EASTMAN CHEMICAL CO (EMN) Stock Fundamental Analysis
NYSE:EMN - New York Stock Exchange, Inc. - US2774321002 - Common Stock - Currency: USD
Taking everything into account, EMN scores 6 out of 10 in our fundamental rating. EMN was compared to 85 industry peers in the Chemicals industry. EMN has an excellent profitability rating, but there are some minor concerns on its financial health. EMN is valued quite cheap, while showing a decent growth score. This is a good combination! Finally EMN also has an excellent dividend rating.
1. Profitability
1.1 Basic Checks
EMN had positive earnings in the past year.
EMN had a positive operating cash flow in the past year.
In the past 5 years EMN has always been profitable.
EMN had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
The Return On Assets of EMN (6.16%) is better than 87.06% of its industry peers.
EMN has a better Return On Equity (15.70%) than 84.71% of its industry peers.
Looking at the Return On Invested Capital, with a value of 8.81%, EMN is in the better half of the industry, outperforming 77.65% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for EMN is in line with the industry average of 6.80%.
The last Return On Invested Capital (8.81%) for EMN is above the 3 year average (8.36%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.16% | ||
| ROE | 15.7% | ||
| ROIC | 8.81% |
ROA(3y)5.82%
ROA(5y)5.19%
ROE(3y)15.81%
ROE(5y)14.08%
ROIC(3y)8.36%
ROIC(5y)8.64%
1.3 Margins
With an excellent Profit Margin value of 9.85%, EMN belongs to the best of the industry, outperforming 84.71% of the companies in the same industry.
In the last couple of years the Profit Margin of EMN has grown nicely.
Looking at the Operating Margin, with a value of 14.67%, EMN is in the better half of the industry, outperforming 77.65% of the companies in the same industry.
EMN's Operating Margin has been stable in the last couple of years.
EMN has a Gross Margin (24.83%) which is in line with its industry peers.
In the last couple of years the Gross Margin of EMN has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 14.67% | ||
| PM (TTM) | 9.85% | ||
| GM | 24.83% |
OM growth 3Y-7.23%
OM growth 5Y1.24%
PM growth 3Y5.65%
PM growth 5Y3.34%
GM growth 3Y0.75%
GM growth 5Y0.26%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so EMN is still creating some value.
Compared to 1 year ago, EMN has less shares outstanding
EMN has less shares outstanding than it did 5 years ago.
The debt/assets ratio for EMN has been reduced compared to a year ago.
2.2 Solvency
EMN has an Altman-Z score of 2.56. This is not the best score and indicates that EMN is in the grey zone with still only limited risk for bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 2.56, EMN is in the better half of the industry, outperforming 74.12% of the companies in the same industry.
The Debt to FCF ratio of EMN is 8.73, which is on the high side as it means it would take EMN, 8.73 years of fcf income to pay off all of its debts.
EMN's Debt to FCF ratio of 8.73 is fine compared to the rest of the industry. EMN outperforms 65.88% of its industry peers.
EMN has a Debt/Equity ratio of 0.86. This is a neutral value indicating EMN is somewhat dependend on debt financing.
Looking at the Debt to Equity ratio, with a value of 0.86, EMN is in line with its industry, outperforming 42.35% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.86 | ||
| Debt/FCF | 8.73 | ||
| Altman-Z | 2.56 |
ROIC/WACC1.04
WACC8.48%
2.3 Liquidity
EMN has a Current Ratio of 1.72. This is a normal value and indicates that EMN is financially healthy and should not expect problems in meeting its short term obligations.
EMN's Current ratio of 1.72 is on the low side compared to the rest of the industry. EMN is outperformed by 61.18% of its industry peers.
EMN has a Quick Ratio of 1.72. This is a bad value and indicates that EMN is not financially healthy enough and could expect problems in meeting its short term obligations.
The Quick ratio of EMN (0.79) is worse than 81.18% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.72 | ||
| Quick Ratio | 0.79 |
3. Growth
3.1 Past
EMN shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 16.82%, which is quite good.
EMN shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 2.08% yearly.
Looking at the last year, EMN shows a small growth in Revenue. The Revenue has grown by 1.87% in the last year.
EMN shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 0.23% yearly.
EPS 1Y (TTM)16.82%
EPS 3Y-3.79%
EPS 5Y2.08%
EPS Q2Q%-25.58%
Revenue 1Y (TTM)1.87%
Revenue growth 3Y-3.61%
Revenue growth 5Y0.23%
Sales Q2Q%-3.22%
3.2 Future
Based on estimates for the next years, EMN will show a small growth in Earnings Per Share. The EPS will grow by 5.40% on average per year.
EMN is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 0.59% yearly.
EPS Next Y-6.69%
EPS Next 2Y2.47%
EPS Next 3Y5.22%
EPS Next 5Y5.4%
Revenue Next Year-1.44%
Revenue Next 2Y0.87%
Revenue Next 3Y1.61%
Revenue Next 5Y0.59%
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
Based on the Price/Earnings ratio of 9.50, the valuation of EMN can be described as reasonable.
Compared to the rest of the industry, the Price/Earnings ratio of EMN indicates a rather cheap valuation: EMN is cheaper than 89.41% of the companies listed in the same industry.
When comparing the Price/Earnings ratio of EMN to the average of the S&P500 Index (27.25), we can say EMN is valued rather cheaply.
With a Price/Forward Earnings ratio of 8.76, the valuation of EMN can be described as very reasonable.
Based on the Price/Forward Earnings ratio, EMN is valued cheaper than 84.71% of the companies in the same industry.
EMN's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 36.80.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.5 | ||
| Fwd PE | 8.76 |
4.2 Price Multiples
82.35% of the companies in the same industry are more expensive than EMN, based on the Enterprise Value to EBITDA ratio.
EMN's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. EMN is cheaper than 77.65% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 14.58 | ||
| EV/EBITDA | 6.75 |
4.3 Compensation for Growth
The excellent profitability rating of EMN may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)4.58
EPS Next 2Y2.47%
EPS Next 3Y5.22%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 4.52%, EMN is a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 3.57, EMN pays a better dividend. On top of this EMN pays more dividend than 84.71% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 2.34, EMN pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.52% |
5.2 History
The dividend of EMN has a limited annual growth rate of 5.58%.
EMN has paid a dividend for at least 10 years, which is a reliable track record.
EMN has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)5.58%
Div Incr Years15
Div Non Decr Years30
5.3 Sustainability
41.21% of the earnings are spent on dividend by EMN. This is a bit on the high side, but may be sustainable.
The dividend of EMN is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP41.21%
EPS Next 2Y2.47%
EPS Next 3Y5.22%
72.61
-0.82 (-1.12%)
Chartmill FA Rating
GICS SectorMaterials
GICS IndustryGroupMaterials
GICS IndustryChemicals
Earnings (Last)
Earnings (Next)
Inst Owners93.28%
Inst Owner Change-0.62%
Ins Owners0.66%
Ins Owner Change6.82%
Market Cap8.38B
Analysts78.26
Price Target97.81 (34.71%)
Short Float %2.3%
Short Ratio1.46
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.52% |
Yearly Dividend3.26
Dividend Growth(5Y)5.58%
DP41.21%
Div Incr Years15
Div Non Decr Years30
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)9.11%
Min EPS beat(2)-0.03%
Max EPS beat(2)18.25%
EPS beat(4)3
Avg EPS beat(4)7.11%
Min EPS beat(4)-0.03%
Max EPS beat(4)18.25%
EPS beat(8)7
Avg EPS beat(8)5.32%
EPS beat(12)10
Avg EPS beat(12)3.91%
EPS beat(16)11
Avg EPS beat(16)2.69%
Revenue beat(2)0
Avg Revenue beat(2)-2.39%
Min Revenue beat(2)-2.55%
Max Revenue beat(2)-2.22%
Revenue beat(4)1
Avg Revenue beat(4)-0.73%
Min Revenue beat(4)-2.55%
Max Revenue beat(4)2.62%
Revenue beat(8)1
Avg Revenue beat(8)-2.4%
Revenue beat(12)2
Avg Revenue beat(12)-1.74%
Revenue beat(16)6
Avg Revenue beat(16)0.68%
PT rev (1m)-1.45%
PT rev (3m)-10.44%
EPS NQ rev (1m)-3.85%
EPS NQ rev (3m)-22.16%
EPS NY rev (1m)-1.07%
EPS NY rev (3m)-12.23%
Revenue NQ rev (1m)-0.34%
Revenue NQ rev (3m)-4.75%
Revenue NY rev (1m)-0.05%
Revenue NY rev (3m)-2.75%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.5 | ||
| Fwd PE | 8.76 | ||
| P/S | 0.9 | ||
| P/FCF | 14.58 | ||
| P/OCF | 7.38 | ||
| P/B | 1.43 | ||
| P/tB | 6.94 | ||
| EV/EBITDA | 6.75 |
EPS(TTM)7.64
EY10.52%
EPS(NY)8.29
Fwd EY11.41%
FCF(TTM)4.98
FCFY6.86%
OCF(TTM)9.84
OCFY13.55%
SpS81.08
BVpS50.85
TBVpS10.46
PEG (NY)N/A
PEG (5Y)4.58
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.16% | ||
| ROE | 15.7% | ||
| ROCE | 10.81% | ||
| ROIC | 8.81% | ||
| ROICexc | 9.1% | ||
| ROICexgc | 14.47% | ||
| OM | 14.67% | ||
| PM (TTM) | 9.85% | ||
| GM | 24.83% | ||
| FCFM | 6.14% |
ROA(3y)5.82%
ROA(5y)5.19%
ROE(3y)15.81%
ROE(5y)14.08%
ROIC(3y)8.36%
ROIC(5y)8.64%
ROICexc(3y)8.83%
ROICexc(5y)9.06%
ROICexgc(3y)15.26%
ROICexgc(5y)15.76%
ROCE(3y)10.04%
ROCE(5y)10.38%
ROICexcg growth 3Y-10.23%
ROICexcg growth 5Y3.54%
ROICexc growth 3Y-9.52%
ROICexc growth 5Y5.53%
OM growth 3Y-7.23%
OM growth 5Y1.24%
PM growth 3Y5.65%
PM growth 5Y3.34%
GM growth 3Y0.75%
GM growth 5Y0.26%
F-Score6
Asset Turnover0.63
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.86 | ||
| Debt/FCF | 8.73 | ||
| Debt/EBITDA | 2.67 | ||
| Cap/Depr | 110.43% | ||
| Cap/Sales | 5.99% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 60.39% | ||
| Profit Quality | 62.36% | ||
| Current Ratio | 1.72 | ||
| Quick Ratio | 0.79 | ||
| Altman-Z | 2.56 |
F-Score6
WACC8.48%
ROIC/WACC1.04
Cap/Depr(3y)138.26%
Cap/Depr(5y)116.93%
Cap/Sales(3y)7.09%
Cap/Sales(5y)6.22%
Profit Quality(3y)60.45%
Profit Quality(5y)105.96%
High Growth Momentum
Growth
EPS 1Y (TTM)16.82%
EPS 3Y-3.79%
EPS 5Y2.08%
EPS Q2Q%-25.58%
EPS Next Y-6.69%
EPS Next 2Y2.47%
EPS Next 3Y5.22%
EPS Next 5Y5.4%
Revenue 1Y (TTM)1.87%
Revenue growth 3Y-3.61%
Revenue growth 5Y0.23%
Sales Q2Q%-3.22%
Revenue Next Year-1.44%
Revenue Next 2Y0.87%
Revenue Next 3Y1.61%
Revenue Next 5Y0.59%
EBIT growth 1Y34.61%
EBIT growth 3Y-10.58%
EBIT growth 5Y1.48%
EBIT Next Year42.05%
EBIT Next 3Y17.45%
EBIT Next 5Y11.73%
FCF growth 1Y112.18%
FCF growth 3Y-13.53%
FCF growth 5Y-8.61%
OCF growth 1Y18.83%
OCF growth 3Y-7.36%
OCF growth 5Y-3.07%