ELEMENT SOLUTIONS INC (ESI)
US28618M1062 - Common Stock
Overall ESI gets a fundamental rating of 5 out of 10. We evaluated ESI against 84 industry peers in the Chemicals industry. ESI has only an average score on both its financial health and profitability. ESI has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
ESI had positive earnings in the past year.
ESI had a positive operating cash flow in the past year.
Each year in the past 5 years ESI has been profitable.
Each year in the past 5 years ESI had a positive operating cash flow.
1.2 Ratios
ESI has a Return On Assets (2.67%) which is comparable to the rest of the industry.
ESI's Return On Equity of 5.65% is in line compared to the rest of the industry. ESI outperforms 53.57% of its industry peers.
With a Return On Invested Capital value of 4.59%, ESI perfoms like the industry average, outperforming 52.38% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for ESI is below the industry average of 7.44%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.67% | ||
| ROE | 5.65% | ||
| ROIC | 4.59% |
ROA(3y)3.38%
ROA(5y)2.79%
ROE(3y)7.1%
ROE(5y)5.74%
ROIC(3y)5.01%
ROIC(5y)4.87%
1.3 Margins
ESI has a Profit Margin of 5.62%. This is in the better half of the industry: ESI outperforms 64.29% of its industry peers.
In the last couple of years the Profit Margin of ESI has grown nicely.
ESI has a better Operating Margin (11.35%) than 65.48% of its industry peers.
In the last couple of years the Operating Margin of ESI has declined.
ESI has a Gross Margin of 40.09%. This is amongst the best in the industry. ESI outperforms 80.95% of its industry peers.
In the last couple of years the Gross Margin of ESI has declined.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 11.35% | ||
| PM (TTM) | 5.62% | ||
| GM | 40.09% |
OM growth 3Y-4.69%
OM growth 5Y-3.02%
PM growth 3Y7.42%
PM growth 5YN/A
GM growth 3Y-2.45%
GM growth 5Y-1.62%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so ESI is destroying value.
Compared to 1 year ago, ESI has more shares outstanding
Compared to 5 years ago, ESI has less shares outstanding
The debt/assets ratio for ESI is higher compared to a year ago.
2.2 Solvency
An Altman-Z score of 1.88 indicates that ESI is not a great score, but indicates only limited risk for bankruptcy at the moment.
With a Altman-Z score value of 1.88, ESI perfoms like the industry average, outperforming 41.67% of the companies in the same industry.
ESI has a debt to FCF ratio of 6.95. This is a slightly negative value and a sign of low solvency as ESI would need 6.95 years to pay back of all of its debts.
ESI's Debt to FCF ratio of 6.95 is in line compared to the rest of the industry. ESI outperforms 58.33% of its industry peers.
A Debt/Equity ratio of 0.83 indicates that ESI is somewhat dependend on debt financing.
The Debt to Equity ratio of ESI (0.83) is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.83 | ||
| Debt/FCF | 6.95 | ||
| Altman-Z | 1.88 |
ROIC/WACC0.62
WACC7.44%
2.3 Liquidity
ESI has a Current Ratio of 3.63. This indicates that ESI is financially healthy and has no problem in meeting its short term obligations.
ESI has a Current ratio of 3.63. This is amongst the best in the industry. ESI outperforms 84.52% of its industry peers.
ESI has a Quick Ratio of 2.69. This indicates that ESI is financially healthy and has no problem in meeting its short term obligations.
ESI's Quick ratio of 2.69 is amongst the best of the industry. ESI outperforms 83.33% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 3.63 | ||
| Quick Ratio | 2.69 |
3. Growth
3.1 Past
ESI shows a slight negative growth in Earnings Per Share. In the last year, the EPS has decreased by 0.00%.
ESI shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 19.47% yearly.
ESI shows a decrease in Revenue. In the last year, the revenue decreased by -4.49%.
The Revenue has been growing slightly by 3.54% on average over the past years.
EPS 1Y (TTM)0%
EPS 3Y10.35%
EPS 5Y19.47%
EPS growth Q2Q13.33%
Revenue 1Y (TTM)-4.49%
Revenue growth 3Y7.97%
Revenue growth 5Y3.54%
Revenue growth Q2Q0.1%
3.2 Future
The Earnings Per Share is expected to grow by 11.66% 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 Y8.14%
EPS Next 2Y11.42%
EPS Next 3Y11.66%
EPS Next 5YN/A
Revenue Next Year3.67%
Revenue Next 2Y4.28%
Revenue Next 3Y4.4%
Revenue Next 5YN/A
3.3 Evolution
The estimated forward EPS growth is still strong, although it is decreasing when compared to the stronger growth in the past 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
Based on the Price/Earnings ratio of 17.94, the valuation of ESI can be described as rather expensive.
Based on the Price/Earnings ratio, ESI is valued a bit cheaper than the industry average as 65.48% of the companies are valued more expensively.
When comparing the Price/Earnings ratio of ESI to the average of the S&P500 Index (28.02), we can say ESI is valued slightly cheaper.
The Price/Forward Earnings ratio is 14.90, which indicates a correct valuation of ESI.
65.48% of the companies in the same industry are more expensive than ESI, based on the Price/Forward Earnings ratio.
Compared to an average S&P500 Price/Forward Earnings ratio of 20.58, ESI is valued a bit cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 17.94 | ||
| Fwd PE | 14.9 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of ESI indicates a slightly more expensive valuation: ESI is more expensive than 63.10% of the companies listed in the same industry.
Based on the Price/Free Cash Flow ratio, ESI is valued a bit cheaper than the industry average as 63.10% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 20.78 | ||
| EV/EBITDA | 17.14 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
PEG (NY)2.2
PEG (5Y)0.92
EPS Next 2Y11.42%
EPS Next 3Y11.66%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 1.34%, ESI has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 3.14, ESI has a dividend in line with its industry peers.
With a Dividend Yield of 1.34, ESI pays less dividend than the S&P500 average, which is at 2.40.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.34% |
5.2 History
ESI has been paying a dividend for over 5 years, so it has already some track record.
ESI has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)N/A
Div Incr Years0
Div Non Decr Years3
5.3 Sustainability
59.45% of the earnings are spent on dividend by ESI. This is a bit on the high side, but may be sustainable.
DP59.45%
EPS Next 2Y11.42%
EPS Next 3Y11.66%
ELEMENT SOLUTIONS INC
NYSE:ESI (5/6/2024, 7:04:00 PM)
After market: 23.86 0 (0%)23.86
+0.04 (+0.17%)
Chartmill FA Rating
GICS SectorMaterials
GICS IndustryGroupMaterials
GICS IndustryChemicals
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap5.78B
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.34% |
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
Avg EPS beat(2)
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Revenue beat(2)
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PT rev (1m)
PT rev (3m)
EPS NQ rev (1m)
EPS NQ rev (3m)
EPS NY rev (1m)
EPS NY rev (3m)
Revenue NQ rev (1m)
Revenue NQ rev (3m)
Revenue NY rev (1m)
Revenue NY rev (3m)
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 17.94 | ||
| Fwd PE | 14.9 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)2.2
PEG (5Y)0.92
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.67% | ||
| ROE | 5.65% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 11.35% | ||
| PM (TTM) | 5.62% | ||
| GM | 40.09% | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover0.48
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.83 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 3.63 | ||
| Quick Ratio | 2.69 | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
Growth
EPS 1Y (TTM)0%
EPS 3Y10.35%
EPS 5Y
EPS growth Q2Q
EPS Next Y8.14%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)-4.49%
Revenue growth 3Y7.97%
Revenue growth 5Y
Revenue growth Q2Q
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y