EQUITY RESIDENTIAL (EQR) Stock Fundamental Analysis
NYSE:EQR - New York Stock Exchange, Inc. - US29476L1070 - REIT - Currency: USD
Taking everything into account, EQR scores 4 out of 10 in our fundamental rating. 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. While showing a medium growth rate, EQR is valued expensive at the moment.
1. Profitability
1.1 Basic Checks
In the past year EQR was profitable.
EQR had a positive operating cash flow in the past year.
In the past 5 years EQR has always been profitable.
Each year in the past 5 years EQR had a positive operating cash flow.
1.2 Ratios
The Return On Assets of EQR (4.84%) is better than 85.00% of its industry peers.
EQR has a better Return On Equity (9.01%) than 80.00% of its industry peers.
EQR has a Return On Invested Capital of 3.43%. This is amongst the best in the industry. EQR outperforms 85.00% of its industry peers.
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 2.62%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.84% | ||
| ROE | 9.01% | ||
| ROIC | 3.43% |
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
EQR has a Profit Margin of 33.06%. This is amongst the best in the industry. EQR outperforms 90.00% of its industry peers.
EQR's Profit Margin has been stable in the last couple of years.
With a decent Operating Margin value of 28.42%, EQR is doing good in the industry, outperforming 80.00% of the companies in the same industry.
EQR's Operating Margin has declined in the last couple of years.
EQR's Gross Margin of 63.22% is amongst the best of the industry. EQR outperforms 85.00% of its industry peers.
EQR's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 28.42% | ||
| PM (TTM) | 33.06% | ||
| GM | 63.22% |
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
EQR has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
Compared to 1 year ago, EQR has about the same amount of shares outstanding.
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
EQR has an Altman-Z score of 1.92. This is not the best score and indicates that EQR is in the grey zone with still only limited risk for bankruptcy at the moment.
EQR has a Altman-Z score of 1.92. This is amongst the best in the industry. EQR outperforms 85.00% of its industry peers.
EQR has a Debt/Equity ratio of 0.71. This is a neutral value indicating EQR is somewhat dependend on debt financing.
With a decent Debt to Equity ratio value of 0.71, EQR is doing good in the industry, outperforming 75.00% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.71 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 1.92 |
ROIC/WACC0.46
WACC7.44%
2.3 Liquidity
A Current Ratio of 0.03 indicates that EQR may have some problems paying its short term obligations.
EQR has a Current ratio of 0.03. This is amonst the worse of the industry: EQR underperforms 90.00% of its industry peers.
A Quick Ratio of 0.03 indicates that EQR may have some problems paying its short term obligations.
With a Quick ratio value of 0.03, EQR is not doing good in the industry: 90.00% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.03 | ||
| Quick Ratio | 0.03 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 8.71% over the past year.
Measured over the past 5 years, EQR shows a small growth in Earnings Per Share. The EPS has been growing by 0.98% on average per year.
The Revenue has been growing slightly by 3.81% in the past year.
EQR shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 1.99% yearly.
EPS 1Y (TTM)8.71%
EPS 3Y-8.41%
EPS 5Y0.98%
EPS Q2Q%-12.99%
Revenue 1Y (TTM)3.81%
Revenue growth 3Y6.54%
Revenue growth 5Y1.99%
Sales Q2Q%4.1%
3.2 Future
The Earnings Per Share is expected to decrease by -11.05% on average over the next years. This is quite bad
The Revenue is expected to grow by 4.88% on average over the next years.
EPS Next Y-42.07%
EPS Next 2Y-29.46%
EPS Next 3Y-17.36%
EPS Next 5Y-11.05%
Revenue Next Year4.57%
Revenue Next 2Y4.42%
Revenue Next 3Y4.27%
Revenue Next 5Y4.88%
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 decreasing.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 25.49, which means the current valuation is very expensive for EQR.
EQR's Price/Earnings ratio is rather cheap when compared to the industry. EQR is cheaper than 95.00% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 27.30, EQR is valued at the same level.
A Price/Forward Earnings ratio of 49.35 indicates a quite expensive valuation of EQR.
Based on the Price/Forward Earnings ratio, EQR is valued a bit cheaper than 70.00% of the companies in the same industry.
EQR is valuated expensively when we compare the Price/Forward Earnings ratio to 21.76, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 25.49 | ||
| Fwd PE | 49.35 |
4.2 Price Multiples
EQR's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. EQR is cheaper than 80.00% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 17.94 |
4.3 Compensation for Growth
EQR has a very decent profitability rating, which may justify a higher PE ratio.
A cheap valuation may be justified as EQR's earnings are expected to decrease with -17.36% in the coming years.
PEG (NY)N/A
PEG (5Y)25.9
EPS Next 2Y-29.46%
EPS Next 3Y-17.36%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 4.14%, EQR is a good candidate for dividend investing.
EQR's Dividend Yield is comparable with the industry average which is at 4.66.
EQR's Dividend Yield is rather good when compared to the S&P500 average which is at 2.37.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.14% |
5.2 History
The dividend of EQR has a limited annual growth rate of 3.64%.
EQR has been paying a dividend for at least 10 years, so it has a reliable track record.
Dividend Growth(5Y)3.64%
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
EQR pays out 103.08% 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.
DP103.08%
EPS Next 2Y-29.46%
EPS Next 3Y-17.36%
66.79
-0.29 (-0.43%)
Chartmill FA Rating
GICS SectorReal Estate
GICS IndustryGroupEquity Real Estate Investment Trusts (REITs)
GICS IndustryResidential REITs
Earnings (Last)
Earnings (Next)
Inst Owners95.14%
Inst Owner Change0%
Ins Owners0.54%
Ins Owner Change3.12%
Market Cap25.38B
Analysts71.33
Price Target78.92 (18.16%)
Short Float %1.31%
Short Ratio2.46
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.14% |
Yearly Dividend2.69
Dividend Growth(5Y)3.64%
DP103.08%
Div Incr Years0
Div Non Decr Years0
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)142.17%
Min EPS beat(2)124.52%
Max EPS beat(2)159.82%
EPS beat(4)3
Avg EPS beat(4)73.87%
Min EPS beat(4)-10.24%
Max EPS beat(4)159.82%
EPS beat(8)6
Avg EPS beat(8)65.49%
EPS beat(12)10
Avg EPS beat(12)70.33%
EPS beat(16)13
Avg EPS beat(16)92.75%
Revenue beat(2)1
Avg Revenue beat(2)-0.69%
Min Revenue beat(2)-1.81%
Max Revenue beat(2)0.43%
Revenue beat(4)1
Avg Revenue beat(4)-0.7%
Min Revenue beat(4)-1.81%
Max Revenue beat(4)0.43%
Revenue beat(8)1
Avg Revenue beat(8)-0.77%
Revenue beat(12)2
Avg Revenue beat(12)-0.68%
Revenue beat(16)5
Avg Revenue beat(16)-0.42%
PT rev (1m)0.42%
PT rev (3m)-0.82%
EPS NQ rev (1m)4.72%
EPS NQ rev (3m)6.57%
EPS NY rev (1m)15.06%
EPS NY rev (3m)18.04%
Revenue NQ rev (1m)-0.07%
Revenue NQ rev (3m)-0.85%
Revenue NY rev (1m)-0.13%
Revenue NY rev (3m)-0.82%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 25.49 | ||
| Fwd PE | 49.35 | ||
| P/S | 8.43 | ||
| P/FCF | N/A | ||
| P/OCF | 16.08 | ||
| P/B | 2.3 | ||
| P/tB | 2.3 | ||
| EV/EBITDA | 17.94 |
EPS(TTM)2.62
EY3.92%
EPS(NY)1.35
Fwd EY2.03%
FCF(TTM)-1.17
FCFYN/A
OCF(TTM)4.15
OCFY6.22%
SpS7.92
BVpS29.08
TBVpS29.08
PEG (NY)N/A
PEG (5Y)25.9
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.84% | ||
| ROE | 9.01% | ||
| ROCE | 4.41% | ||
| ROIC | 3.43% | ||
| ROICexc | 3.44% | ||
| ROICexgc | 3.48% | ||
| OM | 28.42% | ||
| PM (TTM) | 33.06% | ||
| GM | 63.22% | ||
| 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-Score5
Asset Turnover0.15
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.71 | ||
| Debt/FCF | N/A | ||
| Debt/EBITDA | 4.27 | ||
| Cap/Depr | 205.71% | ||
| Cap/Sales | 67.19% | ||
| Interest Coverage | 3.38 | ||
| Cash Conversion | 85.82% | ||
| Profit Quality | N/A | ||
| Current Ratio | 0.03 | ||
| Quick Ratio | 0.03 | ||
| Altman-Z | 1.92 |
F-Score5
WACC7.44%
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)8.71%
EPS 3Y-8.41%
EPS 5Y0.98%
EPS Q2Q%-12.99%
EPS Next Y-42.07%
EPS Next 2Y-29.46%
EPS Next 3Y-17.36%
EPS Next 5Y-11.05%
Revenue 1Y (TTM)3.81%
Revenue growth 3Y6.54%
Revenue growth 5Y1.99%
Sales Q2Q%4.1%
Revenue Next Year4.57%
Revenue Next 2Y4.42%
Revenue Next 3Y4.27%
Revenue Next 5Y4.88%
EBIT growth 1Y-3.98%
EBIT growth 3Y12%
EBIT growth 5Y-0.83%
EBIT Next Year104.14%
EBIT Next 3Y30.63%
EBIT Next 5Y18.75%
FCF growth 1Y-139.22%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y6.63%
OCF growth 3Y7.68%
OCF growth 5Y1.55%