PEARSON PLC (PES.DE) Stock Fundamental Analysis
Europe - Frankfurt Stock Exchange - FRA:PES - GB0006776081 - Common Stock
11.27 EUR
-0.03 (-0.22%)
Taking everything into account, PES scores 6 out of 10 in our fundamental rating. PES was compared to 4 industry peers in the Diversified Consumer Services industry. PES gets an excellent profitability rating and is at the same time showing great financial health properties. PES has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
In the past year PES was profitable.
In the past year PES had a positive cash flow from operations.
PES had positive earnings in each of the past 5 years.
PES had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
PES has a Return On Assets of 7.08%. This is amongst the best in the industry. PES outperforms 100.00% of its industry peers.
PES's Return On Equity of 12.29% is amongst the best of the industry. PES outperforms 100.00% of its industry peers.
With a decent Return On Invested Capital value of 8.65%, PES is doing good in the industry, outperforming 75.00% of the companies in the same industry.
PES had an Average Return On Invested Capital over the past 3 years of 6.70%. This is below the industry average of 8.77%.
The 3 year average ROIC (6.70%) for PES is below the current ROIC(8.65%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.08% | ||
| ROE | 12.29% | ||
| ROIC | 8.65% |
ROA(3y)5.07%
ROA(5y)4.41%
ROE(3y)8.59%
ROE(5y)7.58%
ROIC(3y)6.7%
ROIC(5y)5.84%
1.3 Margins
PES has a better Profit Margin (12.53%) than 100.00% of its industry peers.
In the last couple of years the Profit Margin of PES has grown nicely.
With an excellent Operating Margin value of 15.77%, PES belongs to the best of the industry, outperforming 100.00% of the companies in the same industry.
In the last couple of years the Operating Margin of PES has grown nicely.
Looking at the Gross Margin, with a value of 51.45%, PES is in the better half of the industry, outperforming 75.00% of the companies in the same industry.
PES's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 15.77% | ||
| PM (TTM) | 12.53% | ||
| GM | 51.45% |
OM growth 3Y25.2%
OM growth 5Y6.89%
PM growth 3Y33.26%
PM growth 5Y12.36%
GM growth 3Y1.31%
GM growth 5Y-0.38%
2. Health
2.1 Basic Checks
PES has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
The number of shares outstanding for PES has been reduced compared to 1 year ago.
The number of shares outstanding for PES has been reduced compared to 5 years ago.
PES has a worse debt/assets ratio than last year.
2.2 Solvency
An Altman-Z score of 2.72 indicates that PES is not a great score, but indicates only limited risk for bankruptcy at the moment.
PES's Altman-Z score of 2.72 is fine compared to the rest of the industry. PES outperforms 75.00% of its industry peers.
PES has a debt to FCF ratio of 2.42. This is a good value and a sign of high solvency as PES would need 2.42 years to pay back of all of its debts.
The Debt to FCF ratio of PES (2.42) is better than 75.00% of its industry peers.
PES has a Debt/Equity ratio of 0.40. This is a healthy value indicating a solid balance between debt and equity.
With a decent Debt to Equity ratio value of 0.40, PES is doing good in the industry, outperforming 75.00% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.4 | ||
| Debt/FCF | 2.42 | ||
| Altman-Z | 2.72 |
ROIC/WACC0.95
WACC9.12%
2.3 Liquidity
PES has a Current Ratio of 2.31. This indicates that PES is financially healthy and has no problem in meeting its short term obligations.
PES's Current ratio of 2.31 is amongst the best of the industry. PES outperforms 100.00% of its industry peers.
A Quick Ratio of 2.24 indicates that PES has no problem at all paying its short term obligations.
The Quick ratio of PES (2.24) is better than 100.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.31 | ||
| Quick Ratio | 2.24 |
3. Growth
3.1 Past
PES shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 3.29%.
Measured over the past 5 years, PES shows a small growth in Earnings Per Share. The EPS has been growing by 1.15% on average per year.
The Revenue has decreased by -0.82% in the past year.
PES shows a decrease in Revenue. Measured over the last years, the Revenue has been decreasing by -1.70% yearly.
EPS 1Y (TTM)3.29%
EPS 3Y20.87%
EPS 5Y1.15%
EPS Q2Q%-5.47%
Revenue 1Y (TTM)-0.82%
Revenue growth 3Y1.19%
Revenue growth 5Y-1.7%
Sales Q2Q%-1.82%
3.2 Future
The Earnings Per Share is expected to grow by 8.36% on average over the next years. This is quite good.
PES is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 3.06% yearly.
EPS Next Y3.45%
EPS Next 2Y7.01%
EPS Next 3Y8.36%
EPS Next 5YN/A
Revenue Next Year-0.33%
Revenue Next 2Y2.35%
Revenue Next 3Y3.06%
Revenue Next 5YN/A
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 accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 16.57 indicates a correct valuation of PES.
Compared to the rest of the industry, the Price/Earnings ratio of PES indicates a rather cheap valuation: PES is cheaper than 100.00% of the companies listed in the same industry.
The average S&P500 Price/Earnings ratio is at 25.45. PES is valued slightly cheaper when compared to this.
The Price/Forward Earnings ratio is 14.20, which indicates a correct valuation of PES.
Based on the Price/Forward Earnings ratio, PES is valued a bit cheaper than 75.00% of the companies in the same industry.
PES is valuated cheaply when we compare the Price/Forward Earnings ratio to 34.46, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 16.57 | ||
| Fwd PE | 14.2 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of PES indicates a somewhat cheap valuation: PES is cheaper than 75.00% of the companies listed in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of PES indicates a somewhat cheap valuation: PES is cheaper than 75.00% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 10.29 | ||
| EV/EBITDA | 9.67 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates PES does not grow enough to justify the current Price/Earnings ratio.
PES has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)4.8
PEG (5Y)14.39
EPS Next 2Y7.01%
EPS Next 3Y8.36%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 2.40%, PES has a reasonable but not impressive dividend return.
PES's Dividend Yield is a higher than the industry average which is at 3.94.
PES's Dividend Yield is comparable with the S&P500 average which is at 2.45.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.4% |
5.2 History
The dividend of PES has a limited annual growth rate of 4.00%.
Dividend Growth(5Y)4%
Div Incr Years4
Div Non Decr Years4
5.3 Sustainability
PES pays out 36.05% of its income as dividend. This is a sustainable payout ratio.
PES's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP36.05%
EPS Next 2Y7.01%
EPS Next 3Y8.36%
FRA:PES (11/20/2025, 7:00:00 PM)
11.27
-0.03 (-0.22%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Services
GICS IndustryDiversified Consumer Services
Earnings (Last)
Earnings (Next)
Inst Owners77.62%
Inst Owner ChangeN/A
Ins Owners0.2%
Ins Owner ChangeN/A
Market Cap7.19B
Revenue(TTM)3.52B
Net Income(TTM)441.00M
Analysts68.57
Price Target14.56 (29.19%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.4% |
Yearly Dividend0.26
Dividend Growth(5Y)4%
DP36.05%
Div Incr Years4
Div Non Decr Years4
Ex-DateN/A
Surprises & Revisions
EPS beat(2)N/A
Avg EPS beat(2)N/A
Min EPS beat(2)N/A
Max EPS beat(2)N/A
EPS beat(4)N/A
Avg EPS beat(4)N/A
Min EPS beat(4)N/A
Max EPS beat(4)N/A
EPS beat(8)N/A
Avg EPS beat(8)N/A
EPS beat(12)N/A
Avg EPS beat(12)N/A
EPS beat(16)N/A
Avg EPS beat(16)N/A
Revenue beat(2)N/A
Avg Revenue beat(2)N/A
Min Revenue beat(2)N/A
Max Revenue beat(2)N/A
Revenue beat(4)N/A
Avg Revenue beat(4)N/A
Min Revenue beat(4)N/A
Max Revenue beat(4)N/A
Revenue beat(8)N/A
Avg Revenue beat(8)N/A
Revenue beat(12)N/A
Avg Revenue beat(12)N/A
Revenue beat(16)N/A
Avg Revenue beat(16)N/A
PT rev (1m)0.62%
PT rev (3m)-0.07%
EPS NQ rev (1m)N/A
EPS NQ rev (3m)N/A
EPS NY rev (1m)-0.22%
EPS NY rev (3m)-5.56%
Revenue NQ rev (1m)N/A
Revenue NQ rev (3m)N/A
Revenue NY rev (1m)-0.14%
Revenue NY rev (3m)-0.58%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 16.57 | ||
| Fwd PE | 14.2 | ||
| P/S | 1.8 | ||
| P/FCF | 10.29 | ||
| P/OCF | 8.52 | ||
| P/B | 1.77 | ||
| P/tB | 8.13 | ||
| EV/EBITDA | 9.67 |
EPS(TTM)0.68
EY6.03%
EPS(NY)0.79
Fwd EY7.04%
FCF(TTM)1.09
FCFY9.71%
OCF(TTM)1.32
OCFY11.73%
SpS6.26
BVpS6.38
TBVpS1.39
PEG (NY)4.8
PEG (5Y)14.39
Graham Number9.88
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.08% | ||
| ROE | 12.29% | ||
| ROCE | 10.65% | ||
| ROIC | 8.65% | ||
| ROICexc | 9.26% | ||
| ROICexgc | 21.92% | ||
| OM | 15.77% | ||
| PM (TTM) | 12.53% | ||
| GM | 51.45% | ||
| FCFM | 17.5% |
ROA(3y)5.07%
ROA(5y)4.41%
ROE(3y)8.59%
ROE(5y)7.58%
ROIC(3y)6.7%
ROIC(5y)5.84%
ROICexc(3y)7.48%
ROICexc(5y)7.31%
ROICexgc(3y)20.27%
ROICexgc(5y)22.68%
ROCE(3y)8.26%
ROCE(5y)7.2%
ROICexgc growth 3Y7.27%
ROICexgc growth 5Y10.63%
ROICexc growth 3Y17.53%
ROICexc growth 5Y6.81%
OM growth 3Y25.2%
OM growth 5Y6.89%
PM growth 3Y33.26%
PM growth 5Y12.36%
GM growth 3Y1.31%
GM growth 5Y-0.38%
F-Score8
Asset Turnover0.57
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.4 | ||
| Debt/FCF | 2.42 | ||
| Debt/EBITDA | 1.84 | ||
| Cap/Depr | 58.45% | ||
| Cap/Sales | 3.64% | ||
| Interest Coverage | 10.09 | ||
| Cash Conversion | 96.12% | ||
| Profit Quality | 139.68% | ||
| Current Ratio | 2.31 | ||
| Quick Ratio | 2.24 | ||
| Altman-Z | 2.72 |
F-Score8
WACC9.12%
ROIC/WACC0.95
Cap/Depr(3y)49.36%
Cap/Depr(5y)46.7%
Cap/Sales(3y)3.58%
Cap/Sales(5y)3.97%
Profit Quality(3y)103.3%
Profit Quality(5y)94.38%
High Growth Momentum
Growth
EPS 1Y (TTM)3.29%
EPS 3Y20.87%
EPS 5Y1.15%
EPS Q2Q%-5.47%
EPS Next Y3.45%
EPS Next 2Y7.01%
EPS Next 3Y8.36%
EPS Next 5YN/A
Revenue 1Y (TTM)-0.82%
Revenue growth 3Y1.19%
Revenue growth 5Y-1.7%
Sales Q2Q%-1.82%
Revenue Next Year-0.33%
Revenue Next 2Y2.35%
Revenue Next 3Y3.06%
Revenue Next 5YN/A
EBIT growth 1Y9.47%
EBIT growth 3Y26.69%
EBIT growth 5Y5.08%
EBIT Next Year36.45%
EBIT Next 3Y14.89%
EBIT Next 5YN/A
FCF growth 1Y133.33%
FCF growth 3Y49.68%
FCF growth 5Y23.37%
OCF growth 1Y82.8%
OCF growth 3Y24.36%
OCF growth 5Y11.19%
PEARSON PLC / PES.DE FAQ
What is the ChartMill fundamental rating of PEARSON PLC (PES.DE) stock?
ChartMill assigns a fundamental rating of 6 / 10 to PES.DE.
What is the valuation status for PES stock?
ChartMill assigns a valuation rating of 6 / 10 to PEARSON PLC (PES.DE). This can be considered as Fairly Valued.
Can you provide the profitability details for PEARSON PLC?
PEARSON PLC (PES.DE) has a profitability rating of 8 / 10.
What is the financial health of PEARSON PLC (PES.DE) stock?
The financial health rating of PEARSON PLC (PES.DE) is 7 / 10.
What is the expected EPS growth for PEARSON PLC (PES.DE) stock?
The Earnings per Share (EPS) of PEARSON PLC (PES.DE) is expected to grow by 3.45% in the next year.