ELECTRONIC ARTS INC (ERT.DE) Stock Fundamental Analysis
FRA:ERT - Deutsche Boerse Ag - US2855121099 - Common Stock - Currency: EUR
Overall ERT gets a fundamental rating of 6 out of 10. We evaluated ERT against 46 industry peers in the Entertainment industry. ERT has outstanding health and profitabily ratings, belonging to the best of the industry. This is a solid base for any company. 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
ERT has a better Return On Assets (7.80%) than 84.78% of its industry peers.
The Return On Equity of ERT (14.15%) is better than 71.74% of its industry peers.
ERT has a Return On Invested Capital of 10.48%. This is amongst the best in the industry. ERT outperforms 82.61% of its industry peers.
The Average Return On Invested Capital over the past 3 years for ERT is in line with the industry average of 8.15%.
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
The Profit Margin of ERT (14.28%) is better than 84.78% of its industry peers.
ERT's Profit Margin has declined in the last couple of years.
ERT has a Operating Margin of 20.99%. This is amongst the best in the industry. ERT outperforms 91.30% of its industry peers.
ERT's Operating Margin has been stable in the last couple of years.
ERT has a Gross Margin of 79.38%. This is in the better half of the industry: ERT outperforms 67.39% of its industry peers.
ERT's Gross Margin has been stable in the last couple of years.
| 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
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), ERT is creating some value.
Compared to 1 year ago, ERT has less shares outstanding
The number of shares outstanding for ERT has been reduced compared to 5 years ago.
Compared to 1 year ago, ERT has a worse debt to assets ratio.
2.2 Solvency
ERT has an Altman-Z score of 5.41. This indicates that ERT is financially healthy and has little risk of bankruptcy at the moment.
The Altman-Z score of ERT (5.41) is better than 89.13% of its industry peers.
ERT has a debt to FCF ratio of 1.00. This is a very positive value and a sign of high solvency as it would only need 1.00 years to pay back of 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 89.13% 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.
The Debt to Equity ratio of ERT (0.25) is better than 71.74% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.25 | ||
| Debt/FCF | 1 | ||
| Altman-Z | 5.41 |
ROIC/WACC1.22
WACC8.62%
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 better Current ratio (1.38) than 78.26% of its industry peers.
A Quick Ratio of 1.38 indicates that ERT should not have too much problems paying its short term obligations.
The Quick ratio of ERT (1.38) is better than 78.26% 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.
Measured over the past years, ERT shows a quite strong growth in Earnings Per Share. The EPS has been growing by 10.27% on average per year.
The Revenue has decreased by -4.05% in the past 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
Based on estimates for the next years, ERT will show a small growth in Earnings Per Share. The EPS will grow by 6.64% on average per year.
The Revenue is expected to grow by 4.15% on average over the next years.
EPS Next Y-2.5%
EPS Next 2Y5.15%
EPS Next 3Y7.42%
EPS Next 5Y6.64%
Revenue Next Year-5.73%
Revenue Next 2Y0.04%
Revenue Next 3Y2.36%
Revenue Next 5Y4.15%
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 decreasing.
4. Valuation
4.1 Price/Earnings Ratio
ERT is valuated rather expensively with a Price/Earnings ratio of 20.27.
Compared to the rest of the industry, the Price/Earnings ratio of ERT indicates a rather cheap valuation: ERT is cheaper than 82.61% of the companies listed in the same industry.
The average S&P500 Price/Earnings ratio is at 29.35. ERT is valued slightly cheaper when compared to this.
A Price/Forward Earnings ratio of 18.18 indicates a rather expensive valuation of ERT.
Compared to the rest of the industry, the Price/Forward Earnings ratio of ERT indicates a somewhat cheap valuation: ERT is cheaper than 71.74% of the companies listed in the same industry.
When comparing the Price/Forward Earnings ratio of ERT to the average of the S&P500 Index (22.10), we can say ERT is valued inline with the index average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 20.27 | ||
| Fwd PE | 18.18 |
4.2 Price Multiples
ERT's Enterprise Value to EBITDA ratio is in line with the industry average.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of ERT indicates a somewhat cheap valuation: ERT is cheaper than 76.09% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 19.18 | ||
| EV/EBITDA | 17.6 |
4.3 Compensation for Growth
The excellent profitability rating of ERT may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)1.97
EPS Next 2Y5.15%
EPS Next 3Y7.42%
5. Dividend
5.1 Amount
ERT has a yearly dividend return of 0.56%, which is pretty low.
ERT's Dividend Yield is a higher than the industry average which is at 2.78.
Compared to an average S&P500 Dividend Yield of 2.33, ERT's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.56% |
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 2Y5.15%
EPS Next 3Y7.42%
FRA:ERT (3/7/2025, 7:00:00 PM)
128.28
+5.02 (+4.07%)
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 Cap33.43B
Analysts73.89
Price Target141.58 (10.37%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.56% |
Yearly Dividend0.7
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)-4.73%
PT rev (3m)-9.57%
EPS NQ rev (1m)-22.64%
EPS NQ rev (3m)-38.24%
EPS NY rev (1m)-7.4%
EPS NY rev (3m)-14.59%
Revenue NQ rev (1m)-6.46%
Revenue NQ rev (3m)-16.3%
Revenue NY rev (1m)-3.08%
Revenue NY rev (3m)-7.7%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 20.27 | ||
| Fwd PE | 18.18 | ||
| P/S | 4.94 | ||
| P/FCF | 19.18 | ||
| P/OCF | 17.2 | ||
| P/B | 4.9 | ||
| P/tB | 21.15 | ||
| EV/EBITDA | 17.6 |
EPS(TTM)6.33
EY4.93%
EPS(NY)7.06
Fwd EY5.5%
FCF(TTM)6.69
FCFY5.21%
OCF(TTM)7.46
OCFY5.81%
SpS25.97
BVpS26.19
TBVpS6.06
PEG (NY)N/A
PEG (5Y)1.97
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 | 5.41 |
F-Score6
WACC8.62%
ROIC/WACC1.22
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-2.5%
EPS Next 2Y5.15%
EPS Next 3Y7.42%
EPS Next 5Y6.64%
Revenue 1Y (TTM)-4.05%
Revenue growth 3Y10.34%
Revenue growth 5Y8.84%
Sales Q2Q%-6.38%
Revenue Next Year-5.73%
Revenue Next 2Y0.04%
Revenue Next 3Y2.36%
Revenue Next 5Y4.15%
EBIT growth 1Y-1.97%
EBIT growth 3Y16.41%
EBIT growth 5Y10.31%
EBIT Next Year14.33%
EBIT Next 3Y10.69%
EBIT Next 5Y8.55%
FCF growth 1Y62.54%
FCF growth 3Y5.34%
FCF growth 5Y8.18%
OCF growth 1Y53.23%
OCF growth 3Y6.18%
OCF growth 5Y8.4%