EASTMAN CHEMICAL CO (EMN) Stock Fundamental Analysis
NYSE:EMN - New York Stock Exchange, Inc. - US2774321002 - Common Stock - Currency: USD
Overall EMN gets a fundamental rating of 6 out of 10. We evaluated EMN against 84 industry peers in the Chemicals industry. While EMN belongs to the best of the industry regarding profitability, there are some minor concerns on its financial health. EMN has a decent growth rate and is not valued too expensively. 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.
EMN had positive earnings in each of the past 5 years.
In the past 5 years EMN always reported a positive cash flow from operatings.
1.2 Ratios
Looking at the Return On Assets, with a value of 6.16%, EMN belongs to the top of the industry, outperforming 86.90% of the companies in the same industry.
EMN's Return On Equity of 15.70% is amongst the best of the industry. EMN outperforms 84.52% of its industry peers.
EMN's Return On Invested Capital of 8.81% is fine compared to the rest of the industry. EMN outperforms 77.38% of its industry peers.
The Average Return On Invested Capital over the past 3 years for EMN is in line with the industry average of 6.84%.
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
EMN has a better Profit Margin (9.85%) than 84.52% of its industry peers.
In the last couple of years the Profit Margin of EMN has grown nicely.
EMN's Operating Margin of 14.67% is fine compared to the rest of the industry. EMN outperforms 77.38% of its industry peers.
In the last couple of years the Operating Margin of EMN has remained more or less at the same level.
With a Gross Margin value of 24.83%, EMN perfoms like the industry average, outperforming 45.24% of the companies in the same industry.
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.
EMN has a better debt/assets ratio than last year.
2.2 Solvency
EMN has an Altman-Z score of 2.59. 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.
EMN has a better Altman-Z score (2.59) than 72.62% of its industry peers.
EMN has a debt to FCF ratio of 8.73. This is a slightly negative value and a sign of low solvency as EMN would need 8.73 years to pay back of all of its debts.
EMN has a Debt to FCF ratio of 8.73. This is in the better half of the industry: EMN outperforms 65.48% 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.
EMN has a Debt to Equity ratio (0.86) which is in line with its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.86 | ||
| Debt/FCF | 8.73 | ||
| Altman-Z | 2.59 |
ROIC/WACC1.06
WACC8.32%
2.3 Liquidity
A Current Ratio of 1.72 indicates that EMN should not have too much problems paying its short term obligations.
Looking at the Current ratio, with a value of 1.72, EMN is doing worse than 61.90% of the companies in the same industry.
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.
With a Quick ratio value of 0.79, EMN is not doing good in the industry: 82.14% of the companies in the same industry are doing better.
| 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 28.37%, which is quite impressive.
The Earnings Per Share has been growing slightly by 2.08% on average over the past years.
Looking at the last year, EMN shows a small growth in Revenue. The Revenue has grown by 2.79% in the last year.
The Revenue has been growing slightly by 0.23% on average over the past years.
EPS 1Y (TTM)28.37%
EPS 3Y-3.79%
EPS 5Y2.08%
EPS Q2Q%18.63%
Revenue 1Y (TTM)2.79%
Revenue growth 3Y-3.61%
Revenue growth 5Y0.23%
Sales Q2Q%-0.87%
3.2 Future
The Earnings Per Share is expected to grow by 5.40% on average over the next years.
Based on estimates for the next years, EMN will show a small growth in Revenue. The Revenue will grow by 0.59% on average per year.
EPS Next Y-5.44%
EPS Next 2Y2.78%
EPS Next 3Y5.49%
EPS Next 5Y5.4%
Revenue Next Year-1.34%
Revenue Next 2Y0.94%
Revenue Next 3Y1.71%
Revenue Next 5Y0.59%
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
EMN is valuated reasonably with a Price/Earnings ratio of 9.41.
Based on the Price/Earnings ratio, EMN is valued cheaper than 89.29% of the companies in the same industry.
The average S&P500 Price/Earnings ratio is at 26.57. EMN is valued rather cheaply when compared to this.
EMN is valuated reasonably with a Price/Forward Earnings ratio of 9.24.
Based on the Price/Forward Earnings ratio, EMN is valued a bit cheaper than 79.76% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of EMN to the average of the S&P500 Index (22.41), we can say EMN is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.41 | ||
| Fwd PE | 9.24 |
4.2 Price Multiples
EMN's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. EMN is cheaper than 79.76% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, EMN is valued a bit cheaper than the industry average as 77.38% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 15.47 | ||
| EV/EBITDA | 7.02 |
4.3 Compensation for Growth
The excellent profitability rating of EMN may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)4.53
EPS Next 2Y2.78%
EPS Next 3Y5.49%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 4.21%, EMN is a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 3.68, EMN pays a better dividend. On top of this EMN pays more dividend than 84.52% of the companies listed in the same industry.
EMN's Dividend Yield is rather good when compared to the S&P500 average which is at 2.40.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.21% |
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
EMN pays out 41.21% of its income as dividend. This is a bit on the high side, but may be sustainable.
EMN's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP41.21%
EPS Next 2Y2.78%
EPS Next 3Y5.49%
77.04
+0.85 (+1.12%)
Chartmill FA Rating
GICS SectorMaterials
GICS IndustryGroupMaterials
GICS IndustryChemicals
Earnings (Last)
Earnings (Next)
Inst Owners93.28%
Inst Owner Change-0.09%
Ins Owners0.66%
Ins Owner Change6.82%
Market Cap8.90B
Analysts76.8
Price Target97.95 (27.14%)
Short Float %2.99%
Short Ratio1.81
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.21% |
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)-2.07%
PT rev (3m)-16.27%
EPS NQ rev (1m)-0.08%
EPS NQ rev (3m)-19.8%
EPS NY rev (1m)0%
EPS NY rev (3m)-12.91%
Revenue NQ rev (1m)0.04%
Revenue NQ rev (3m)-4.58%
Revenue NY rev (1m)-0.03%
Revenue NY rev (3m)-3.43%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.41 | ||
| Fwd PE | 9.24 | ||
| P/S | 0.95 | ||
| P/FCF | 15.47 | ||
| P/OCF | 7.83 | ||
| P/B | 1.52 | ||
| P/tB | 7.36 | ||
| EV/EBITDA | 7.02 |
EPS(TTM)8.19
EY10.63%
EPS(NY)8.34
Fwd EY10.82%
FCF(TTM)4.98
FCFY6.46%
OCF(TTM)9.84
OCFY12.77%
SpS81.08
BVpS50.85
TBVpS10.46
PEG (NY)N/A
PEG (5Y)4.53
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 | 2.59 |
F-Score6
WACC8.32%
ROIC/WACC1.06
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)28.37%
EPS 3Y-3.79%
EPS 5Y2.08%
EPS Q2Q%18.63%
EPS Next Y-5.44%
EPS Next 2Y2.78%
EPS Next 3Y5.49%
EPS Next 5Y5.4%
Revenue 1Y (TTM)2.79%
Revenue growth 3Y-3.61%
Revenue growth 5Y0.23%
Sales Q2Q%-0.87%
Revenue Next Year-1.34%
Revenue Next 2Y0.94%
Revenue Next 3Y1.71%
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%