ESTEE LAUDER COMPANIES-CL A (EL) Stock Fundamental Analysis
NYSE:EL - New York Stock Exchange, Inc. - US5184391044 - Common Stock - Currency: USD
Overall EL gets a fundamental rating of 3 out of 10. We evaluated EL against 35 industry peers in the Personal Care Products industry. While EL is still in line with the averages on profitability rating, there are concerns on its financial health. EL is valied quite expensively at the moment, while it does show a decent growth rate.
1. Profitability
1.1 Basic Checks
EL had positive earnings in the past year.
EL had a positive operating cash flow in the past year.
Each year in the past 5 years EL has been profitable.
In the past 5 years EL always reported a positive cash flow from operatings.
1.2 Ratios
The Return On Assets of EL (-4.38%) is worse than 68.57% of its industry peers.
With a Return On Equity value of -20.05%, EL is not doing good in the industry: 65.71% of the companies in the same industry are doing better.
The Return On Invested Capital of EL (5.60%) is comparable to the rest of the industry.
Measured over the past 3 years, the Average Return On Invested Capital for EL is significantly below the industry average of 15.14%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -4.38% | ||
| ROE | -20.05% | ||
| ROIC | 5.6% |
ROA(3y)5.84%
ROA(5y)6.89%
ROE(3y)22.7%
ROE(5y)26.57%
ROIC(3y)9.14%
ROIC(5y)9.86%
1.3 Margins
EL's Profit Margin has declined in the last couple of years.
Looking at the Operating Margin, with a value of 9.03%, EL is in the better half of the industry, outperforming 62.86% of the companies in the same industry.
In the last couple of years the Operating Margin of EL has declined.
EL's Gross Margin of 73.85% is fine compared to the rest of the industry. EL outperforms 80.00% of its industry peers.
EL's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 9.03% | ||
| PM (TTM) | N/A | ||
| GM | 73.85% |
OM growth 3Y-18.75%
OM growth 5Y-10.71%
PM growth 3Y-47.93%
PM growth 5Y-26.95%
GM growth 3Y-2.09%
GM growth 5Y-1.48%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), EL is creating some value.
EL has more shares outstanding than it did 1 year ago.
EL has less shares outstanding than it did 5 years ago.
EL has a worse debt/assets ratio than last year.
2.2 Solvency
EL has an Altman-Z score of 3.15. This indicates that EL is financially healthy and has little risk of bankruptcy at the moment.
EL has a Altman-Z score (3.15) which is in line with its industry peers.
The Debt to FCF ratio of EL is 7.70, which is on the high side as it means it would take EL, 7.70 years of fcf income to pay off all of its debts.
EL has a Debt to FCF ratio (7.70) which is comparable to the rest of the industry.
A Debt/Equity ratio of 1.68 is on the high side and indicates that EL has dependencies on debt financing.
The Debt to Equity ratio of EL (1.68) is worse than 80.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.68 | ||
| Debt/FCF | 7.7 | ||
| Altman-Z | 3.15 |
ROIC/WACC0.72
WACC7.8%
2.3 Liquidity
A Current Ratio of 1.41 indicates that EL should not have too much problems paying its short term obligations.
Looking at the Current ratio, with a value of 1.41, EL is doing worse than 60.00% of the companies in the same industry.
EL has a Quick Ratio of 1.02. This is a normal value and indicates that EL is financially healthy and should not expect problems in meeting its short term obligations.
Looking at the Quick ratio, with a value of 1.02, EL is in line with its industry, outperforming 45.71% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.41 | ||
| Quick Ratio | 1.02 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 0.99% over the past year.
The earnings per share for EL have been decreasing by -13.41% on average. This is quite bad
Looking at the last year, EL shows a decrease in Revenue. The Revenue has decreased by -3.76% in the last year.
Measured over the past years, EL shows a small growth in Revenue. The Revenue has been growing by 0.98% on average per year.
EPS 1Y (TTM)0.99%
EPS 3Y-26.13%
EPS 5Y-13.41%
EPS Q2Q%-32.99%
Revenue 1Y (TTM)-3.76%
Revenue growth 3Y-1.26%
Revenue growth 5Y0.98%
Sales Q2Q%-9.9%
3.2 Future
The Earnings Per Share is expected to grow by 12.92% on average over the next years. This is quite good.
Based on estimates for the next years, EL will show a small growth in Revenue. The Revenue will grow by 2.11% on average per year.
EPS Next Y-41.46%
EPS Next 2Y-6.25%
EPS Next 3Y4.87%
EPS Next 5Y12.92%
Revenue Next Year-8.12%
Revenue Next 2Y-3.22%
Revenue Next 3Y-0.75%
Revenue Next 5Y2.11%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better 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
The Price/Earnings ratio is 42.00, which means the current valuation is very expensive for EL.
EL's Price/Earnings is on the same level as the industry average.
When comparing the Price/Earnings ratio of EL to the average of the S&P500 Index (27.18), we can say EL is valued expensively.
EL is valuated quite expensively with a Price/Forward Earnings ratio of 37.68.
The rest of the industry has a similar Price/Forward Earnings ratio as EL.
Compared to an average S&P500 Price/Forward Earnings ratio of 35.34, EL is valued at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 42 | ||
| Fwd PE | 37.68 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of EL is on the same level as its industry peers.
EL's Price/Free Cash Flow ratio is in line with the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 32.67 | ||
| EV/EBITDA | 16.46 |
4.3 Compensation for Growth
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y-6.25%
EPS Next 3Y4.87%
5. Dividend
5.1 Amount
EL has a Yearly Dividend Yield of 1.52%.
EL's Dividend Yield is a higher than the industry average which is at 5.66.
EL's Dividend Yield is slightly below the S&P500 average, which is at 2.34.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.52% |
5.2 History
The dividend of EL is nicely growing with an annual growth rate of 9.59%!
EL has been paying a dividend for at least 10 years, so it has a reliable track record.
Dividend Growth(5Y)9.59%
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
The earnings of EL are negative and hence is the payout ratio. EL will probably not be able to sustain this dividend level.
The dividend of EL is growing, but earnings are growing more, so the dividend growth is sustainable.
DP-83.7%
EPS Next 2Y-6.25%
EPS Next 3Y4.87%
86.1
-3.49 (-3.9%)
Chartmill FA Rating
GICS SectorConsumer Staples
GICS IndustryGroupHousehold & Personal Products
GICS IndustryPersonal Care Products
Earnings (Last)
Earnings (Next)
Inst Owners94.12%
Inst Owner Change0%
Ins Owners0.13%
Ins Owner Change0.05%
Market Cap30.97B
Analysts67.22
Price Target68.52 (-20.42%)
Short Float %6.15%
Short Ratio3.41
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.52% |
Yearly Dividend2.64
Dividend Growth(5Y)9.59%
DP-83.7%
Div Incr Years0
Div Non Decr Years0
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)93.44%
Min EPS beat(2)87.87%
Max EPS beat(2)99.01%
EPS beat(4)4
Avg EPS beat(4)91.1%
Min EPS beat(4)43.76%
Max EPS beat(4)133.75%
EPS beat(8)8
Avg EPS beat(8)120.03%
EPS beat(12)11
Avg EPS beat(12)82.71%
EPS beat(16)15
Avg EPS beat(16)66.99%
Revenue beat(2)0
Avg Revenue beat(2)-2.01%
Min Revenue beat(2)-2.01%
Max Revenue beat(2)-2.01%
Revenue beat(4)0
Avg Revenue beat(4)-2.17%
Min Revenue beat(4)-3.22%
Max Revenue beat(4)-1.43%
Revenue beat(8)1
Avg Revenue beat(8)-1.71%
Revenue beat(12)2
Avg Revenue beat(12)-1.65%
Revenue beat(16)4
Avg Revenue beat(16)-1.52%
PT rev (1m)0.72%
PT rev (3m)-10.03%
EPS NQ rev (1m)-4.55%
EPS NQ rev (3m)-70.5%
EPS NY rev (1m)0.78%
EPS NY rev (3m)5.8%
Revenue NQ rev (1m)0.26%
Revenue NQ rev (3m)-5.13%
Revenue NY rev (1m)0.08%
Revenue NY rev (3m)-1.29%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 42 | ||
| Fwd PE | 37.68 | ||
| P/S | 2.09 | ||
| P/FCF | 32.67 | ||
| P/OCF | 19.86 | ||
| P/B | 7.13 | ||
| P/tB | N/A | ||
| EV/EBITDA | 16.46 |
EPS(TTM)2.05
EY2.38%
EPS(NY)2.29
Fwd EY2.65%
FCF(TTM)2.64
FCFY3.06%
OCF(TTM)4.34
OCFY5.04%
SpS41.1
BVpS12.08
TBVpS-5.18
PEG (NY)N/A
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -4.38% | ||
| ROE | -20.05% | ||
| ROCE | 8.95% | ||
| ROIC | 5.6% | ||
| ROICexc | 6.8% | ||
| ROICexgc | 13.75% | ||
| OM | 9.03% | ||
| PM (TTM) | N/A | ||
| GM | 73.85% | ||
| FCFM | 6.41% |
ROA(3y)5.84%
ROA(5y)6.89%
ROE(3y)22.7%
ROE(5y)26.57%
ROIC(3y)9.14%
ROIC(5y)9.86%
ROICexc(3y)12.1%
ROICexc(5y)13.99%
ROICexgc(3y)27.91%
ROICexgc(5y)31.23%
ROCE(3y)14.59%
ROCE(5y)15.74%
ROICexcg growth 3Y-21.07%
ROICexcg growth 5Y-22.32%
ROICexc growth 3Y-21.66%
ROICexc growth 5Y-23.4%
OM growth 3Y-18.75%
OM growth 5Y-10.71%
PM growth 3Y-47.93%
PM growth 5Y-26.95%
GM growth 3Y-2.09%
GM growth 5Y-1.48%
F-Score5
Asset Turnover0.74
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.68 | ||
| Debt/FCF | 7.7 | ||
| Debt/EBITDA | 3.37 | ||
| Cap/Depr | 73.73% | ||
| Cap/Sales | 4.14% | ||
| Interest Coverage | 3.73 | ||
| Cash Conversion | 72.06% | ||
| Profit Quality | N/A | ||
| Current Ratio | 1.41 | ||
| Quick Ratio | 1.02 | ||
| Altman-Z | 3.15 |
F-Score5
WACC7.8%
ROIC/WACC0.72
Cap/Depr(3y)232.17%
Cap/Depr(5y)179.27%
Cap/Sales(3y)10.8%
Cap/Sales(5y)8.14%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)0.99%
EPS 3Y-26.13%
EPS 5Y-13.41%
EPS Q2Q%-32.99%
EPS Next Y-41.46%
EPS Next 2Y-6.25%
EPS Next 3Y4.87%
EPS Next 5Y12.92%
Revenue 1Y (TTM)-3.76%
Revenue growth 3Y-1.26%
Revenue growth 5Y0.98%
Sales Q2Q%-9.9%
Revenue Next Year-8.12%
Revenue Next 2Y-3.22%
Revenue Next 3Y-0.75%
Revenue Next 5Y2.11%
EBIT growth 1Y4.54%
EBIT growth 3Y-19.77%
EBIT growth 5Y-9.83%
EBIT Next Year30.7%
EBIT Next 3Y19.8%
EBIT Next 5Y16.56%
FCF growth 1Y-9.37%
FCF growth 3Y-21.63%
FCF growth 5Y-4.06%
OCF growth 1Y-25.29%
OCF growth 3Y-13.38%
OCF growth 5Y-1.28%