ESTEE LAUDER COMPANIES-CL A (EL) Stock Fundamental Analysis
NYSE:EL - New York Stock Exchange, Inc. - US5184391044 - Common Stock - Currency: USD
Taking everything into account, EL scores 4 out of 10 in our fundamental rating. EL was compared to 35 industry peers in the Personal Care Products industry. There are concerns on the financial health of EL while its profitability can be described as average. EL is quite expensive at the moment. It does show a decent growth rate.
1. Profitability
1.1 Basic Checks
In the past year EL was profitable.
EL had a positive operating cash flow in the past year.
In the past 5 years EL has always been profitable.
EL had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
The Return On Assets of EL (-4.38%) is worse than 68.57% of its industry peers.
EL's Return On Equity of -20.05% is on the low side compared to the rest of the industry. EL is outperformed by 65.71% of its industry peers.
The Return On Invested Capital of EL (5.60%) is comparable to the rest of the industry.
EL had an Average Return On Invested Capital over the past 3 years of 9.14%. This 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
In the last couple of years the Profit Margin of EL has declined.
The Operating Margin of EL (9.03%) is better than 62.86% of its industry peers.
In the last couple of years the Operating Margin of EL has declined.
The Gross Margin of EL (73.85%) is better than 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.
Compared to 5 years ago, EL has less shares outstanding
The debt/assets ratio for EL is higher compared to a year ago.
2.2 Solvency
EL has an Altman-Z score of 2.99. This indicates that EL is financially healthy and has little risk of bankruptcy at the moment.
EL has a Altman-Z score (2.99) which is in line with its industry peers.
EL has a debt to FCF ratio of 7.70. This is a slightly negative value and a sign of low solvency as EL would need 7.70 years to pay back of all of its debts.
Looking at the Debt to FCF ratio, with a value of 7.70, EL is in line with its industry, outperforming 60.00% of the companies in the same industry.
A Debt/Equity ratio of 1.68 is on the high side and indicates that EL has dependencies on debt financing.
EL has a worse Debt to Equity ratio (1.68) than 80.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.68 | ||
| Debt/FCF | 7.7 | ||
| Altman-Z | 2.99 |
ROIC/WACC0.71
WACC7.89%
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.
EL has a Quick ratio of 1.02. This is comparable to the rest of the industry: EL outperforms 45.71% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.41 | ||
| Quick Ratio | 1.02 |
3. Growth
3.1 Past
EL shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 0.99%.
Measured over the past years, EL shows a very negative growth in Earnings Per Share. The EPS has been decreasing by -13.41% on average per year.
Looking at the last year, EL shows a decrease in Revenue. The Revenue has decreased by -3.76% in the last year.
The Revenue has been growing slightly by 0.98% on average over the past years.
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
EL is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 12.92% yearly.
EL is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 2.11% yearly.
EPS Next Y-41.91%
EPS Next 2Y-7.21%
EPS Next 3Y4.05%
EPS Next 5Y12.92%
Revenue Next Year-8.2%
Revenue Next 2Y-3.33%
Revenue Next 3Y-0.91%
Revenue Next 5Y2.11%
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.
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
A Price/Earnings ratio of 36.39 indicates a quite expensive valuation of EL.
EL's Price/Earnings is on the same level as the industry average.
Compared to an average S&P500 Price/Earnings ratio of 26.57, EL is valued a bit more expensive.
The Price/Forward Earnings ratio is 33.32, which means the current valuation is very expensive for EL.
EL's Price/Forward Earnings ratio is in line with the industry average.
Compared to an average S&P500 Price/Forward Earnings ratio of 22.41, EL is valued a bit more expensive.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 36.39 | ||
| Fwd PE | 33.32 |
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.
65.71% of the companies in the same industry are more expensive than EL, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 28.31 | ||
| EV/EBITDA | 14.55 |
4.3 Compensation for Growth
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y-7.21%
EPS Next 3Y4.05%
5. Dividend
5.1 Amount
EL has a Yearly Dividend Yield of 2.00%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 5.67, EL pays a bit more dividend than its industry peers.
Compared to an average S&P500 Dividend Yield of 2.40, EL has a dividend comparable with the average S&P500 company.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2% |
5.2 History
On average, the dividend of EL grows each year by 9.59%, which is quite nice.
EL has paid a dividend for at least 10 years, which is 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.
EL's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP-83.7%
EPS Next 2Y-7.21%
EPS Next 3Y4.05%
74.59
+7.28 (+10.82%)
Chartmill FA Rating
GICS SectorConsumer Staples
GICS IndustryGroupHousehold & Personal Products
GICS IndustryPersonal Care Products
Earnings (Last)
Earnings (Next)
Inst Owners94.12%
Inst Owner Change0.53%
Ins Owners0.13%
Ins Owner Change0.05%
Market Cap26.83B
Analysts66.11
Price Target68.03 (-8.79%)
Short Float %4.41%
Short Ratio2.46
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2% |
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)-0.09%
PT rev (3m)-10.9%
EPS NQ rev (1m)0.3%
EPS NQ rev (3m)-70.04%
EPS NY rev (1m)0%
EPS NY rev (3m)5.27%
Revenue NQ rev (1m)0.06%
Revenue NQ rev (3m)-5.38%
Revenue NY rev (1m)0.03%
Revenue NY rev (3m)-1.35%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 36.39 | ||
| Fwd PE | 33.32 | ||
| P/S | 1.81 | ||
| P/FCF | 28.31 | ||
| P/OCF | 17.2 | ||
| P/B | 6.18 | ||
| P/tB | N/A | ||
| EV/EBITDA | 14.55 |
EPS(TTM)2.05
EY2.75%
EPS(NY)2.24
Fwd EY3%
FCF(TTM)2.64
FCFY3.53%
OCF(TTM)4.34
OCFY5.81%
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 | 2.99 |
F-Score5
WACC7.89%
ROIC/WACC0.71
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-41.91%
EPS Next 2Y-7.21%
EPS Next 3Y4.05%
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-8.2%
Revenue Next 2Y-3.33%
Revenue Next 3Y-0.91%
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%