PHILLIPS EDISON & COMPANY IN (PECO) Stock Fundamental Analysis
NASDAQ:PECO - Nasdaq - US71844V2016 - REIT - Currency: USD
PECO gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 130 industry peers in the Diversified REITs industry. While PECO has a great profitability rating, there are quite some concerns on its financial health. While showing a medium growth rate, PECO is valued expensive at the moment.
1. Profitability
1.1 Basic Checks
In the past year PECO was profitable.
PECO had a positive operating cash flow in the past year.
Each year in the past 5 years PECO has been profitable.
PECO had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
With a decent Return On Assets value of 1.24%, PECO is doing good in the industry, outperforming 62.31% of the companies in the same industry.
With a Return On Equity value of 2.70%, PECO perfoms like the industry average, outperforming 56.92% of the companies in the same industry.
The Return On Invested Capital of PECO (2.78%) is comparable to the rest of the industry.
PECO had an Average Return On Invested Capital over the past 3 years of 2.51%. This is in line with the industry average of 3.19%.
The last Return On Invested Capital (2.78%) for PECO is above the 3 year average (2.51%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.24% | ||
| ROE | 2.7% | ||
| ROIC | 2.78% |
ROA(3y)1.14%
ROA(5y)0.77%
ROE(3y)2.44%
ROE(5y)1.66%
ROIC(3y)2.51%
ROIC(5y)2.07%
1.3 Margins
Looking at the Profit Margin, with a value of 9.48%, PECO is in the better half of the industry, outperforming 60.77% of the companies in the same industry.
PECO's Profit Margin has improved in the last couple of years.
PECO's Operating Margin of 25.95% is in line compared to the rest of the industry. PECO outperforms 57.69% of its industry peers.
PECO's Operating Margin has improved in the last couple of years.
Looking at the Gross Margin, with a value of 71.22%, PECO is in the better half of the industry, outperforming 64.62% of the companies in the same industry.
In the last couple of years the Gross Margin of PECO has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 25.95% | ||
| PM (TTM) | 9.48% | ||
| GM | 71.22% |
OM growth 3Y23.39%
OM growth 5Y7%
PM growth 3Y49.54%
PM growth 5YN/A
GM growth 3Y0.43%
GM growth 5Y0.35%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so PECO is destroying value.
PECO has more shares outstanding than it did 1 year ago.
The number of shares outstanding for PECO has been increased compared to 5 years ago.
The debt/assets ratio for PECO is higher compared to a year ago.
2.2 Solvency
Based on the Altman-Z score of 0.81, we must say that PECO is in the distress zone and has some risk of bankruptcy.
PECO's Altman-Z score of 0.81 is fine compared to the rest of the industry. PECO outperforms 66.92% of its industry peers.
PECO has a debt to FCF ratio of 8.80. This is a slightly negative value and a sign of low solvency as PECO would need 8.80 years to pay back of all of its debts.
The Debt to FCF ratio of PECO (8.80) is better than 93.85% of its industry peers.
A Debt/Equity ratio of 0.91 indicates that PECO is somewhat dependend on debt financing.
The Debt to Equity ratio of PECO (0.91) is better than 61.54% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.91 | ||
| Debt/FCF | 8.8 | ||
| Altman-Z | 0.81 |
ROIC/WACC0.39
WACC7.1%
2.3 Liquidity
PECO has a Current Ratio of 0.11. This is a bad value and indicates that PECO is not financially healthy enough and could expect problems in meeting its short term obligations.
With a Current ratio value of 0.11, PECO is not doing good in the industry: 94.62% of the companies in the same industry are doing better.
PECO has a Quick Ratio of 0.11. This is a bad value and indicates that PECO is not financially healthy enough and could expect problems in meeting its short term obligations.
PECO's Quick ratio of 0.11 is on the low side compared to the rest of the industry. PECO is outperformed by 94.62% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.11 | ||
| Quick Ratio | 0.11 |
3. Growth
3.1 Past
PECO shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 106.12%, which is quite impressive.
The Earnings Per Share has been growing by 55.36% on average over the past years. This is a very strong growth
The Revenue has grown by 8.40% in the past year. This is quite good.
PECO shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 4.27% yearly.
EPS 1Y (TTM)106.12%
EPS 3Y55.36%
EPS 5YN/A
EPS Q2Q%364.29%
Revenue 1Y (TTM)8.4%
Revenue growth 3Y7.47%
Revenue growth 5Y4.27%
Sales Q2Q%10.54%
3.2 Future
Based on estimates for the next years, PECO will show a quite strong growth in Earnings Per Share. The EPS will grow by 12.88% on average per year.
The Revenue is expected to grow by 7.43% on average over the next years.
EPS Next Y22.06%
EPS Next 2Y18.64%
EPS Next 3Y12.88%
EPS Next 5YN/A
Revenue Next Year8.14%
Revenue Next 2Y7.6%
Revenue Next 3Y7.43%
Revenue Next 5YN/A
3.3 Evolution
Although the future EPS growth is still strong, it is not able to hold up the even more excellent growth rate of the past 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.
4. Valuation
4.1 Price/Earnings Ratio
PECO is valuated quite expensively with a Price/Earnings ratio of 34.86.
PECO's Price/Earnings ratio is in line with the industry average.
The average S&P500 Price/Earnings ratio is at 28.92. PECO is valued slightly more expensive when compared to this.
The Price/Forward Earnings ratio is 50.03, which means the current valuation is very expensive for PECO.
Based on the Price/Forward Earnings ratio, PECO is valued a bit cheaper than the industry average as 61.54% of the companies are valued more expensively.
The average S&P500 Price/Forward Earnings ratio is at 21.65. PECO is valued rather expensively when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 34.86 | ||
| Fwd PE | 50.03 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of PECO is on the same level as its industry peers.
75.38% of the companies in the same industry are more expensive than PECO, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 18.42 | ||
| EV/EBITDA | 15.35 |
4.3 Compensation for Growth
PECO's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
PECO has a very decent profitability rating, which may justify a higher PE ratio.
A more expensive valuation may be justified as PECO's earnings are expected to grow with 12.88% in the coming years.
PEG (NY)1.58
PEG (5Y)N/A
EPS Next 2Y18.64%
EPS Next 3Y12.88%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 3.44%, PECO has a reasonable but not impressive dividend return.
PECO's Dividend Yield is slightly below the industry average, which is at 16.86.
Compared to an average S&P500 Dividend Yield of 2.51, PECO pays a bit more dividend than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.44% |
5.2 History
The dividend of PECO decreases each year by -3.54%.
PECO has been paying a dividend for over 5 years, so it has already some track record.
PECO has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)-3.54%
Div Incr Years3
Div Non Decr Years3
5.3 Sustainability
PECO pays out 213.80% of its income as dividend. This is not a sustainable payout ratio.
DP213.8%
EPS Next 2Y18.64%
EPS Next 3Y12.88%
NASDAQ:PECO (4/25/2025, 3:38:08 PM)
35.21
-0.01 (-0.03%)
Chartmill FA Rating
GICS SectorReal Estate
GICS IndustryGroupEquity Real Estate Investment Trusts (REITs)
GICS IndustryDiversified REITs
Earnings (Last)
Earnings (Next)
Inst Owners85.72%
Inst Owner Change0.34%
Ins Owners0.54%
Ins Owner Change0.69%
Market Cap4.41B
Analysts76.47
Price Target41.03 (16.53%)
Short Float %3.17%
Short Ratio4.97
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.44% |
Yearly Dividend1.08
Dividend Growth(5Y)-3.54%
DP213.8%
Div Incr Years3
Div Non Decr Years3
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-7.67%
Min EPS beat(2)-36.21%
Max EPS beat(2)20.87%
EPS beat(4)2
Avg EPS beat(4)-6.22%
Min EPS beat(4)-36.21%
Max EPS beat(4)20.87%
EPS beat(8)6
Avg EPS beat(8)3.77%
EPS beat(12)10
Avg EPS beat(12)10.96%
EPS beat(16)N/A
Avg EPS beat(16)N/A
Revenue beat(2)1
Avg Revenue beat(2)0.27%
Min Revenue beat(2)-0.4%
Max Revenue beat(2)0.95%
Revenue beat(4)2
Avg Revenue beat(4)-0.38%
Min Revenue beat(4)-2.27%
Max Revenue beat(4)0.95%
Revenue beat(8)4
Avg Revenue beat(8)-0.1%
Revenue beat(12)8
Avg Revenue beat(12)0.54%
Revenue beat(16)N/A
Avg Revenue beat(16)N/A
PT rev (1m)0.28%
PT rev (3m)-1.45%
EPS NQ rev (1m)3.61%
EPS NQ rev (3m)6.17%
EPS NY rev (1m)4.06%
EPS NY rev (3m)5.34%
Revenue NQ rev (1m)-0.1%
Revenue NQ rev (3m)-0.33%
Revenue NY rev (1m)-0.19%
Revenue NY rev (3m)0.6%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 34.86 | ||
| Fwd PE | 50.03 | ||
| P/S | 6.67 | ||
| P/FCF | 18.42 | ||
| P/OCF | 13.19 | ||
| P/B | 1.9 | ||
| P/tB | 1.93 | ||
| EV/EBITDA | 15.35 |
EPS(TTM)1.01
EY2.87%
EPS(NY)0.7
Fwd EY2%
FCF(TTM)1.91
FCFY5.43%
OCF(TTM)2.67
OCFY7.58%
SpS5.28
BVpS18.5
TBVpS18.27
PEG (NY)1.58
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.24% | ||
| ROE | 2.7% | ||
| ROCE | 3.52% | ||
| ROIC | 2.78% | ||
| ROICexc | 2.78% | ||
| ROICexgc | 2.82% | ||
| OM | 25.95% | ||
| PM (TTM) | 9.48% | ||
| GM | 71.22% | ||
| FCFM | 36.23% |
ROA(3y)1.14%
ROA(5y)0.77%
ROE(3y)2.44%
ROE(5y)1.66%
ROIC(3y)2.51%
ROIC(5y)2.07%
ROICexc(3y)2.52%
ROICexc(5y)2.08%
ROICexgc(3y)2.56%
ROICexgc(5y)2.12%
ROCE(3y)3.18%
ROCE(5y)2.62%
ROICexcg growth 3Y28.89%
ROICexcg growth 5Y10.24%
ROICexc growth 3Y28.89%
ROICexc growth 5Y10.67%
OM growth 3Y23.39%
OM growth 5Y7%
PM growth 3Y49.54%
PM growth 5YN/A
GM growth 3Y0.43%
GM growth 5Y0.35%
F-Score5
Asset Turnover0.13
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.91 | ||
| Debt/FCF | 8.8 | ||
| Debt/EBITDA | 4.97 | ||
| Cap/Depr | 37.59% | ||
| Cap/Sales | 14.38% | ||
| Interest Coverage | 2.29 | ||
| Cash Conversion | 78.82% | ||
| Profit Quality | 382.24% | ||
| Current Ratio | 0.11 | ||
| Quick Ratio | 0.11 | ||
| Altman-Z | 0.81 |
F-Score5
WACC7.1%
ROIC/WACC0.39
Cap/Depr(3y)40.7%
Cap/Depr(5y)36.89%
Cap/Sales(3y)16.05%
Cap/Sales(5y)15.02%
Profit Quality(3y)370.81%
Profit Quality(5y)1082.19%
High Growth Momentum
Growth
EPS 1Y (TTM)106.12%
EPS 3Y55.36%
EPS 5YN/A
EPS Q2Q%364.29%
EPS Next Y22.06%
EPS Next 2Y18.64%
EPS Next 3Y12.88%
EPS Next 5YN/A
Revenue 1Y (TTM)8.4%
Revenue growth 3Y7.47%
Revenue growth 5Y4.27%
Sales Q2Q%10.54%
Revenue Next Year8.14%
Revenue Next 2Y7.6%
Revenue Next 3Y7.43%
Revenue Next 5YN/A
EBIT growth 1Y10.55%
EBIT growth 3Y32.61%
EBIT growth 5Y11.56%
EBIT Next Year168.03%
EBIT Next 3Y46.21%
EBIT Next 5YN/A
FCF growth 1Y22.43%
FCF growth 3Y8.44%
FCF growth 5Y12.26%
OCF growth 1Y15.03%
OCF growth 3Y8.38%
OCF growth 5Y8.09%