ESSEX PROPERTY TRUST INC (ESS) Stock Fundamental Analysis
NYSE:ESS - New York Stock Exchange, Inc. - US2971781057 - REIT - Currency: USD
Taking everything into account, ESS scores 4 out of 10 in our fundamental rating. ESS was compared to 20 industry peers in the Residential REITs industry. ESS has an excellent profitability rating, but there are concerns on its financial health. ESS has a expensive valuation and it also scores bad on growth.
1. Profitability
1.1 Basic Checks
In the past year ESS was profitable.
In the past year ESS had a positive cash flow from operations.
In the past 5 years ESS has always been profitable.
Each year in the past 5 years ESS had a positive operating cash flow.
1.2 Ratios
The Return On Assets of ESS (5.10%) is better than 90.00% of its industry peers.
With an excellent Return On Equity value of 12.06%, ESS belongs to the best of the industry, outperforming 95.00% of the companies in the same industry.
With a decent Return On Invested Capital value of 3.36%, ESS is doing good in the industry, outperforming 80.00% of the companies in the same industry.
ESS had an Average Return On Invested Capital over the past 3 years of 3.38%. This is in line with the industry average of 2.62%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.1% | ||
| ROE | 12.06% | ||
| ROIC | 3.36% |
ROA(3y)4.11%
ROA(5y)4.1%
ROE(3y)9.34%
ROE(5y)9.13%
ROIC(3y)3.38%
ROIC(5y)3.06%
1.3 Margins
The Profit Margin of ESS (37.08%) is better than 95.00% of its industry peers.
In the last couple of years the Profit Margin of ESS has grown nicely.
Looking at the Operating Margin, with a value of 29.84%, ESS belongs to the top of the industry, outperforming 90.00% of the companies in the same industry.
ESS's Operating Margin has declined in the last couple of years.
With an excellent Gross Margin value of 70.63%, ESS belongs to the best of the industry, outperforming 95.00% of the companies in the same industry.
ESS's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 29.84% | ||
| PM (TTM) | 37.08% | ||
| GM | 70.63% |
OM growth 3Y3.42%
OM growth 5Y-2.45%
PM growth 3Y7.21%
PM growth 5Y6.79%
GM growth 3Y0.78%
GM growth 5Y-0.57%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), ESS is destroying value.
Compared to 1 year ago, ESS has about the same amount of shares outstanding.
ESS has less shares outstanding than it did 5 years ago.
ESS has a worse debt/assets ratio than last year.
2.2 Solvency
Based on the Altman-Z score of 1.58, we must say that ESS is in the distress zone and has some risk of bankruptcy.
Looking at the Altman-Z score, with a value of 1.58, ESS is in the better half of the industry, outperforming 70.00% of the companies in the same industry.
ESS has a Debt/Equity ratio of 1.22. This is a high value indicating a heavy dependency on external financing.
Looking at the Debt to Equity ratio, with a value of 1.22, ESS is in line with its industry, outperforming 45.00% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.22 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 1.58 |
ROIC/WACC0.46
WACC7.37%
2.3 Liquidity
A Current Ratio of 0.64 indicates that ESS may have some problems paying its short term obligations.
The Current ratio of ESS (0.64) is better than 65.00% of its industry peers.
A Quick Ratio of 0.44 indicates that ESS may have some problems paying its short term obligations.
ESS has a Quick ratio (0.44) which is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.64 | ||
| Quick Ratio | 0.44 |
3. Growth
3.1 Past
ESS shows a slight negative growth in Earnings Per Share. In the last year, the EPS has decreased by -5.62%.
ESS shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 5.66% yearly.
Looking at the last year, ESS shows a small growth in Revenue. The Revenue has grown by 7.61% in the last year.
Measured over the past years, ESS shows a small growth in Revenue. The Revenue has been growing by 3.98% on average per year.
EPS 1Y (TTM)-5.62%
EPS 3Y5.47%
EPS 5Y5.66%
EPS Q2Q%-25.65%
Revenue 1Y (TTM)7.61%
Revenue growth 3Y7.2%
Revenue growth 5Y3.98%
Sales Q2Q%8.24%
3.2 Future
Based on estimates for the next years, ESS will show a decrease in Earnings Per Share. The EPS will decrease by -4.22% on average per year.
The Revenue is expected to grow by 3.99% on average over the next years.
EPS Next Y-24.45%
EPS Next 2Y-16.79%
EPS Next 3Y-8.75%
EPS Next 5Y-4.22%
Revenue Next Year6.52%
Revenue Next 2Y5.18%
Revenue Next 3Y4.63%
Revenue Next 5Y3.99%
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.
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
A Price/Earnings ratio of 36.81 indicates a quite expensive valuation of ESS.
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 valuation a bit more expensive than the S&P500 average which is at 27.45.
ESS is valuated quite expensively with a Price/Forward Earnings ratio of 46.59.
Based on the Price/Forward Earnings ratio, ESS is valued a bit cheaper than the industry average as 80.00% of the companies are valued more expensively.
Compared to an average S&P500 Price/Forward Earnings ratio of 21.90, ESS is valued quite expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 36.81 | ||
| Fwd PE | 46.59 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, ESS is valued expensively inside the industry as 80.00% of the companies are valued cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 22.06 |
4.3 Compensation for Growth
ESS has an outstanding profitability rating, which may justify a higher PE ratio.
ESS's earnings are expected to decrease with -8.75% in the coming years. This may justify a cheaper valuation.
PEG (NY)N/A
PEG (5Y)6.5
EPS Next 2Y-16.79%
EPS Next 3Y-8.75%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 3.62%, ESS has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 4.69, ESS is paying slightly less dividend.
Compared to an average S&P500 Dividend Yield of 2.38, ESS pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.62% |
5.2 History
The dividend of ESS has a limited annual growth rate of 4.65%.
ESS has been paying a dividend for at least 10 years, so it has a reliable track record.
The dividend of ESS decreased recently.
Dividend Growth(5Y)4.65%
Div Incr Years1
Div Non Decr Years1
5.3 Sustainability
93.74% of the earnings are spent on dividend by ESS. This is not a sustainable payout ratio.
ESS's earnings are declining while the Dividend Rate has been growing. This means the dividend growth is most likely not sustainable.
DP93.74%
EPS Next 2Y-16.79%
EPS Next 3Y-8.75%
284.2
+0.8 (+0.28%)
Chartmill FA Rating
GICS SectorReal Estate
GICS IndustryGroupEquity Real Estate Investment Trusts (REITs)
GICS IndustryResidential REITs
Earnings (Last)
Earnings (Next)
Inst Owners100.44%
Inst Owner Change6.46%
Ins Owners1.14%
Ins Owner Change5.41%
Market Cap18.28B
Analysts67.74
Price Target316.13 (11.24%)
Short Float %2.44%
Short Ratio3.42
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.62% |
Yearly Dividend9.66
Dividend Growth(5Y)4.65%
DP93.74%
Div Incr Years1
Div Non Decr Years1
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)57%
Min EPS beat(2)-9.12%
Max EPS beat(2)123.13%
EPS beat(4)3
Avg EPS beat(4)38.29%
Min EPS beat(4)-9.12%
Max EPS beat(4)123.13%
EPS beat(8)5
Avg EPS beat(8)44.22%
EPS beat(12)8
Avg EPS beat(12)41.86%
EPS beat(16)11
Avg EPS beat(16)42.7%
Revenue beat(2)0
Avg Revenue beat(2)-0.62%
Min Revenue beat(2)-0.85%
Max Revenue beat(2)-0.4%
Revenue beat(4)1
Avg Revenue beat(4)-0.02%
Min Revenue beat(4)-0.85%
Max Revenue beat(4)1.43%
Revenue beat(8)2
Avg Revenue beat(8)-0.31%
Revenue beat(12)4
Avg Revenue beat(12)-0.24%
Revenue beat(16)6
Avg Revenue beat(16)-0.09%
PT rev (1m)-0.15%
PT rev (3m)-0.54%
EPS NQ rev (1m)-0.21%
EPS NQ rev (3m)-2.96%
EPS NY rev (1m)3.05%
EPS NY rev (3m)10.77%
Revenue NQ rev (1m)-0.06%
Revenue NQ rev (3m)0.85%
Revenue NY rev (1m)-0.16%
Revenue NY rev (3m)0.69%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 36.81 | ||
| Fwd PE | 46.59 | ||
| P/S | 10.09 | ||
| P/FCF | N/A | ||
| P/OCF | 17.67 | ||
| P/B | 3.28 | ||
| P/tB | 3.28 | ||
| EV/EBITDA | 22.06 |
EPS(TTM)7.72
EY2.72%
EPS(NY)6.1
Fwd EY2.15%
FCF(TTM)-1.78
FCFYN/A
OCF(TTM)16.09
OCFY5.66%
SpS28.17
BVpS86.58
TBVpS86.58
PEG (NY)N/A
PEG (5Y)6.5
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.1% | ||
| ROE | 12.06% | ||
| ROCE | 4.26% | ||
| ROIC | 3.36% | ||
| ROICexc | 3.39% | ||
| ROICexgc | 3.39% | ||
| OM | 29.84% | ||
| PM (TTM) | 37.08% | ||
| GM | 70.63% | ||
| FCFM | N/A |
ROA(3y)4.11%
ROA(5y)4.1%
ROE(3y)9.34%
ROE(5y)9.13%
ROIC(3y)3.38%
ROIC(5y)3.06%
ROICexc(3y)3.43%
ROICexc(5y)3.09%
ROICexgc(3y)3.43%
ROICexgc(5y)3.09%
ROCE(3y)4.28%
ROCE(5y)3.87%
ROICexcg growth 3Y11.24%
ROICexcg growth 5Y1.13%
ROICexc growth 3Y11.22%
ROICexc growth 5Y1.11%
OM growth 3Y3.42%
OM growth 5Y-2.45%
PM growth 3Y7.21%
PM growth 5Y6.79%
GM growth 3Y0.78%
GM growth 5Y-0.57%
F-Score5
Asset Turnover0.14
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.22 | ||
| Debt/FCF | N/A | ||
| Debt/EBITDA | 6 | ||
| Cap/Depr | 194.3% | ||
| Cap/Sales | 63.42% | ||
| Interest Coverage | 2.39 | ||
| Cash Conversion | 91.39% | ||
| Profit Quality | N/A | ||
| Current Ratio | 0.64 | ||
| Quick Ratio | 0.44 | ||
| Altman-Z | 1.58 |
F-Score5
WACC7.37%
ROIC/WACC0.46
Cap/Depr(3y)100.16%
Cap/Depr(5y)101.9%
Cap/Sales(3y)32.94%
Cap/Sales(5y)34.6%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-5.62%
EPS 3Y5.47%
EPS 5Y5.66%
EPS Q2Q%-25.65%
EPS Next Y-24.45%
EPS Next 2Y-16.79%
EPS Next 3Y-8.75%
EPS Next 5Y-4.22%
Revenue 1Y (TTM)7.61%
Revenue growth 3Y7.2%
Revenue growth 5Y3.98%
Sales Q2Q%8.24%
Revenue Next Year6.52%
Revenue Next 2Y5.18%
Revenue Next 3Y4.63%
Revenue Next 5Y3.99%
EBIT growth 1Y1.99%
EBIT growth 3Y10.86%
EBIT growth 5Y1.43%
EBIT Next Year136.36%
EBIT Next 3Y35.97%
EBIT Next 5Y26.8%
FCF growth 1Y-118.13%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y10.39%
OCF growth 3Y5.68%
OCF growth 5Y3.05%