ELECTRONIC ARTS INC (ERT.DE) Stock Fundamental Analysis
Europe - FRA:ERT - US2855121099 - Common Stock
171.94 EUR
-0.08 (-0.05%)
We assign a fundamental rating of 6 out of 10 to ERT. ERT was compared to 43 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 has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
ERT had positive earnings in the past year.
ERT had a positive operating cash flow in the past year.
Each year in the past 5 years ERT has been profitable.
ERT had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
ERT has a better Return On Assets (8.91%) than 93.02% of its industry peers.
Looking at the Return On Equity, with a value of 17.13%, ERT belongs to the top of the industry, outperforming 81.40% of the companies in the same industry.
The Return On Invested Capital of ERT (12.83%) is better than 86.05% of its industry peers.
ERT had an Average Return On Invested Capital over the past 3 years of 12.06%. This is in line with the industry average of 10.18%.
The 3 year average ROIC (12.06%) for ERT is below the current ROIC(12.83%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.91% | ||
| ROE | 17.13% | ||
| ROIC | 12.83% |
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 better Profit Margin (13.94%) than 83.72% of its industry peers.
In the last couple of years the Profit Margin of ERT has declined.
The Operating Margin of ERT (19.83%) is better than 93.02% of its industry peers.
In the last couple of years the Operating Margin of ERT has declined.
ERT has a better Gross Margin (79.14%) than 67.44% of its industry peers.
In the last couple of years the Gross Margin of ERT has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 19.83% | ||
| PM (TTM) | 13.94% | ||
| GM | 79.14% |
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
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so ERT is still creating some value.
ERT has less shares outstanding than it did 1 year ago.
Compared to 5 years ago, ERT has less shares outstanding
Compared to 1 year ago, ERT has a worse debt to assets ratio.
2.2 Solvency
An Altman-Z score of 7.15 indicates that ERT is not in any danger for bankruptcy at the moment.
ERT's Altman-Z score of 7.15 is amongst the best of the industry. ERT outperforms 88.37% of its industry peers.
The Debt to FCF ratio of ERT is 1.08, which is an excellent value as it means it would take ERT, only 1.08 years of fcf income to pay off all of its debts.
Looking at the Debt to FCF ratio, with a value of 1.08, ERT belongs to the top of the industry, outperforming 88.37% of the companies in the same industry.
ERT has a Debt/Equity ratio of 0.24. This is a healthy value indicating a solid balance between debt and equity.
ERT has a Debt to Equity ratio of 0.24. This is in the better half of the industry: ERT outperforms 69.77% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.24 | ||
| Debt/FCF | 1.08 | ||
| Altman-Z | 7.15 |
ROIC/WACC1.51
WACC8.51%
2.3 Liquidity
ERT has a Current Ratio of 0.84. 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's Current ratio of 0.84 is in line compared to the rest of the industry. ERT outperforms 46.51% of its industry peers.
ERT has a Quick Ratio of 0.84. This is a bad value and indicates that ERT is not financially healthy enough and could expect problems in meeting its short term obligations.
Looking at the Quick ratio, with a value of 0.84, ERT is in line with its industry, outperforming 48.84% of the companies in the same industry.
The current and quick ratio evaluation for ERT is rather negative, while it does have 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 | 0.84 | ||
| Quick Ratio | 0.84 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 2.06% over the past year.
ERT shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 6.84% yearly.
The Revenue has been growing slightly by 2.41% in the past year.
ERT shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 6.15% yearly.
EPS 1Y (TTM)2.06%
EPS 3Y-1.54%
EPS 5Y6.84%
EPS Q2Q%-51.92%
Revenue 1Y (TTM)2.41%
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.
The Revenue is expected to grow by 4.40% on average over the next years.
EPS Next Y26.96%
EPS Next 2Y17.76%
EPS Next 3Y15.17%
EPS Next 5Y9.25%
Revenue Next Year10.5%
Revenue Next 2Y7.58%
Revenue Next 3Y6.58%
Revenue Next 5Y4.4%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 31.32 indicates a quite expensive valuation of ERT.
74.42% of the companies in the same industry are more expensive than ERT, based on the Price/Earnings ratio.
Compared to an average S&P500 Price/Earnings ratio of 27.79, ERT is valued at the same level.
The Price/Forward Earnings ratio is 21.69, which indicates a rather expensive current valuation of ERT.
ERT's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. ERT is cheaper than 76.74% of the companies in the same industry.
ERT is valuated at similar levels of the S&P average when we compare the Price/Forward Earnings ratio to 23.21, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 31.32 | ||
| Fwd PE | 21.69 |
4.2 Price Multiples
60.47% of the companies in the same industry are cheaper than ERT, based on the Enterprise Value to EBITDA ratio.
ERT's Price/Free Cash Flow is on the same level as the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 28.86 | ||
| EV/EBITDA | 27.59 |
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 15.17% in the coming years. This may justify a more expensive valuation.
PEG (NY)1.16
PEG (5Y)4.58
EPS Next 2Y17.76%
EPS Next 3Y15.17%
5. Dividend
5.1 Amount
ERT has a yearly dividend return of 0.45%, which is pretty low.
ERT's Dividend Yield is a higher than the industry average which is at 2.36.
With a Dividend Yield of 0.45, ERT pays less dividend than the S&P500 average, which is at 2.41.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.45% |
5.2 History
Dividend Growth(5Y)N/A
Div Incr Years0
Div Non Decr Years4
5.3 Sustainability
ERT pays out 18.91% of its income as dividend. This is a sustainable payout ratio.
DP18.91%
EPS Next 2Y17.76%
EPS Next 3Y15.17%
FRA:ERT (10/1/2025, 11:45:30 AM)
171.94
-0.08 (-0.05%)
Chartmill FA Rating
GICS SectorCommunication Services
GICS IndustryGroupMedia & Entertainment
GICS IndustryEntertainment
Earnings (Last)
Earnings (Next)
Inst Owners103.56%
Inst Owner ChangeN/A
Ins Owners0.19%
Ins Owner ChangeN/A
Market Cap43.02B
Analysts76
Price Target152.37 (-11.38%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.45% |
Yearly Dividend0.66
Dividend Growth(5Y)N/A
DP18.91%
Div Incr Years0
Div Non Decr Years4
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)65.17%
Min EPS beat(2)7.97%
Max EPS beat(2)122.37%
EPS beat(4)3
Avg EPS beat(4)30.78%
Min EPS beat(4)-10.5%
Max EPS beat(4)122.37%
EPS beat(8)5
Avg EPS beat(8)17.91%
EPS beat(12)8
Avg EPS beat(12)14.56%
EPS beat(16)10
Avg EPS beat(16)16.44%
Revenue beat(2)1
Avg Revenue beat(2)4.92%
Min Revenue beat(2)-1.89%
Max Revenue beat(2)11.74%
Revenue beat(4)1
Avg Revenue beat(4)0.36%
Min Revenue beat(4)-7.44%
Max Revenue beat(4)11.74%
Revenue beat(8)1
Avg Revenue beat(8)-1.98%
Revenue beat(12)3
Avg Revenue beat(12)-3.38%
Revenue beat(16)5
Avg Revenue beat(16)-2.36%
PT rev (1m)1.39%
PT rev (3m)2.11%
EPS NQ rev (1m)0.38%
EPS NQ rev (3m)-39.92%
EPS NY rev (1m)2.01%
EPS NY rev (3m)1.32%
Revenue NQ rev (1m)0.16%
Revenue NQ rev (3m)-8.02%
Revenue NY rev (1m)0.18%
Revenue NY rev (3m)0.76%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 31.32 | ||
| Fwd PE | 21.69 | ||
| P/S | 6.76 | ||
| P/FCF | 28.86 | ||
| P/OCF | 25.56 | ||
| P/B | 8.31 | ||
| P/tB | 119.69 | ||
| EV/EBITDA | 27.59 |
EPS(TTM)5.49
EY3.19%
EPS(NY)7.93
Fwd EY4.61%
FCF(TTM)5.96
FCFY3.46%
OCF(TTM)6.73
OCFY3.91%
SpS25.44
BVpS20.7
TBVpS1.44
PEG (NY)1.16
PEG (5Y)4.58
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.91% | ||
| ROE | 17.13% | ||
| ROCE | 17.12% | ||
| ROIC | 12.83% | ||
| ROICexc | 15.81% | ||
| ROICexgc | 81.17% | ||
| OM | 19.83% | ||
| PM (TTM) | 13.94% | ||
| GM | 79.14% | ||
| FCFM | 23.41% |
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 Turnover0.64
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.24 | ||
| Debt/FCF | 1.08 | ||
| Debt/EBITDA | 0.81 | ||
| Cap/Depr | 63.66% | ||
| Cap/Sales | 3.02% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 107.57% | ||
| Profit Quality | 167.95% | ||
| Current Ratio | 0.84 | ||
| Quick Ratio | 0.84 | ||
| Altman-Z | 7.15 |
F-Score7
WACC8.51%
ROIC/WACC1.51
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)2.06%
EPS 3Y-1.54%
EPS 5Y6.84%
EPS Q2Q%-51.92%
EPS Next Y26.96%
EPS Next 2Y17.76%
EPS Next 3Y15.17%
EPS Next 5Y9.25%
Revenue 1Y (TTM)2.41%
Revenue growth 3Y2.2%
Revenue growth 5Y6.15%
Sales Q2Q%2.85%
Revenue Next Year10.5%
Revenue Next 2Y7.58%
Revenue Next 3Y6.58%
Revenue Next 5Y4.4%
EBIT growth 1Y0.61%
EBIT growth 3Y10.34%
EBIT growth 5Y1.57%
EBIT Next Year36.3%
EBIT Next 3Y15.72%
EBIT Next 5Y11.34%
FCF growth 1Y-2.45%
FCF growth 3Y2.79%
FCF growth 5Y2.32%
OCF growth 1Y-0.55%
OCF growth 3Y3.06%
OCF growth 5Y2.96%