% | ||
| GM | 79.38% | ||
| FCFM | 25.75% |
ROA(3y)7.05%
ROA(5y)10.96%
ROE(3y)12.76%
ROE(5y)17.94%
ROIC(3y)9.83%
ROIC(5y)9.75%
ROICexc(3y)13.97%
ROICexc(5y)19.66%
ROICexgc(3y)86.06%
ROICexgc(5y)96.94%
ROCE(3y)13.99%
ROCE(5y)13.87%
ROICexcg growth 3Y-1.5%
ROICexcg growth 5YN/A
ROICexc growth 3Y-4.05%
ROICexc growth 5Y-22.03%
OM growth 3Y5.5%
OM growth 5Y1.35%
PM growth 3Y4.22%
PM growth 5Y-3.94%
GM growth 3Y1.85%
GM growth 5Y1.15%
F-Score6
Asset Turnover0.55
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.25 | ||
| Debt/FCF | 1 | ||
| Debt/EBITDA | 0.96 | ||
| Cap/Depr | 51.17% | ||
| Cap/Sales | 2.97% | ||
| Interest Coverage | 27.54 | ||
| Cash Conversion | 107.22% | ||
| Profit Quality | 180.36% | ||
| Current Ratio | 1.38 | ||
| Quick Ratio | 1.38 | ||
| Altman-Z | 5.6 |
F-Score6
WACC8.55%
ROIC/WACC1.23
Cap/Depr(3y)42.19%
Cap/Depr(5y)57.68%
Cap/Sales(3y)2.7%
Cap/Sales(5y)2.57%
Profit Quality(3y)183.51%
Profit Quality(5y)164.26%
High Growth Momentum
Growth
EPS 1Y (TTM)-6.4%
EPS 3Y6.36%
EPS 5Y10.27%
EPS Q2Q%-4.39%
EPS Next Y-2.55%
EPS Next 2Y5.32%
EPS Next 3Y8.3%
EPS Next 5Y6.64%
Revenue 1Y (TTM)-4.05%
Revenue growth 3Y10.34%
Revenue growth 5Y8.84%
Sales Q2Q%-6.38%
Revenue Next Year-5.36%
Revenue Next 2Y0.35%
Revenue Next 3Y2.74%
Revenue Next 5Y2.13%
EBIT growth 1Y-1.97%
EBIT growth 3Y16.41%
EBIT growth 5Y10.31%
EBIT Next Year5.42%
EBIT Next 3Y7.81%
EBIT Next 5Y7.19%
FCF growth 1Y62.54%
FCF growth 3Y5.34%
FCF growth 5Y8.18%
OCF growth 1Y53.23%
OCF growth 3Y6.18%
OCF growth 5Y8.4%