EQUITY RESIDENTIAL (EQR) Stock Fundamental Analysis
USA - NYSE:EQR - US29476L1070 - REIT
65.05 USD
+0.18 (+0.28%)
65.05 USD
0 (0%)
We assign a fundamental rating of 4 out of 10 to EQR. EQR was compared to 20 industry peers in the Residential REITs industry. While EQR belongs to the best of the industry regarding profitability, there are concerns on its financial health. EQR has a expensive valuation and it also scores bad on growth.
1. Profitability
1.1 Basic Checks
In the past year EQR was profitable.
EQR had a positive operating cash flow in the past year.
Each year in the past 5 years EQR has been profitable.
EQR had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
EQR has a better Return On Assets (4.80%) than 80.00% of its industry peers.
The Return On Equity of EQR (9.18%) is better than 75.00% of its industry peers.
With a decent Return On Invested Capital value of 3.35%, EQR is doing good in the industry, outperforming 80.00% of the companies in the same industry.
EQR had an Average Return On Invested Capital over the past 3 years of 3.44%. This is in line with the industry average of 2.59%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.8% | ||
| ROE | 9.18% | ||
| ROIC | 3.35% |
ROA(3y)4.31%
ROA(5y)4.74%
ROE(3y)7.93%
ROE(5y)8.91%
ROIC(3y)3.44%
ROIC(5y)3.17%
1.3 Margins
The Profit Margin of EQR (33.17%) is better than 85.00% of its industry peers.
EQR's Profit Margin has been stable in the last couple of years.
EQR has a better Operating Margin (28.12%) than 80.00% of its industry peers.
In the last couple of years the Operating Margin of EQR has declined.
With an excellent Gross Margin value of 63.05%, EQR belongs to the best of the industry, outperforming 90.00% of the companies in the same industry.
EQR's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 28.12% | ||
| PM (TTM) | 33.17% | ||
| GM | 63.05% |
OM growth 3Y5.12%
OM growth 5Y-2.76%
PM growth 3Y-13.73%
PM growth 5Y-0.66%
GM growth 3Y0.95%
GM growth 5Y-0.95%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), EQR is destroying value.
The number of shares outstanding for EQR remains at a similar level compared to 1 year ago.
EQR has more shares outstanding than it did 5 years ago.
The debt/assets ratio for EQR is higher compared to a year ago.
2.2 Solvency
Based on the Altman-Z score of 1.76, we must say that EQR is in the distress zone and has some risk of bankruptcy.
The Altman-Z score of EQR (1.76) is better than 85.00% of its industry peers.
A Debt/Equity ratio of 0.76 indicates that EQR is somewhat dependend on debt financing.
EQR has a Debt to Equity ratio of 0.76. This is in the better half of the industry: EQR outperforms 70.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.76 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 1.76 |
ROIC/WACC0.46
WACC7.26%
2.3 Liquidity
A Current Ratio of 0.02 indicates that EQR may have some problems paying its short term obligations.
EQR has a Current ratio of 0.02. This is amonst the worse of the industry: EQR underperforms 90.00% of its industry peers.
A Quick Ratio of 0.02 indicates that EQR may have some problems paying its short term obligations.
EQR's Quick ratio of 0.02 is on the low side compared to the rest of the industry. EQR is outperformed by 90.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.02 | ||
| Quick Ratio | 0.02 |
3. Growth
3.1 Past
EQR shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 5.58%.
The Earnings Per Share has been growing slightly by 0.98% on average over the past years.
Looking at the last year, EQR shows a small growth in Revenue. The Revenue has grown by 4.40% in the last year.
The Revenue has been growing slightly by 1.99% on average over the past years.
EPS 1Y (TTM)5.58%
EPS 3Y-8.41%
EPS 5Y0.98%
EPS Q2Q%6.38%
Revenue 1Y (TTM)4.4%
Revenue growth 3Y6.54%
Revenue growth 5Y1.99%
Sales Q2Q%4.72%
3.2 Future
The Earnings Per Share is expected to decrease by -9.78% on average over the next years.
The Revenue is expected to grow by 4.80% on average over the next years.
EPS Next Y-30.81%
EPS Next 2Y-24.68%
EPS Next 3Y-11.43%
EPS Next 5Y-9.78%
Revenue Next Year4.34%
Revenue Next 2Y4.17%
Revenue Next 3Y4.08%
Revenue Next 5Y4.8%
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less 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
A Price/Earnings ratio of 24.55 indicates a rather expensive valuation of EQR.
Based on the Price/Earnings ratio, EQR is valued cheaper than 90.00% of the companies in the same industry.
EQR is valuated at similar levels of the S&P average when we compare the Price/Earnings ratio to 27.38, which is the current average of the S&P500 Index.
EQR is valuated quite expensively with a Price/Forward Earnings ratio of 42.16.
Compared to the rest of the industry, the Price/Forward Earnings ratio of EQR indicates a somewhat cheap valuation: EQR is cheaper than 75.00% of the companies listed in the same industry.
EQR is valuated expensively when we compare the Price/Forward Earnings ratio to 22.86, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 24.55 | ||
| Fwd PE | 42.16 |
4.2 Price Multiples
75.00% of the companies in the same industry are more expensive than EQR, based on the Enterprise Value to EBITDA ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 17.46 |
4.3 Compensation for Growth
EQR has a very decent profitability rating, which may justify a higher PE ratio.
EQR's earnings are expected to decrease with -11.43% in the coming years. This may justify a cheaper valuation.
PEG (NY)N/A
PEG (5Y)24.94
EPS Next 2Y-24.68%
EPS Next 3Y-11.43%
5. Dividend
5.1 Amount
EQR has a Yearly Dividend Yield of 4.27%, which is a nice return.
EQR's Dividend Yield is comparable with the industry average which is at 6.22.
Compared to an average S&P500 Dividend Yield of 2.38, EQR pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.27% |
5.2 History
The dividend of EQR has a limited annual growth rate of 3.64%.
EQR has paid a dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)3.64%
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
EQR pays out 102.28% of its income as dividend. This is not a sustainable payout ratio.
The Dividend Rate of EQR has been growing, while earnings will be declining. This means the dividend growth is most likely not sustainable.
DP102.28%
EPS Next 2Y-24.68%
EPS Next 3Y-11.43%
65.05
+0.18 (+0.28%)
Chartmill FA Rating
GICS SectorReal Estate
GICS IndustryGroupEquity Real Estate Investment Trusts (REITs)
GICS IndustryResidential REITs
Earnings (Last)
Earnings (Next)
Inst Owners95.24%
Inst Owner Change-6.98%
Ins Owners0.51%
Ins Owner Change2.34%
Market Cap24.84B
Analysts72.41
Price Target75.72 (16.4%)
Short Float %1.47%
Short Ratio2.78
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.27% |
Yearly Dividend2.69
Dividend Growth(5Y)3.64%
DP102.28%
Div Incr Years0
Div Non Decr Years0
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)79.82%
Min EPS beat(2)35.13%
Max EPS beat(2)124.52%
EPS beat(4)3
Avg EPS beat(4)77.31%
Min EPS beat(4)-10.24%
Max EPS beat(4)159.82%
EPS beat(8)7
Avg EPS beat(8)70.17%
EPS beat(12)10
Avg EPS beat(12)64.86%
EPS beat(16)13
Avg EPS beat(16)79.94%
Revenue beat(2)0
Avg Revenue beat(2)-1.49%
Min Revenue beat(2)-1.81%
Max Revenue beat(2)-1.17%
Revenue beat(4)1
Avg Revenue beat(4)-0.74%
Min Revenue beat(4)-1.81%
Max Revenue beat(4)0.43%
Revenue beat(8)1
Avg Revenue beat(8)-0.81%
Revenue beat(12)1
Avg Revenue beat(12)-0.87%
Revenue beat(16)4
Avg Revenue beat(16)-0.51%
PT rev (1m)-2.93%
PT rev (3m)-4.06%
EPS NQ rev (1m)7.97%
EPS NQ rev (3m)28.02%
EPS NY rev (1m)0%
EPS NY rev (3m)19.44%
Revenue NQ rev (1m)-0.2%
Revenue NQ rev (3m)-0.18%
Revenue NY rev (1m)-0.19%
Revenue NY rev (3m)-0.22%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 24.55 | ||
| Fwd PE | 42.16 | ||
| P/S | 8.16 | ||
| P/FCF | N/A | ||
| P/OCF | 16.12 | ||
| P/B | 2.26 | ||
| P/tB | 2.26 | ||
| EV/EBITDA | 17.46 |
EPS(TTM)2.65
EY4.07%
EPS(NY)1.54
Fwd EY2.37%
FCF(TTM)-2.5
FCFYN/A
OCF(TTM)4.03
OCFY6.2%
SpS7.97
BVpS28.82
TBVpS28.82
PEG (NY)N/A
PEG (5Y)24.94
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.8% | ||
| ROE | 9.18% | ||
| ROCE | 4.41% | ||
| ROIC | 3.35% | ||
| ROICexc | 3.36% | ||
| ROICexgc | 3.4% | ||
| OM | 28.12% | ||
| PM (TTM) | 33.17% | ||
| GM | 63.05% | ||
| FCFM | N/A |
ROA(3y)4.31%
ROA(5y)4.74%
ROE(3y)7.93%
ROE(5y)8.91%
ROIC(3y)3.44%
ROIC(5y)3.17%
ROICexc(3y)3.45%
ROICexc(5y)3.18%
ROICexgc(3y)3.5%
ROICexgc(5y)3.23%
ROCE(3y)4.43%
ROCE(5y)4.09%
ROICexcg growth 3Y12.87%
ROICexcg growth 5Y-0.44%
ROICexc growth 3Y12.89%
ROICexc growth 5Y-0.48%
OM growth 3Y5.12%
OM growth 5Y-2.76%
PM growth 3Y-13.73%
PM growth 5Y-0.66%
GM growth 3Y0.95%
GM growth 5Y-0.95%
F-Score3
Asset Turnover0.14
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.76 | ||
| Debt/FCF | N/A | ||
| Debt/EBITDA | 4.51 | ||
| Cap/Depr | 249.68% | ||
| Cap/Sales | 81.98% | ||
| Interest Coverage | 3.37 | ||
| Cash Conversion | 83.02% | ||
| Profit Quality | N/A | ||
| Current Ratio | 0.02 | ||
| Quick Ratio | 0.02 | ||
| Altman-Z | 1.76 |
F-Score3
WACC7.26%
ROIC/WACC0.46
Cap/Depr(3y)115.1%
Cap/Depr(5y)129.08%
Cap/Sales(3y)36.55%
Cap/Sales(5y)42.13%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)5.58%
EPS 3Y-8.41%
EPS 5Y0.98%
EPS Q2Q%6.38%
EPS Next Y-30.81%
EPS Next 2Y-24.68%
EPS Next 3Y-11.43%
EPS Next 5Y-9.78%
Revenue 1Y (TTM)4.4%
Revenue growth 3Y6.54%
Revenue growth 5Y1.99%
Sales Q2Q%4.72%
Revenue Next Year4.34%
Revenue Next 2Y4.17%
Revenue Next 3Y4.08%
Revenue Next 5Y4.8%
EBIT growth 1Y-4.68%
EBIT growth 3Y12%
EBIT growth 5Y-0.83%
EBIT Next Year103.93%
EBIT Next 3Y30.57%
EBIT Next 5Y18.75%
FCF growth 1Y-201.06%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y2.04%
OCF growth 3Y7.68%
OCF growth 5Y1.55%