ELECTRONIC ARTS INC (ERT.DE) Stock Fundamental Analysis
FRA:ERT - Deutsche Boerse Ag - US2855121099 - Common Stock - Currency: EUR
Overall ERT gets a fundamental rating of 6 out of 10. We evaluated ERT against 45 industry peers in the Entertainment industry. Both the health and profitability get an excellent rating, making ERT a very profitable company, without any liquidiy or solvency issues. ERT is not valued too expensively and it also shows a decent growth rate.
1. Profitability
1.1 Basic Checks
ERT had positive earnings in the past year.
In the past year ERT had a positive cash flow from operations.
ERT had positive earnings in each of the past 5 years.
Each year in the past 5 years ERT had a positive operating cash flow.
1.2 Ratios
The Return On Assets of ERT (9.06%) is better than 93.33% of its industry peers.
ERT has a Return On Equity of 17.55%. This is in the better half of the industry: ERT outperforms 80.00% of its industry peers.
The Return On Invested Capital of ERT (13.27%) is better than 86.67% of its industry peers.
The Average Return On Invested Capital over the past 3 years for ERT is above the industry average of 10.04%.
The 3 year average ROIC (12.06%) for ERT is below the current ROIC(13.27%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 9.06% | ||
| ROE | 17.55% | ||
| ROIC | 13.27% |
ROA(3y)8.17%
ROA(5y)7.3%
ROE(3y)15.16%
ROE(5y)13.3%
ROIC(3y)12.06%
ROIC(5y)10.47%
1.3 Margins
ERT has a Profit Margin of 15.02%. This is amongst the best in the industry. ERT outperforms 86.67% of its industry peers.
In the last couple of years the Profit Margin of ERT has declined.
The Operating Margin of ERT (21.13%) is better than 93.33% of its industry peers.
ERT's Operating Margin has declined in the last couple of years.
ERT has a Gross Margin of 79.32%. This is in the better half of the industry: ERT outperforms 68.89% of its industry peers.
ERT's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 21.13% | ||
| PM (TTM) | 15.02% | ||
| GM | 79.32% |
OM growth 3Y7.96%
OM growth 5Y-4.32%
PM growth 3Y10%
PM growth 5Y-22.83%
GM growth 3Y2.54%
GM growth 5Y1.05%
2. Health
2.1 Basic Checks
ERT has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
The number of shares outstanding for ERT has been reduced compared to 1 year ago.
Compared to 5 years ago, ERT has less shares outstanding
The debt/assets ratio for ERT is higher compared to a year ago.
2.2 Solvency
An Altman-Z score of 5.73 indicates that ERT is not in any danger for bankruptcy at the moment.
ERT has a better Altman-Z score (5.73) than 88.89% of its industry peers.
The Debt to FCF ratio of ERT is 1.01, which is an excellent value as it means it would take ERT, only 1.01 years of fcf income to pay off all of its debts.
ERT has a Debt to FCF ratio of 1.01. This is amongst the best in the industry. ERT outperforms 88.89% of its industry peers.
A Debt/Equity ratio of 0.23 indicates that ERT is not too dependend on debt financing.
With a decent Debt to Equity ratio value of 0.23, ERT is doing good in the industry, outperforming 71.11% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.23 | ||
| Debt/FCF | 1.01 | ||
| Altman-Z | 5.73 |
ROIC/WACC1.56
WACC8.52%
2.3 Liquidity
ERT has a Current Ratio of 0.95. This is a bad value and indicates that ERT is not financially healthy enough and could expect problems in meeting its short term obligations.
ERT has a Current ratio of 0.95. This is comparable to the rest of the industry: ERT outperforms 60.00% of its industry peers.
ERT has a Quick Ratio of 0.95. This is a bad value and indicates that ERT is not financially healthy enough and could expect problems in meeting its short term obligations.
ERT has a Quick ratio (0.95) which is comparable to the rest of the industry.
ERT does not score too well on the current and quick ratio evaluation. However, as it has excellent solvency and profitability, these ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.95 | ||
| Quick Ratio | 0.95 |
3. Growth
3.1 Past
ERT shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 0.79%.
The Earnings Per Share has been growing slightly by 6.84% on average over the past years.
ERT shows a decrease in Revenue. In the last year, the revenue decreased by -1.31%.
Measured over the past years, ERT shows a small growth in Revenue. The Revenue has been growing by 6.15% on average per year.
EPS 1Y (TTM)0.79%
EPS 3Y-1.54%
EPS 5Y6.84%
EPS Q2Q%-67.31%
Revenue 1Y (TTM)-1.31%
Revenue growth 3Y2.2%
Revenue growth 5Y6.15%
Sales Q2Q%2.85%
3.2 Future
The Earnings Per Share is expected to grow by 9.25% on average over the next years. This is quite good.
ERT is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 4.10% yearly.
EPS Next Y23.39%
EPS Next 2Y16.81%
EPS Next 3Y14.28%
EPS Next 5Y9.25%
Revenue Next Year9.22%
Revenue Next 2Y7.5%
Revenue Next 3Y6.35%
Revenue Next 5Y4.1%
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 decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 25.83, which means the current valuation is very expensive for ERT.
ERT's Price/Earnings ratio is a bit cheaper when compared to the industry. ERT is cheaper than 75.56% of the companies in the same industry.
ERT's Price/Earnings ratio indicates a similar valuation than the S&P500 average which is at 27.03.
ERT is valuated rather expensively with a Price/Forward Earnings ratio of 17.95.
ERT's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. ERT is cheaper than 71.11% of the companies in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 36.28, ERT is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 25.83 | ||
| Fwd PE | 17.95 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of ERT is on the same level as its industry peers.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of ERT indicates a somewhat cheap valuation: ERT is cheaper than 66.67% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 22.22 | ||
| EV/EBITDA | 20.35 |
4.3 Compensation for Growth
ERT's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
The excellent profitability rating of ERT may justify a higher PE ratio.
ERT's earnings are expected to grow with 14.28% in the coming years. This may justify a more expensive valuation.
PEG (NY)1.1
PEG (5Y)3.78
EPS Next 2Y16.81%
EPS Next 3Y14.28%
5. Dividend
5.1 Amount
ERT has a yearly dividend return of 0.50%, which is pretty low.
Compared to an average industry Dividend Yield of 2.58, ERT pays a bit more dividend than its industry peers.
With a Dividend Yield of 0.50, ERT pays less dividend than the S&P500 average, which is at 2.40.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.5% |
5.2 History
Dividend Growth(5Y)N/A
Div Incr Years0
Div Non Decr Years4
5.3 Sustainability
17.75% of the earnings are spent on dividend by ERT. This is a low number and sustainable payout ratio.
DP17.75%
EPS Next 2Y16.81%
EPS Next 3Y14.28%
FRA:ERT (8/6/2025, 9:17:46 AM)
142.32
+5.06 (+3.69%)
Chartmill FA Rating
GICS SectorCommunication Services
GICS IndustryGroupMedia & Entertainment
GICS IndustryEntertainment
Earnings (Last)
Earnings (Next)
Inst Owners102.66%
Inst Owner ChangeN/A
Ins Owners0.2%
Ins Owner ChangeN/A
Market Cap35.76B
Analysts75.79
Price Target147.38 (3.56%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.5% |
Yearly Dividend0.67
Dividend Growth(5Y)N/A
DP17.75%
Div Incr Years0
Div Non Decr Years4
Ex-DateN/A
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-1.26%
Min EPS beat(2)-10.5%
Max EPS beat(2)7.97%
EPS beat(4)3
Avg EPS beat(4)5.46%
Min EPS beat(4)-10.5%
Max EPS beat(4)21.09%
EPS beat(8)5
Avg EPS beat(8)3.61%
EPS beat(12)8
Avg EPS beat(12)9.46%
EPS beat(16)10
Avg EPS beat(16)9.74%
Revenue beat(2)1
Avg Revenue beat(2)2.15%
Min Revenue beat(2)-7.44%
Max Revenue beat(2)11.74%
Revenue beat(4)1
Avg Revenue beat(4)-0.32%
Min Revenue beat(4)-7.44%
Max Revenue beat(4)11.74%
Revenue beat(8)1
Avg Revenue beat(8)-2.19%
Revenue beat(12)4
Avg Revenue beat(12)-0.18%
Revenue beat(16)6
Avg Revenue beat(16)-1.15%
PT rev (1m)-1.24%
PT rev (3m)11.33%
EPS NQ rev (1m)6.03%
EPS NQ rev (3m)-79.45%
EPS NY rev (1m)-1.53%
EPS NY rev (3m)7.71%
Revenue NQ rev (1m)3.04%
Revenue NQ rev (3m)0.61%
Revenue NY rev (1m)-0.41%
Revenue NY rev (3m)2.72%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 25.83 | ||
| Fwd PE | 17.95 | ||
| P/S | 5.53 | ||
| P/FCF | 22.22 | ||
| P/OCF | 19.86 | ||
| P/B | 6.47 | ||
| P/tB | 57.59 | ||
| EV/EBITDA | 20.35 |
EPS(TTM)5.51
EY3.87%
EPS(NY)7.93
Fwd EY5.57%
FCF(TTM)6.4
FCFY4.5%
OCF(TTM)7.17
OCFY5.04%
SpS25.72
BVpS22.01
TBVpS2.47
PEG (NY)1.1
PEG (5Y)3.78
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 9.06% | ||
| ROE | 17.55% | ||
| ROCE | 17.7% | ||
| ROIC | 13.27% | ||
| ROICexc | 17.75% | ||
| ROICexgc | 119.2% | ||
| OM | 21.13% | ||
| PM (TTM) | 15.02% | ||
| GM | 79.32% | ||
| FCFM | 24.9% |
ROA(3y)8.17%
ROA(5y)7.3%
ROE(3y)15.16%
ROE(5y)13.3%
ROIC(3y)12.06%
ROIC(5y)10.47%
ROICexc(3y)16.76%
ROICexc(5y)16.45%
ROICexgc(3y)98.03%
ROICexgc(5y)99%
ROCE(3y)16.08%
ROCE(5y)13.96%
ROICexcg growth 3Y5.86%
ROICexcg growth 5Y-3.33%
ROICexc growth 3Y13.37%
ROICexc growth 5Y-15.13%
OM growth 3Y7.96%
OM growth 5Y-4.32%
PM growth 3Y10%
PM growth 5Y-22.83%
GM growth 3Y2.54%
GM growth 5Y1.05%
F-Score7
Asset Turnover0.6
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.23 | ||
| Debt/FCF | 1.01 | ||
| Debt/EBITDA | 0.77 | ||
| Cap/Depr | 62.08% | ||
| Cap/Sales | 2.96% | ||
| Interest Coverage | 28.16 | ||
| Cash Conversion | 107.55% | ||
| Profit Quality | 165.75% | ||
| Current Ratio | 0.95 | ||
| Quick Ratio | 0.95 | ||
| Altman-Z | 5.73 |
F-Score7
WACC8.52%
ROIC/WACC1.56
Cap/Depr(3y)49.99%
Cap/Depr(5y)51.43%
Cap/Sales(3y)2.79%
Cap/Sales(5y)2.65%
Profit Quality(3y)166.47%
Profit Quality(5y)186.51%
High Growth Momentum
Growth
EPS 1Y (TTM)0.79%
EPS 3Y-1.54%
EPS 5Y6.84%
EPS Q2Q%-67.31%
EPS Next Y23.39%
EPS Next 2Y16.81%
EPS Next 3Y14.28%
EPS Next 5Y9.25%
Revenue 1Y (TTM)-1.31%
Revenue growth 3Y2.2%
Revenue growth 5Y6.15%
Sales Q2Q%2.85%
Revenue Next Year9.22%
Revenue Next 2Y7.5%
Revenue Next 3Y6.35%
Revenue Next 5Y4.1%
EBIT growth 1Y-4.42%
EBIT growth 3Y10.34%
EBIT growth 5Y1.57%
EBIT Next Year36.25%
EBIT Next 3Y14.8%
EBIT Next 5Y11.53%
FCF growth 1Y-12.19%
FCF growth 3Y2.79%
FCF growth 5Y2.32%
OCF growth 1Y-10.19%
OCF growth 3Y3.06%
OCF growth 5Y2.96%