LEGRAND SA (LR.PA) Stock Fundamental Analysis
Europe - Euronext Paris - EPA:LR - FR0010307819 - Common Stock
135.9 EUR
+2.85 (+2.14%)
We assign a fundamental rating of 6 out of 10 to LR. LR was compared to 75 industry peers in the Electrical Equipment industry. LR has an excellent profitability rating, but there are some minor concerns on its financial health. LR is not valued too expensively and it also shows a decent growth rate.
1. Profitability
1.1 Basic Checks
- In the past year LR was profitable.
- In the past year LR had a positive cash flow from operations.
- LR had positive earnings in each of the past 5 years.
- LR had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
- Looking at the Return On Assets, with a value of 10.51%, LR belongs to the top of the industry, outperforming 96.00% of the companies in the same industry.
- LR has a better Return On Equity (24.75%) than 88.00% of its industry peers.
- LR has a better Return On Invested Capital (13.65%) than 90.67% of its industry peers.
- The Average Return On Invested Capital over the past 3 years for LR is in line with the industry average of 9.57%.
- The 3 year average ROIC (9.18%) for LR is below the current ROIC(13.65%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 10.51% | ||
| ROE | 24.75% | ||
| ROIC | 13.65% |
ROA(3y)7.31%
ROA(5y)6.73%
ROE(3y)15.88%
ROE(5y)15.47%
ROIC(3y)9.18%
ROIC(5y)8.59%
1.3 Margins
- LR has a Profit Margin of 12.96%. This is amongst the best in the industry. LR outperforms 92.00% of its industry peers.
- LR's Profit Margin has been stable in the last couple of years.
- LR's Operating Margin of 18.98% is amongst the best of the industry. LR outperforms 92.00% of its industry peers.
- In the last couple of years the Operating Margin of LR has remained more or less at the same level.
- LR has a better Gross Margin (51.35%) than 81.33% of its industry peers.
- LR's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 18.98% | ||
| PM (TTM) | 12.96% | ||
| GM | 51.35% |
OM growth 3Y-0.39%
OM growth 5Y0.33%
PM growth 3Y1.41%
PM growth 5Y1.36%
GM growth 3Y0.53%
GM growth 5Y-0.11%
2. Health
2.1 Basic Checks
- With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), LR is creating some value.
- The number of shares outstanding for LR remains at a similar level compared to 1 year ago.
- LR has less shares outstanding than it did 5 years ago.
- Compared to 1 year ago, LR has an improved debt to assets ratio.
2.2 Solvency
- An Altman-Z score of 4.29 indicates that LR is not in any danger for bankruptcy at the moment.
- Looking at the Altman-Z score, with a value of 4.29, LR is in the better half of the industry, outperforming 77.33% of the companies in the same industry.
- LR has a debt to FCF ratio of 4.28. This is a neutral value as LR would need 4.28 years to pay back of all of its debts.
- LR has a Debt to FCF ratio of 4.28. This is in the better half of the industry: LR outperforms 66.67% of its industry peers.
- A Debt/Equity ratio of 0.78 indicates that LR is somewhat dependend on debt financing.
- LR has a Debt to Equity ratio of 0.78. This is in the lower half of the industry: LR underperforms 64.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.78 | ||
| Debt/FCF | 4.28 | ||
| Altman-Z | 4.29 |
ROIC/WACC1.58
WACC8.64%
2.3 Liquidity
- A Current Ratio of 2.22 indicates that LR has no problem at all paying its short term obligations.
- With a decent Current ratio value of 2.22, LR is doing good in the industry, outperforming 77.33% of the companies in the same industry.
- A Quick Ratio of 1.69 indicates that LR should not have too much problems paying its short term obligations.
- LR has a better Quick ratio (1.69) than 80.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.22 | ||
| Quick Ratio | 1.69 |
3. Growth
3.1 Past
- The Earnings Per Share has grown by an impressive 20.24% over the past year.
- The Earnings Per Share has been growing by 8.83% on average over the past years. This is quite good.
- LR shows a very negative growth in Revenue. In the last year, the Revenue has decreased by -17.91%.
- The Revenue has been growing slightly by 5.48% on average over the past years.
EPS 1Y (TTM)20.24%
EPS 3Y10.4%
EPS 5Y8.83%
EPS Q2Q%32.71%
Revenue 1Y (TTM)-17.91%
Revenue growth 3Y7.33%
Revenue growth 5Y5.48%
Sales Q2Q%8.84%
3.2 Future
- LR is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 7.87% yearly.
- The Revenue is expected to grow by 7.60% on average over the next years.
EPS Next Y2.61%
EPS Next 2Y7.55%
EPS Next 3Y7.81%
EPS Next 5Y7.87%
Revenue Next Year11.26%
Revenue Next 2Y10.23%
Revenue Next 3Y9.28%
Revenue Next 5Y7.6%
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.
- The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
- Based on the Price/Earnings ratio of 25.17, the valuation of LR can be described as expensive.
- Compared to the rest of the industry, the Price/Earnings ratio of LR indicates a rather cheap valuation: LR is cheaper than 81.33% of the companies listed in the same industry.
- When comparing the Price/Earnings ratio of LR to the average of the S&P500 Index (28.60), we can say LR is valued inline with the index average.
- LR is valuated rather expensively with a Price/Forward Earnings ratio of 23.04.
- 65.33% of the companies in the same industry are more expensive than LR, based on the Price/Forward Earnings ratio.
- When comparing the Price/Forward Earnings ratio of LR to the average of the S&P500 Index (25.83), we can say LR is valued inline with the index average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 25.17 | ||
| Fwd PE | 23.04 |
4.2 Price Multiples
- 74.67% of the companies in the same industry are more expensive than LR, based on the Enterprise Value to EBITDA ratio.
- 77.33% of the companies in the same industry are more expensive than LR, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 24.8 | ||
| EV/EBITDA | 12.62 |
4.3 Compensation for Growth
- The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
- LR has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)9.64
PEG (5Y)2.85
EPS Next 2Y7.55%
EPS Next 3Y7.81%
5. Dividend
5.1 Amount
- LR has a Yearly Dividend Yield of 1.75%. Purely for dividend investing, there may be better candidates out there.
- LR's Dividend Yield is rather good when compared to the industry average which is at 0.79. LR pays more dividend than 88.00% of the companies in the same industry.
- LR's Dividend Yield is comparable with the S&P500 average which is at 1.82.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.75% |
5.2 History
- The dividend of LR is nicely growing with an annual growth rate of 9.28%!
Dividend Growth(5Y)9.28%
Div Incr Years4
Div Non Decr Years6
5.3 Sustainability
- LR pays out 32.44% of its income as dividend. This is a sustainable payout ratio.
- The dividend of LR is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP32.44%
EPS Next 2Y7.55%
EPS Next 3Y7.81%
LEGRAND SA / LR.PA FAQ
Can you provide the ChartMill fundamental rating for LEGRAND SA?
ChartMill assigns a fundamental rating of 6 / 10 to LR.PA.
What is the valuation status for LR stock?
ChartMill assigns a valuation rating of 4 / 10 to LEGRAND SA (LR.PA). This can be considered as Fairly Valued.
What is the profitability of LR stock?
LEGRAND SA (LR.PA) has a profitability rating of 8 / 10.
What are the PE and PB ratios of LEGRAND SA (LR.PA) stock?
The Price/Earnings (PE) ratio for LEGRAND SA (LR.PA) is 25.17 and the Price/Book (PB) ratio is 4.97.
Can you provide the expected EPS growth for LR stock?
The Earnings per Share (EPS) of LEGRAND SA (LR.PA) is expected to grow by 2.61% in the next year.