ELEMENT SOLUTIONS INC (ESI) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:ESI - US28618M1062 - Common Stock
29.5 USD
+0.81 (+2.82%)
29.5 USD
0 (0%)
Taking everything into account, ESI scores 6 out of 10 in our fundamental rating. ESI was compared to 83 industry peers in the Chemicals industry. ESI has an excellent profitability rating, but there are some minor concerns on its financial health. ESI is not valued too expensively and it also shows a decent growth rate.
1. Profitability
1.1 Basic Checks
- ESI had positive earnings in the past year.
- ESI had a positive operating cash flow in the past year.
- In the past 5 years ESI has always been profitable.
- In the past 5 years ESI always reported a positive cash flow from operatings.
1.2 Ratios
- With a decent Return On Assets value of 4.75%, ESI is doing good in the industry, outperforming 79.52% of the companies in the same industry.
- ESI has a better Return On Equity (9.02%) than 77.11% of its industry peers.
- Looking at the Return On Invested Capital, with a value of 6.49%, ESI is in the better half of the industry, outperforming 71.08% of the companies in the same industry.
- The Average Return On Invested Capital over the past 3 years for ESI is in line with the industry average of 6.11%.
- The last Return On Invested Capital (6.49%) for ESI is above the 3 year average (5.90%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.75% | ||
| ROE | 9.02% | ||
| ROIC | 6.49% |
ROA(3y)3.73%
ROA(5y)3.37%
ROE(3y)7.78%
ROE(5y)6.96%
ROIC(3y)5.9%
ROIC(5y)5.62%
1.3 Margins
- Looking at the Profit Margin, with a value of 9.58%, ESI belongs to the top of the industry, outperforming 85.54% of the companies in the same industry.
- ESI's Profit Margin has improved in the last couple of years.
- ESI has a better Operating Margin (13.90%) than 72.29% of its industry peers.
- ESI's Operating Margin has been stable in the last couple of years.
- The Gross Margin of ESI (42.01%) is better than 86.75% of its industry peers.
- ESI's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 13.9% | ||
| PM (TTM) | 9.58% | ||
| GM | 42.01% |
OM growth 3Y3.85%
OM growth 5Y0.62%
PM growth 3Y5.47%
PM growth 5Y14.63%
GM growth 3Y1.73%
GM growth 5Y-0.37%
2. Health
2.1 Basic Checks
- The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so ESI is destroying value.
- The number of shares outstanding for ESI has been increased compared to 1 year ago.
- Compared to 5 years ago, ESI has less shares outstanding
- Compared to 1 year ago, ESI has an improved debt to assets ratio.
2.2 Solvency
- ESI has an Altman-Z score of 2.49. This is not the best score and indicates that ESI is in the grey zone with still only limited risk for bankruptcy at the moment.
- The Altman-Z score of ESI (2.49) is better than 66.27% of its industry peers.
- The Debt to FCF ratio of ESI is 6.02, which is on the high side as it means it would take ESI, 6.02 years of fcf income to pay off all of its debts.
- Looking at the Debt to FCF ratio, with a value of 6.02, ESI is in the better half of the industry, outperforming 74.70% of the companies in the same industry.
- ESI has a Debt/Equity ratio of 0.61. This is a neutral value indicating ESI is somewhat dependend on debt financing.
- ESI has a Debt to Equity ratio of 0.61. This is comparable to the rest of the industry: ESI outperforms 55.42% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.61 | ||
| Debt/FCF | 6.02 | ||
| Altman-Z | 2.49 |
ROIC/WACC0.49
WACC13.17%
2.3 Liquidity
- ESI has a Current Ratio of 4.05. This indicates that ESI is financially healthy and has no problem in meeting its short term obligations.
- With an excellent Current ratio value of 4.05, ESI belongs to the best of the industry, outperforming 90.36% of the companies in the same industry.
- A Quick Ratio of 3.28 indicates that ESI has no problem at all paying its short term obligations.
- ESI's Quick ratio of 3.28 is amongst the best of the industry. ESI outperforms 91.57% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 4.05 | ||
| Quick Ratio | 3.28 |
3. Growth
3.1 Past
- The Earnings Per Share has been growing slightly by 4.26% over the past year.
- ESI shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 10.10% yearly.
- ESI shows a small growth in Revenue. In the last year, the Revenue has grown by 3.87%.
- Measured over the past years, ESI shows a small growth in Revenue. The Revenue has been growing by 6.00% on average per year.
EPS 1Y (TTM)4.26%
EPS 3Y1.43%
EPS 5Y10.1%
EPS Q2Q%5.13%
Revenue 1Y (TTM)3.87%
Revenue growth 3Y0.79%
Revenue growth 5Y6%
Sales Q2Q%1.72%
3.2 Future
- Based on estimates for the next years, ESI will show a quite strong growth in Earnings Per Share. The EPS will grow by 9.64% on average per year.
- Based on estimates for the next years, ESI will show a small growth in Revenue. The Revenue will grow by 6.57% on average per year.
EPS Next Y3.96%
EPS Next 2Y9.34%
EPS Next 3Y10.51%
EPS Next 5Y9.64%
Revenue Next Year3.01%
Revenue Next 2Y7.27%
Revenue Next 3Y6.91%
Revenue Next 5Y6.57%
3.3 Evolution
- The EPS growth rate is stable: in the next years the growth will be about the same 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 20.07, which indicates a rather expensive current valuation of ESI.
- ESI's Price/Earnings ratio is in line with the industry average.
- Compared to an average S&P500 Price/Earnings ratio of 27.25, ESI is valued a bit cheaper.
- The Price/Forward Earnings ratio is 17.14, which indicates a rather expensive current valuation of ESI.
- Compared to the rest of the industry, the Price/Forward Earnings ratio of ESI indicates a somewhat cheap valuation: ESI is cheaper than 60.24% of the companies listed in the same industry.
- The average S&P500 Price/Forward Earnings ratio is at 25.98. ESI is valued slightly cheaper when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 20.07 | ||
| Fwd PE | 17.14 |
4.2 Price Multiples
- 62.65% of the companies in the same industry are cheaper than ESI, based on the Enterprise Value to EBITDA ratio.
- Based on the Price/Free Cash Flow ratio, ESI is valued a bit cheaper than 62.65% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 26.45 | ||
| EV/EBITDA | 15.97 |
4.3 Compensation for Growth
- The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates ESI does not grow enough to justify the current Price/Earnings ratio.
- The excellent profitability rating of ESI may justify a higher PE ratio.
PEG (NY)5.06
PEG (5Y)1.99
EPS Next 2Y9.34%
EPS Next 3Y10.51%
5. Dividend
5.1 Amount
- ESI has a Yearly Dividend Yield of 1.10%. Purely for dividend investing, there may be better candidates out there.
- Compared to an average industry Dividend Yield of 2.23, ESI has a dividend in line with its industry peers.
- ESI's Dividend Yield is slightly below the S&P500 average, which is at 1.82.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.1% |
5.2 History
- ESI has been paying a dividend for over 5 years, so it has already some track record.
- ESI has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)N/A
Div Incr Years0
Div Non Decr Years4
5.3 Sustainability
- 32.50% of the earnings are spent on dividend by ESI. This is a low number and sustainable payout ratio.
DP32.5%
EPS Next 2Y9.34%
EPS Next 3Y10.51%
ELEMENT SOLUTIONS INC / ESI FAQ
Can you provide the ChartMill fundamental rating for ELEMENT SOLUTIONS INC?
ChartMill assigns a fundamental rating of 6 / 10 to ESI.
What is the valuation status for ESI stock?
ChartMill assigns a valuation rating of 4 / 10 to ELEMENT SOLUTIONS INC (ESI). This can be considered as Fairly Valued.
Can you provide the profitability details for ELEMENT SOLUTIONS INC?
ELEMENT SOLUTIONS INC (ESI) has a profitability rating of 8 / 10.
Can you provide the financial health for ESI stock?
The financial health rating of ELEMENT SOLUTIONS INC (ESI) is 6 / 10.
What is the earnings growth outlook for ELEMENT SOLUTIONS INC?
The Earnings per Share (EPS) of ELEMENT SOLUTIONS INC (ESI) is expected to grow by 3.96% in the next year.