EMERA INC (EMA.CA) Stock Fundamental Analysis
Canada - Toronto Stock Exchange - TSX:EMA - CA2908761018 - Common Stock
68.32 CAD
+0.19 (+0.28%)
Taking everything into account, EMA scores 3 out of 10 in our fundamental rating. EMA was compared to 18 industry peers in the Electric Utilities industry. Both the profitability and financial health of EMA have multiple concerns. While showing a medium growth rate, EMA is valued expensive at the moment. Finally EMA also has an excellent dividend rating.
1. Profitability
1.1 Basic Checks
- In the past year EMA was profitable.
- In the past year EMA had a positive cash flow from operations.
- In the past 5 years EMA has always been profitable.
- In the past 5 years EMA always reported a positive cash flow from operatings.
1.2 Ratios
- With a Return On Assets value of 2.56%, EMA perfoms like the industry average, outperforming 50.00% of the companies in the same industry.
- EMA has a Return On Equity (8.29%) which is in line with its industry peers.
- With a Return On Invested Capital value of 3.70%, EMA is not doing good in the industry: 94.44% of the companies in the same industry are doing better.
- The Average Return On Invested Capital over the past 3 years for EMA is in line with the industry average of 4.03%.
- The last Return On Invested Capital (3.70%) for EMA is above the 3 year average (3.14%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.56% | ||
| ROE | 8.29% | ||
| ROIC | 3.7% |
ROA(3y)2%
ROA(5y)2.1%
ROE(3y)6.7%
ROE(5y)7.06%
ROIC(3y)3.14%
ROIC(5y)2.92%
1.3 Margins
- With a Profit Margin value of 12.89%, EMA is not doing good in the industry: 94.44% of the companies in the same industry are doing better.
- EMA's Profit Margin has declined in the last couple of years.
- With a Operating Margin value of 23.65%, EMA is not doing good in the industry: 88.89% of the companies in the same industry are doing better.
- In the last couple of years the Operating Margin of EMA has declined.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 23.65% | ||
| PM (TTM) | 12.89% | ||
| GM | N/A |
OM growth 3Y3.96%
OM growth 5Y-4.26%
PM growth 3Y-8.12%
PM growth 5Y-8.76%
GM growth 3YN/A
GM growth 5YN/A
2. Health
2.1 Basic Checks
- The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so EMA is destroying value.
- Compared to 1 year ago, EMA has more shares outstanding
- Compared to 5 years ago, EMA has more shares outstanding
- Compared to 1 year ago, EMA has an improved debt to assets ratio.
2.2 Solvency
- EMA has an Altman-Z score of 0.78. This is a bad value and indicates that EMA is not financially healthy and even has some risk of bankruptcy.
- The Altman-Z score of EMA (0.78) is better than 83.33% of its industry peers.
- A Debt/Equity ratio of 1.47 is on the high side and indicates that EMA has dependencies on debt financing.
- EMA has a Debt to Equity ratio of 1.47. This is amonst the worse of the industry: EMA underperforms 94.44% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.47 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 0.78 |
ROIC/WACC0.63
WACC5.85%
2.3 Liquidity
- A Current Ratio of 0.72 indicates that EMA may have some problems paying its short term obligations.
- With a Current ratio value of 0.72, EMA perfoms like the industry average, outperforming 55.56% of the companies in the same industry.
- A Quick Ratio of 0.57 indicates that EMA may have some problems paying its short term obligations.
- EMA has a Quick ratio of 0.57. This is comparable to the rest of the industry: EMA outperforms 55.56% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.72 | ||
| Quick Ratio | 0.57 |
3. Growth
3.1 Past
- The Earnings Per Share has grown by an impressive 38.83% over the past year.
- EMA shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 2.49% yearly.
- Looking at the last year, EMA shows a quite strong growth in Revenue. The Revenue has grown by 15.17% in the last year.
- The Revenue has been growing slightly by 3.33% on average over the past years.
EPS 1Y (TTM)38.83%
EPS 3Y1.4%
EPS 5Y2.49%
EPS Q2Q%8.64%
Revenue 1Y (TTM)15.17%
Revenue growth 3Y7.69%
Revenue growth 5Y3.33%
Sales Q2Q%16.87%
3.2 Future
- Based on estimates for the next years, EMA will show a small growth in Earnings Per Share. The EPS will grow by 7.96% on average per year.
- Based on estimates for the next years, EMA will show a small growth in Revenue. The Revenue will grow by 2.56% on average per year.
EPS Next Y21.58%
EPS Next 2Y9.9%
EPS Next 3Y7.77%
EPS Next 5Y7.96%
Revenue Next Year14.29%
Revenue Next 2Y4.69%
Revenue Next 3Y6.1%
Revenue Next 5Y2.56%
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 decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
- With a Price/Earnings ratio of 18.03, EMA is valued on the expensive side.
- Compared to the rest of the industry, the Price/Earnings ratio of EMA indicates a rather expensive valuation: EMA more expensive than 83.33% of the companies listed in the same industry.
- When comparing the Price/Earnings ratio of EMA to the average of the S&P500 Index (28.60), we can say EMA is valued slightly cheaper.
- Based on the Price/Forward Earnings ratio of 19.24, the valuation of EMA can be described as rather expensive.
- Based on the Price/Forward Earnings ratio, EMA is valued expensively inside the industry as 83.33% of the companies are valued cheaper.
- Compared to an average S&P500 Price/Forward Earnings ratio of 25.83, EMA is valued a bit cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 18.03 | ||
| Fwd PE | 19.24 |
4.2 Price Multiples
- Based on the Enterprise Value to EBITDA ratio, EMA is valued expensively inside the industry as 83.33% of the companies are valued cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 11.86 |
4.3 Compensation for Growth
- The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
PEG (NY)0.84
PEG (5Y)7.24
EPS Next 2Y9.9%
EPS Next 3Y7.77%
5. Dividend
5.1 Amount
- With a Yearly Dividend Yield of 4.28%, EMA is a good candidate for dividend investing.
- EMA's Dividend Yield is rather good when compared to the industry average which is at 3.93. EMA pays more dividend than 94.44% of the companies in the same industry.
- EMA's Dividend Yield is rather good when compared to the S&P500 average which is at 1.82.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.28% |
5.2 History
- The dividend of EMA has a limited annual growth rate of 3.46%.
- EMA has paid a dividend for at least 10 years, which is a reliable track record.
- EMA has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)3.46%
Div Incr Years18
Div Non Decr Years26
5.3 Sustainability
- EMA pays out 57.91% of its income as dividend. This is a bit on the high side, but may be sustainable.
- The dividend of EMA is growing, but earnings are growing more, so the dividend growth is sustainable.
DP57.91%
EPS Next 2Y9.9%
EPS Next 3Y7.77%
EMERA INC / EMA.CA FAQ
What is the fundamental rating for EMA stock?
ChartMill assigns a fundamental rating of 3 / 10 to EMA.CA.
Can you provide the valuation status for EMERA INC?
ChartMill assigns a valuation rating of 2 / 10 to EMERA INC (EMA.CA). This can be considered as Overvalued.
What is the profitability of EMA stock?
EMERA INC (EMA.CA) has a profitability rating of 3 / 10.
What are the PE and PB ratios of EMERA INC (EMA.CA) stock?
The Price/Earnings (PE) ratio for EMERA INC (EMA.CA) is 18.03 and the Price/Book (PB) ratio is 1.55.
What is the expected EPS growth for EMERA INC (EMA.CA) stock?
The Earnings per Share (EPS) of EMERA INC (EMA.CA) is expected to grow by 21.58% in the next year.