ELEMENT SOLUTIONS INC (ESI) Stock Fundamental Analysis
USA - NYSE:ESI - US28618M1062 - Common Stock
25.38 USD
-0.71 (-2.72%)
25.38 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 outstanding health and profitabily ratings, belonging to the best of the industry. This is a solid base for any company. 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
Looking at the Return On Assets, with a value of 4.81%, ESI belongs to the top of the industry, outperforming 80.72% of the companies in the same industry.
ESI has a better Return On Equity (9.15%) than 74.70% of its industry peers.
The Return On Invested Capital of ESI (6.41%) is better than 69.88% of its industry peers.
The Average Return On Invested Capital over the past 3 years for ESI is in line with the industry average of 6.30%.
The last Return On Invested Capital (6.41%) for ESI is above the 3 year average (5.90%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.81% | ||
| ROE | 9.15% | ||
| ROIC | 6.41% |
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 9.66%, ESI belongs to the top of the industry, outperforming 86.75% of the companies in the same industry.
In the last couple of years the Profit Margin of ESI has grown nicely.
ESI has a Operating Margin of 13.73%. This is in the better half of the industry: ESI outperforms 72.29% of its industry peers.
In the last couple of years the Operating Margin of ESI has remained more or less at the same level.
The Gross Margin of ESI (41.81%) is better than 89.16% of its industry peers.
In the last couple of years the Gross Margin of ESI has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 13.73% | ||
| PM (TTM) | 9.66% | ||
| GM | 41.82% |
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
ESI has a better debt/assets ratio than last year.
2.2 Solvency
ESI has an Altman-Z score of 2.28. 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.
ESI has a better Altman-Z score (2.28) than 63.86% of its industry peers.
ESI has a debt to FCF ratio of 5.97. This is a neutral value as ESI would need 5.97 years to pay back of all of its debts.
ESI's Debt to FCF ratio of 5.97 is fine compared to the rest of the industry. ESI outperforms 77.11% of its industry peers.
ESI has a Debt/Equity ratio of 0.62. This is a neutral value indicating ESI is somewhat dependend on debt financing.
ESI has a Debt to Equity ratio (0.62) which is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.62 | ||
| Debt/FCF | 5.97 | ||
| Altman-Z | 2.28 |
ROIC/WACC0.8
WACC8.02%
2.3 Liquidity
ESI has a Current Ratio of 4.10. This indicates that ESI is financially healthy and has no problem in meeting its short term obligations.
ESI has a Current ratio of 4.10. This is amongst the best in the industry. ESI outperforms 91.57% of its industry peers.
ESI has a Quick Ratio of 3.30. This indicates that ESI is financially healthy and has no problem in meeting its short term obligations.
The Quick ratio of ESI (3.30) is better than 92.77% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 4.1 | ||
| Quick Ratio | 3.3 |
3. Growth
3.1 Past
ESI shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 5.07%.
The Earnings Per Share has been growing by 10.10% on average over the past years. This is quite good.
Looking at the last year, ESI shows a small growth in Revenue. The Revenue has grown by 5.41% in the last year.
The Revenue has been growing slightly by 6.00% on average over the past years.
EPS 1Y (TTM)5.07%
EPS 3Y1.43%
EPS 5Y10.1%
EPS Q2Q%2.78%
Revenue 1Y (TTM)5.41%
Revenue growth 3Y0.79%
Revenue growth 5Y6%
Sales Q2Q%2.04%
3.2 Future
The Earnings Per Share is expected to grow by 9.29% on average over the next years. This is quite good.
The Revenue is expected to grow by 4.47% on average over the next years.
EPS Next Y3.58%
EPS Next 2Y7.45%
EPS Next 3Y9.29%
EPS Next 5YN/A
Revenue Next Year2.61%
Revenue Next 2Y4.25%
Revenue Next 3Y4.47%
Revenue Next 5YN/A
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 decreasing.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 17.50, ESI is valued on the expensive side.
Compared to the rest of the industry, the Price/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/Earnings ratio is at 27.57. ESI is valued slightly cheaper when compared to this.
With a Price/Forward Earnings ratio of 15.27, ESI is valued correctly.
ESI's Price/Forward Earnings ratio is in line with the industry average.
ESI's Price/Forward Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 23.09.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 17.5 | ||
| Fwd PE | 15.27 |
4.2 Price Multiples
ESI's Enterprise Value to EBITDA is on the same level as the industry average.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of ESI indicates a somewhat cheap valuation: ESI is cheaper than 63.86% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 22.53 | ||
| EV/EBITDA | 14.62 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
The excellent profitability rating of ESI may justify a higher PE ratio.
PEG (NY)4.89
PEG (5Y)1.73
EPS Next 2Y7.45%
EPS Next 3Y9.29%
5. Dividend
5.1 Amount
ESI has a Yearly Dividend Yield of 1.23%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 3.76, ESI has a dividend in line with its industry peers.
Compared to an average S&P500 Dividend Yield of 2.32, ESI's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.23% |
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
ESI pays out 32.40% of its income as dividend. This is a sustainable payout ratio.
DP32.4%
EPS Next 2Y7.45%
EPS Next 3Y9.29%
25.38
-0.71 (-2.72%)
Chartmill FA Rating
GICS SectorMaterials
GICS IndustryGroupMaterials
GICS IndustryChemicals
Earnings (Last)
Earnings (Next)
Inst Owners100.89%
Inst Owner Change0.38%
Ins Owners7.37%
Ins Owner Change2.75%
Market Cap6.13B
Revenue(TTM)2.49B
Net Income(TTM)240.40M
Analysts81.25
Price Target29.38 (15.76%)
Short Float %3.77%
Short Ratio4.32
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.23% |
Yearly Dividend0.32
Dividend Growth(5Y)N/A
DP32.4%
Div Incr Years0
Div Non Decr Years4
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)3.11%
Min EPS beat(2)2.93%
Max EPS beat(2)3.29%
EPS beat(4)3
Avg EPS beat(4)1.8%
Min EPS beat(4)-0.19%
Max EPS beat(4)3.29%
EPS beat(8)6
Avg EPS beat(8)2.43%
EPS beat(12)8
Avg EPS beat(12)1.82%
EPS beat(16)12
Avg EPS beat(16)2.41%
Revenue beat(2)2
Avg Revenue beat(2)2.65%
Min Revenue beat(2)1.94%
Max Revenue beat(2)3.36%
Revenue beat(4)4
Avg Revenue beat(4)2.74%
Min Revenue beat(4)1.94%
Max Revenue beat(4)3.73%
Revenue beat(8)4
Avg Revenue beat(8)0.19%
Revenue beat(12)4
Avg Revenue beat(12)-1.41%
Revenue beat(16)7
Avg Revenue beat(16)-0.13%
PT rev (1m)0.38%
PT rev (3m)4.01%
EPS NQ rev (1m)0.23%
EPS NQ rev (3m)4.46%
EPS NY rev (1m)0%
EPS NY rev (3m)3.7%
Revenue NQ rev (1m)0.1%
Revenue NQ rev (3m)2.49%
Revenue NY rev (1m)0.04%
Revenue NY rev (3m)2.4%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 17.5 | ||
| Fwd PE | 15.27 | ||
| P/S | 2.46 | ||
| P/FCF | 22.53 | ||
| P/OCF | 18.26 | ||
| P/B | 2.34 | ||
| P/tB | N/A | ||
| EV/EBITDA | 14.62 |
EPS(TTM)1.45
EY5.71%
EPS(NY)1.66
Fwd EY6.55%
FCF(TTM)1.13
FCFY4.44%
OCF(TTM)1.39
OCFY5.48%
SpS10.3
BVpS10.87
TBVpS-1.33
PEG (NY)4.89
PEG (5Y)1.73
Graham Number18.83
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.81% | ||
| ROE | 9.15% | ||
| ROCE | 7.35% | ||
| ROIC | 6.41% | ||
| ROICexc | 7.23% | ||
| ROICexgc | 25.45% | ||
| OM | 13.73% | ||
| PM (TTM) | 9.66% | ||
| GM | 41.82% | ||
| FCFM | 10.94% |
ROA(3y)3.73%
ROA(5y)3.37%
ROE(3y)7.78%
ROE(5y)6.96%
ROIC(3y)5.9%
ROIC(5y)5.62%
ROICexc(3y)6.33%
ROICexc(5y)6.03%
ROICexgc(3y)23.36%
ROICexgc(5y)25.05%
ROCE(3y)6.76%
ROCE(5y)6.44%
ROICexgc growth 3Y-6.36%
ROICexgc growth 5Y-4.9%
ROICexc growth 3Y6.8%
ROICexc growth 5Y5.1%
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%
F-Score8
Asset Turnover0.5
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.62 | ||
| Debt/FCF | 5.97 | ||
| Debt/EBITDA | 3.29 | ||
| Cap/Depr | 41.68% | ||
| Cap/Sales | 2.56% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 67.95% | ||
| Profit Quality | 113.23% | ||
| Current Ratio | 4.1 | ||
| Quick Ratio | 3.3 | ||
| Altman-Z | 2.28 |
F-Score8
WACC8.02%
ROIC/WACC0.8
Cap/Depr(3y)34.88%
Cap/Depr(5y)30.15%
Cap/Sales(3y)2.31%
Cap/Sales(5y)2.08%
Profit Quality(3y)164.7%
Profit Quality(5y)187.42%
High Growth Momentum
Growth
EPS 1Y (TTM)5.07%
EPS 3Y1.43%
EPS 5Y10.1%
EPS Q2Q%2.78%
EPS Next Y3.58%
EPS Next 2Y7.45%
EPS Next 3Y9.29%
EPS Next 5YN/A
Revenue 1Y (TTM)5.41%
Revenue growth 3Y0.79%
Revenue growth 5Y6%
Sales Q2Q%2.04%
Revenue Next Year2.61%
Revenue Next 2Y4.25%
Revenue Next 3Y4.47%
Revenue Next 5YN/A
EBIT growth 1Y10.69%
EBIT growth 3Y4.67%
EBIT growth 5Y6.66%
EBIT Next Year13.59%
EBIT Next 3Y9.79%
EBIT Next 5YN/A
FCF growth 1Y-13.72%
FCF growth 3Y2.24%
FCF growth 5YN/A
OCF growth 1Y-7.87%
OCF growth 3Y4.08%
OCF growth 5Y108.63%