We assign a fundamental rating of 7 out of 10 to EW. EW was compared to 184 industry peers in the Health Care Equipment & Supplies industry. EW has outstanding health and profitabily ratings, belonging to the best of the industry. This is a solid base for any company. EW has a decent growth rate and is not valued too expensively. With these ratings, EW could be worth investigating further for quality investing!.

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1. Profitability

2. Health

3. Growth

4. Valuation

5. Dividend

1. Profitability

1.1 Basic Checks

In the past year EW was profitable.
In the past year EW had a positive cash flow from operations.
EW had positive earnings in each of the past 5 years.
In the past 5 years EW always reported a positive cash flow from operatings.

1.2 Ratios

EW's Return On Assets of 10.31% is amongst the best of the industry. EW outperforms 94.57% of its industry peers.
EW has a better Return On Equity (13.40%) than 89.13% of its industry peers.
With an excellent Return On Invested Capital value of 12.50%, EW belongs to the best of the industry, outperforming 92.93% of the companies in the same industry.
EW had an Average Return On Invested Capital over the past 3 years of 15.82%. This is significantly above the industry average of 8.81%.

		Industry Rank	Sector Rank
ROA	10.31%
ROE	13.4%
ROIC	12.5%

ROA(3y)21.77%

ROA(5y)18.87%

ROE(3y)29.68%

ROE(5y)26.56%

ROIC(3y)15.82%

ROIC(5y)17.27%

1.3 Margins

With an excellent Profit Margin value of 23.25%, EW belongs to the best of the industry, outperforming 95.11% of the companies in the same industry.
In the last couple of years the Profit Margin of EW has grown nicely.
Looking at the Operating Margin, with a value of 27.73%, EW belongs to the top of the industry, outperforming 96.20% of the companies in the same industry.
EW's Operating Margin has been stable in the last couple of years.
With an excellent Gross Margin value of 78.19%, EW belongs to the best of the industry, outperforming 90.76% of the companies in the same industry.
EW's Gross Margin has been stable in the last couple of years.

		Industry Rank	Sector Rank
OM	27.73%
PM (TTM)	23.25%
GM	78.19%

OM growth 3Y-5.94%

OM growth 5Y-1.04%

PM growth 3Y38.76%

PM growth 5Y26.09%

GM growth 3Y1.43%

GM growth 5Y1.33%

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ROA

ROE

ROIC

Operating and Profit Margin

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2. Health

2.1 Basic Checks

With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), EW is creating some value.
Compared to 1 year ago, EW has less shares outstanding
The number of shares outstanding for EW has been reduced compared to 5 years ago.
EW has a better debt/assets ratio than last year.

2.2 Solvency

An Altman-Z score of 12.34 indicates that EW is not in any danger for bankruptcy at the moment.
EW has a better Altman-Z score (12.34) than 90.76% of its industry peers.
EW has a debt to FCF ratio of 0.75. This is a very positive value and a sign of high solvency as it would only need 0.75 years to pay back of all of its debts.
With an excellent Debt to FCF ratio value of 0.75, EW belongs to the best of the industry, outperforming 90.76% of the companies in the same industry.
A Debt/Equity ratio of 0.06 indicates that EW is not too dependend on debt financing.
Looking at the Debt to Equity ratio, with a value of 0.06, EW is in the better half of the industry, outperforming 67.39% of the companies in the same industry.

		Industry Rank	Sector Rank
Debt/Equity	0.06
Debt/FCF	0.75
Altman-Z	12.34

ROIC/WACC1.25

WACC9.97%

2.3 Liquidity

A Current Ratio of 4.00 indicates that EW has no problem at all paying its short term obligations.
The Current ratio of EW (4.00) is better than 69.02% of its industry peers.
A Quick Ratio of 3.29 indicates that EW has no problem at all paying its short term obligations.
EW has a better Quick ratio (3.29) than 69.02% of its industry peers.

		Industry Rank	Sector Rank
Current Ratio	4
Quick Ratio	3.29

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WACC

Debt/Equity

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Altman-Z score

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3. Growth

3.1 Past

The earnings per share for EW have decreased by -3.75% in the last year.
Measured over the past 5 years, EW shows a small growth in Earnings Per Share. The EPS has been growing by 7.13% on average per year.
Looking at the last year, EW shows a small growth in Revenue. The Revenue has grown by 4.67% in the last year.
The Revenue has been growing slightly by 4.58% on average over the past years.

EPS 1Y (TTM)-3.75%

EPS 3Y5.52%

EPS 5Y7.13%

EPS Q2Q%0%

Revenue 1Y (TTM)4.67%

Revenue growth 3Y1.3%

Revenue growth 5Y4.58%

Sales Q2Q%14.67%

3.2 Future

The Earnings Per Share is expected to grow by 9.40% on average over the next years. This is quite good.
Based on estimates for the next years, EW will show a quite strong growth in Revenue. The Revenue will grow by 8.47% on average per year.

EPS Next Y1.27%

EPS Next 2Y6.3%

EPS Next 3Y7.79%

EPS Next 5Y9.4%

Revenue Next Year4.63%

Revenue Next 2Y7.15%

Revenue Next 3Y8.06%

Revenue Next 5Y8.47%

3.3 Evolution

The EPS growth rate is accelerating: in the next years the growth will be better 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 accelerating.

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4. Valuation

4.1 Price/Earnings Ratio

The Price/Earnings ratio is 32.53, which means the current valuation is very expensive for EW.
73.37% of the companies in the same industry are more expensive than EW, based on the Price/Earnings ratio.
EW is valuated at similar levels of the S&P average when we compare the Price/Earnings ratio to 28.87, which is the current average of the S&P500 Index.
With a Price/Forward Earnings ratio of 28.24, EW can be considered very expensive at the moment.
73.91% of the companies in the same industry are more expensive than EW, based on the Price/Forward Earnings ratio.
The average S&P500 Price/Forward Earnings ratio is at 25.96. EW is around the same levels.

		Industry Rank	Sector Rank
PE	32.53
Fwd PE	28.24

4.2 Price Multiples

Based on the Enterprise Value to EBITDA ratio, EW is valued a bit cheaper than 72.83% of the companies in the same industry.
71.20% of the companies in the same industry are more expensive than EW, based on the Price/Free Cash Flow ratio.

		Industry Rank	Sector Rank
P/FCF	60.67
EV/EBITDA	24.89

4.3 Compensation for Growth

The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates EW does not grow enough to justify the current Price/Earnings ratio.
The excellent profitability rating of EW may justify a higher PE ratio.