ESSEX PROPERTY TRUST INC (ESS)
US2971781057 - REIT
We assign a fundamental rating of 4 out of 10 to ESS. ESS was compared to 20 industry peers in the Residential REITs industry. ESS scores excellent on profitability, but there are concerns on its financial health. While showing a medium growth rate, ESS is valued expensive at the moment.
1. Profitability
1.1 Basic Checks
ESS had positive earnings in the past year.
ESS had a positive operating cash flow in the past year.
ESS had positive earnings in each of the past 5 years.
ESS had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
ESS's Return On Assets of 4.34% is fine compared to the rest of the industry. ESS outperforms 80.00% of its industry peers.
The Return On Equity of ESS (10.11%) is better than 90.00% of its industry peers.
The Return On Invested Capital of ESS (3.44%) is better than 80.00% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for ESS is in line with the industry average of 2.61%.
The 3 year average ROIC (3.08%) for ESS is below the current ROIC(3.44%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.34% | ||
| ROE | 10.11% | ||
| ROIC | 3.44% |
ROA(3y)3.45%
ROA(5y)3.64%
ROE(3y)7.59%
ROE(5y)7.86%
ROIC(3y)3.08%
ROIC(5y)3.02%
1.3 Margins
The Profit Margin of ESS (31.55%) is better than 95.00% of its industry peers.
In the last couple of years the Profit Margin of ESS has declined.
ESS has a better Operating Margin (30.39%) than 80.00% of its industry peers.
ESS's Operating Margin has been stable in the last couple of years.
ESS's Gross Margin of 70.83% is amongst the best of the industry. ESS outperforms 95.00% of its industry peers.
In the last couple of years the Gross Margin of ESS has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 30.39% | ||
| PM (TTM) | 31.55% | ||
| GM | 70.83% |
OM growth 3Y3.12%
OM growth 5Y-0.4%
PM growth 3Y-13.86%
PM growth 5Y-2.7%
GM growth 3Y0.17%
GM growth 5Y-0.43%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so ESS is destroying value.
ESS has less shares outstanding than it did 1 year ago.
Compared to 5 years ago, ESS has less shares outstanding
Compared to 1 year ago, ESS has a worse debt to assets ratio.
2.2 Solvency
Based on the Altman-Z score of 1.60, we must say that ESS is in the distress zone and has some risk of bankruptcy.
ESS's Altman-Z score of 1.60 is fine compared to the rest of the industry. ESS outperforms 70.00% of its industry peers.
The Debt to FCF ratio of ESS is 42.01, which is on the high side as it means it would take ESS, 42.01 years of fcf income to pay off all of its debts.
ESS's Debt to FCF ratio of 42.01 is in line compared to the rest of the industry. ESS outperforms 60.00% of its industry peers.
A Debt/Equity ratio of 1.17 is on the high side and indicates that ESS has dependencies on debt financing.
Looking at the Debt to Equity ratio, with a value of 1.17, ESS is in line with its industry, outperforming 45.00% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.17 | ||
| Debt/FCF | 42.01 | ||
| Altman-Z | 1.6 |
ROIC/WACC0.45
WACC7.58%
2.3 Liquidity
ESS has a Current Ratio of 0.40. This is a bad value and indicates that ESS is not financially healthy enough and could expect problems in meeting its short term obligations.
With a Current ratio value of 0.40, ESS perfoms like the industry average, outperforming 45.00% of the companies in the same industry.
ESS has a Quick Ratio of 0.40. This is a bad value and indicates that ESS is not financially healthy enough and could expect problems in meeting its short term obligations.
ESS has a Quick ratio (0.35) which is in line with its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.4 | ||
| Quick Ratio | 0.35 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 5.03% over the past year.
ESS shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 1.42% yearly.
Looking at the last year, ESS shows a small growth in Revenue. The Revenue has grown by 4.74% in the last year.
Measured over the past years, ESS shows a small growth in Revenue. The Revenue has been growing by 3.58% on average per year.
EPS 1Y (TTM)5.03%
EPS 3Y3.75%
EPS 5Y1.42%
EPS Q2Q%35.29%
Revenue 1Y (TTM)4.74%
Revenue growth 3Y3.73%
Revenue growth 5Y3.58%
Sales Q2Q%6.91%
3.2 Future
The Earnings Per Share is expected to grow by 3.25% on average over the next years.
ESS is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 4.29% yearly.
EPS Next Y37.14%
EPS Next 2Y-2.06%
EPS Next 3Y0.5%
EPS Next 5Y3.25%
Revenue Next Year5.54%
Revenue Next 2Y4.99%
Revenue Next 3Y4.64%
Revenue Next 5Y4.29%
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 accelerating.
The Revenue growth rate is stable: in the next years the growth will be about the same than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
ESS is valuated quite expensively with a Price/Earnings ratio of 33.15.
Based on the Price/Earnings ratio, ESS is valued a bit cheaper than the industry average as 75.00% of the companies are valued more expensively.
ESS's Price/Earnings ratio indicates a similar valuation than the S&P500 average which is at 27.73.
With a Price/Forward Earnings ratio of 46.88, ESS can be considered very expensive at the moment.
Based on the Price/Forward Earnings ratio, ESS is valued a bit cheaper than 70.00% of the companies in the same industry.
ESS is valuated expensively when we compare the Price/Forward Earnings ratio to 22.83, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 33.15 | ||
| Fwd PE | 46.88 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of ESS indicates a slightly more expensive valuation: ESS is more expensive than 75.00% of the companies listed in the same industry.
ESS's Price/Free Cash Flow ratio is in line with the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 120.35 | ||
| EV/EBITDA | 22.04 |
4.3 Compensation for Growth
ESS's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
ESS has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)0.89
PEG (5Y)23.32
EPS Next 2Y-2.06%
EPS Next 3Y0.5%
5. Dividend
5.1 Amount
ESS has a Yearly Dividend Yield of 3.24%.
ESS's Dividend Yield is slightly below the industry average, which is at 3.99.
ESS's Dividend Yield is a higher than the S&P500 average which is at 2.24.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.24% |
5.2 History
The dividend of ESS has a limited annual growth rate of 3.57%.
ESS has been paying a dividend for at least 10 years, so it has a reliable track record.
ESS has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)3.57%
Div Incr Years29
Div Non Decr Years29
5.3 Sustainability
ESS pays out 111.25% of its income as dividend. This is not a sustainable payout ratio.
The dividend of ESS is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP111.25%
EPS Next 2Y-2.06%
EPS Next 3Y0.5%
ESSEX PROPERTY TRUST INC
NYSE:ESS (12/20/2024, 8:07:35 PM)
After market: 283.76 0 (0%)283.76
+4.75 (+1.7%)
Chartmill FA Rating
GICS SectorReal Estate
GICS IndustryGroupEquity Real Estate Investment Trusts (REITs)
GICS IndustryResidential REITs
Earnings (Last)
Earnings (Next)
Inst Owners96.37%
Inst Owner Change-0.23%
Ins Owners0.62%
Ins Owner Change-0.08%
Market Cap18.24B
Analysts66
Price Target310.92 (9.57%)
Short Float %1.43%
Short Ratio2.78
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.24% |
Dividend Growth(5Y)3.57%
DP111.25%
Div Incr Years29
Div Non Decr Years29
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)19.58%
Min EPS beat(2)6.19%
Max EPS beat(2)32.98%
EPS beat(4)3
Avg EPS beat(4)58.42%
Min EPS beat(4)-30.66%
Max EPS beat(4)225.19%
EPS beat(8)6
Avg EPS beat(8)52.2%
EPS beat(12)8
Avg EPS beat(12)39.52%
EPS beat(16)12
Avg EPS beat(16)48.69%
Revenue beat(2)1
Avg Revenue beat(2)0.58%
Min Revenue beat(2)-0.27%
Max Revenue beat(2)1.43%
Revenue beat(4)2
Avg Revenue beat(4)0.24%
Min Revenue beat(4)-0.52%
Max Revenue beat(4)1.43%
Revenue beat(8)2
Avg Revenue beat(8)-0.39%
Revenue beat(12)5
Avg Revenue beat(12)-0.06%
Revenue beat(16)6
Avg Revenue beat(16)-0.22%
PT rev (1m)1.41%
PT rev (3m)7.88%
EPS NQ rev (1m)-1.07%
EPS NQ rev (3m)5.08%
EPS NY rev (1m)0.85%
EPS NY rev (3m)1.81%
Revenue NQ rev (1m)0.08%
Revenue NQ rev (3m)3.02%
Revenue NY rev (1m)0.06%
Revenue NY rev (3m)0.11%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 33.15 | ||
| Fwd PE | 46.88 | ||
| P/S | 10.47 | ||
| P/FCF | 120.35 | ||
| P/OCF | 17.31 | ||
| P/B | 3.36 | ||
| P/tB | 3.36 | ||
| EV/EBITDA | 22.04 |
EPS(TTM)8.56
EY3.02%
EPS(NY)6.05
Fwd EY2.13%
FCF(TTM)2.36
FCFY0.83%
OCF(TTM)16.39
OCFY5.78%
SpS27.1
BVpS84.55
TBVpS84.55
PEG (NY)0.89
PEG (5Y)23.32
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.34% | ||
| ROE | 10.11% | ||
| ROCE | 4.35% | ||
| ROIC | 3.44% | ||
| ROICexc | 3.46% | ||
| ROICexgc | 3.46% | ||
| OM | 30.39% | ||
| PM (TTM) | 31.55% | ||
| GM | 70.83% | ||
| FCFM | 8.7% |
ROA(3y)3.45%
ROA(5y)3.64%
ROE(3y)7.59%
ROE(5y)7.86%
ROIC(3y)3.08%
ROIC(5y)3.02%
ROICexc(3y)3.12%
ROICexc(5y)3.06%
ROICexgc(3y)3.13%
ROICexgc(5y)3.06%
ROCE(3y)3.9%
ROCE(5y)3.82%
ROICexcg growth 3Y9.75%
ROICexcg growth 5Y3.86%
ROICexc growth 3Y9.73%
ROICexc growth 5Y3.85%
OM growth 3Y3.12%
OM growth 5Y-0.4%
PM growth 3Y-13.86%
PM growth 5Y-2.7%
GM growth 3Y0.17%
GM growth 5Y-0.43%
F-Score5
Asset Turnover0.14
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.17 | ||
| Debt/FCF | 42.01 | ||
| Debt/EBITDA | 5.79 | ||
| Cap/Depr | 158.32% | ||
| Cap/Sales | 51.79% | ||
| Interest Coverage | 2.5 | ||
| Cash Conversion | 95.87% | ||
| Profit Quality | 27.58% | ||
| Current Ratio | 0.4 | ||
| Quick Ratio | 0.35 | ||
| Altman-Z | 1.6 |
F-Score5
WACC7.58%
ROIC/WACC0.45
Cap/Depr(3y)58.82%
Cap/Depr(5y)81.43%
Cap/Sales(3y)20.27%
Cap/Sales(5y)27.99%
Profit Quality(3y)150.1%
Profit Quality(5y)114.11%
High Growth Momentum
Growth
EPS 1Y (TTM)5.03%
EPS 3Y3.75%
EPS 5Y1.42%
EPS Q2Q%35.29%
EPS Next Y37.14%
EPS Next 2Y-2.06%
EPS Next 3Y0.5%
EPS Next 5Y3.25%
Revenue 1Y (TTM)4.74%
Revenue growth 3Y3.73%
Revenue growth 5Y3.58%
Sales Q2Q%6.91%
Revenue Next Year5.54%
Revenue Next 2Y4.99%
Revenue Next 3Y4.64%
Revenue Next 5Y4.29%
EBIT growth 1Y-0.37%
EBIT growth 3Y6.97%
EBIT growth 5Y3.16%
EBIT Next Year113.94%
EBIT Next 3Y31.24%
EBIT Next 5Y19.92%
FCF growth 1Y-77.69%
FCF growth 3Y97.84%
FCF growth 5Y9.15%
OCF growth 1Y3.9%
OCF growth 3Y6.86%
OCF growth 5Y3.46%