EMPIRE CO LTD 'A' (EMP-A.CA) Stock Fundamental Analysis
Canada - Toronto Stock Exchange - TSX:EMP-A - CA2918434077 - Common Stock
44.72 CAD
-0.74 (-1.63%)
EMP-A gets a fundamental rating of 4 out of 10. The analysis compared the fundamentals against 17 industry peers in the Consumer Staples Distribution & Retail industry. While EMP-A is still in line with the averages on profitability rating, there are concerns on its financial health. EMP-A is not valued too expensively and it also shows a decent growth rate.
1. Profitability
1.1 Basic Checks
- In the past year EMP-A was profitable.
- In the past year EMP-A had a positive cash flow from operations.
- Each year in the past 5 years EMP-A has been profitable.
- EMP-A had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
- EMP-A has a Return On Assets of 4.01%. This is in the better half of the industry: EMP-A outperforms 76.47% of its industry peers.
- With a Return On Equity value of 12.55%, EMP-A perfoms like the industry average, outperforming 47.06% of the companies in the same industry.
- EMP-A has a Return On Invested Capital (6.71%) which is in line with its industry peers.
- Measured over the past 3 years, the Average Return On Invested Capital for EMP-A is in line with the industry average of 8.51%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.01% | ||
| ROE | 12.55% | ||
| ROIC | 6.71% |
ROA(3y)4.2%
ROA(5y)4.34%
ROE(3y)13.24%
ROE(5y)14.14%
ROIC(3y)6.72%
ROIC(5y)7.1%
1.3 Margins
- The Profit Margin of EMP-A (2.18%) is worse than 64.71% of its industry peers.
- EMP-A's Profit Margin has been stable in the last couple of years.
- Looking at the Operating Margin, with a value of 3.77%, EMP-A is doing worse than 64.71% of the companies in the same industry.
- EMP-A's Operating Margin has been stable in the last couple of years.
- EMP-A's Gross Margin of 27.12% is on the low side compared to the rest of the industry. EMP-A is outperformed by 70.59% of its industry peers.
- In the last couple of years the Gross Margin of EMP-A has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 3.77% | ||
| PM (TTM) | 2.18% | ||
| GM | 27.12% |
OM growth 3Y-2.37%
OM growth 5Y-0.73%
PM growth 3Y-3.27%
PM growth 5Y0.38%
GM growth 3Y1.81%
GM growth 5Y1.44%
2. Health
2.1 Basic Checks
- EMP-A has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
- Compared to 1 year ago, EMP-A has less shares outstanding
- The number of shares outstanding for EMP-A has been reduced compared to 5 years ago.
- The debt/assets ratio for EMP-A has remained at the same level compared to a year ago.
2.2 Solvency
- An Altman-Z score of 2.86 indicates that EMP-A is not a great score, but indicates only limited risk for bankruptcy at the moment.
- EMP-A has a better Altman-Z score (2.86) than 64.71% of its industry peers.
- The Debt to FCF ratio of EMP-A is 6.10, which is on the high side as it means it would take EMP-A, 6.10 years of fcf income to pay off all of its debts.
- With a decent Debt to FCF ratio value of 6.10, EMP-A is doing good in the industry, outperforming 64.71% of the companies in the same industry.
- EMP-A has a Debt/Equity ratio of 1.24. This is a high value indicating a heavy dependency on external financing.
- EMP-A has a Debt to Equity ratio (1.24) which is in line with its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.24 | ||
| Debt/FCF | 6.1 | ||
| Altman-Z | 2.86 |
ROIC/WACC1.06
WACC6.31%
2.3 Liquidity
- EMP-A has a Current Ratio of 0.85. This is a bad value and indicates that EMP-A is not financially healthy enough and could expect problems in meeting its short term obligations.
- With a Current ratio value of 0.85, EMP-A is not doing good in the industry: 94.12% of the companies in the same industry are doing better.
- A Quick Ratio of 0.35 indicates that EMP-A may have some problems paying its short term obligations.
- EMP-A has a Quick ratio of 0.35. This is amonst the worse of the industry: EMP-A underperforms 88.24% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.85 | ||
| Quick Ratio | 0.35 |
3. Growth
3.1 Past
- The Earnings Per Share has been growing slightly by 2.78% over the past year.
- The Earnings Per Share has been growing slightly by 6.33% on average over the past years.
- Looking at the last year, EMP-A shows a small growth in Revenue. The Revenue has grown by 2.58% in the last year.
- Measured over the past years, EMP-A shows a small growth in Revenue. The Revenue has been growing by 3.30% on average per year.
EPS 1Y (TTM)2.78%
EPS 3Y2.09%
EPS 5Y6.33%
EPS Q2Q%-5.48%
Revenue 1Y (TTM)2.58%
Revenue growth 3Y1.22%
Revenue growth 5Y3.3%
Sales Q2Q%2.79%
3.2 Future
- EMP-A is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 9.20% yearly.
- Based on estimates for the next years, EMP-A will show a small growth in Revenue. The Revenue will grow by 2.90% on average per year.
EPS Next Y9.55%
EPS Next 2Y8.9%
EPS Next 3Y9.2%
EPS Next 5YN/A
Revenue Next Year2.23%
Revenue Next 2Y2.59%
Revenue Next 3Y2.9%
Revenue Next 5YN/A
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 stable: in the next years the growth will be about the same than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
- With a Price/Earnings ratio of 15.11, EMP-A is valued correctly.
- Compared to the rest of the industry, the Price/Earnings ratio of EMP-A indicates a somewhat cheap valuation: EMP-A is cheaper than 76.47% of the companies listed in the same industry.
- When comparing the Price/Earnings ratio of EMP-A to the average of the S&P500 Index (27.25), we can say EMP-A is valued slightly cheaper.
- Based on the Price/Forward Earnings ratio of 12.61, the valuation of EMP-A can be described as correct.
- Based on the Price/Forward Earnings ratio, EMP-A is valued a bit cheaper than 64.71% of the companies in the same industry.
- EMP-A is valuated cheaply when we compare the Price/Forward Earnings ratio to 25.98, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.11 | ||
| Fwd PE | 12.61 |
4.2 Price Multiples
- Based on the Enterprise Value to EBITDA ratio, EMP-A is valued a bit cheaper than 64.71% of the companies in the same industry.
- Compared to the rest of the industry, the Price/Free Cash Flow ratio of EMP-A indicates a somewhat cheap valuation: EMP-A is cheaper than 70.59% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 8.26 | ||
| EV/EBITDA | 7.57 |
4.3 Compensation for Growth
- The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
PEG (NY)1.58
PEG (5Y)2.39
EPS Next 2Y8.9%
EPS Next 3Y9.2%
5. Dividend
5.1 Amount
- EMP-A has a Yearly Dividend Yield of 1.93%. Purely for dividend investing, there may be better candidates out there.
- Compared to an average industry Dividend Yield of 2.25, EMP-A has a dividend in line with its industry peers.
- Compared to an average S&P500 Dividend Yield of 1.82, EMP-A has a dividend comparable with the average S&P500 company.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.93% |
5.2 History
- On average, the dividend of EMP-A grows each year by 11.03%, which is quite nice.
- EMP-A has paid a dividend for at least 10 years, which is a reliable track record.
- EMP-A has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)11.03%
Div Incr Years30
Div Non Decr Years34
5.3 Sustainability
- 28.62% of the earnings are spent on dividend by EMP-A. This is a low number and sustainable payout ratio.
- The dividend of EMP-A is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP28.62%
EPS Next 2Y8.9%
EPS Next 3Y9.2%
EMPIRE CO LTD 'A' / EMP-A.CA FAQ
What is the fundamental rating for EMP-A stock?
ChartMill assigns a fundamental rating of 4 / 10 to EMP-A.CA.
What is the valuation status of EMPIRE CO LTD 'A' (EMP-A.CA) stock?
ChartMill assigns a valuation rating of 5 / 10 to EMPIRE CO LTD 'A' (EMP-A.CA). This can be considered as Fairly Valued.
How profitable is EMPIRE CO LTD 'A' (EMP-A.CA) stock?
EMPIRE CO LTD 'A' (EMP-A.CA) has a profitability rating of 4 / 10.
Can you provide the PE and PB ratios for EMP-A stock?
The Price/Earnings (PE) ratio for EMPIRE CO LTD 'A' (EMP-A.CA) is 15.11 and the Price/Book (PB) ratio is 1.87.
How financially healthy is EMPIRE CO LTD 'A'?
The financial health rating of EMPIRE CO LTD 'A' (EMP-A.CA) is 3 / 10.