ESSEX PROPERTY TRUST INC (ESS) Stock Fundamental Analysis
NYSE:ESS - New York Stock Exchange, Inc. - US2971781057 - REIT - Currency: USD
Taking everything into account, ESS scores 4 out of 10 in our fundamental rating. ESS was compared to 20 industry peers in the Residential REITs industry. While ESS belongs to the best of the industry regarding profitability, there are concerns on its financial health. ESS does not seem to be growing, but still is valued expensively.
1. Profitability
1.1 Basic Checks
ESS had positive earnings in the past year.
In the past year ESS had a positive cash flow from operations.
Each year in the past 5 years ESS has been profitable.
ESS had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
The Return On Assets of ESS (5.74%) is better than 95.00% of its industry peers.
ESS has a Return On Equity of 13.39%. This is amongst the best in the industry. ESS outperforms 95.00% of its industry peers.
ESS has a Return On Invested Capital of 3.34%. This is in the better half of the industry: ESS outperforms 80.00% of its industry peers.
ESS had an Average Return On Invested Capital over the past 3 years of 3.38%. This is in line with the industry average of 2.74%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.74% | ||
| ROE | 13.39% | ||
| ROIC | 3.34% |
ROA(3y)4.11%
ROA(5y)4.1%
ROE(3y)9.34%
ROE(5y)9.13%
ROIC(3y)3.38%
ROIC(5y)3.06%
1.3 Margins
ESS's Profit Margin of 41.79% is amongst the best of the industry. ESS outperforms 100.00% of its industry peers.
In the last couple of years the Profit Margin of ESS has grown nicely.
ESS's Operating Margin of 29.73% is amongst the best of the industry. ESS outperforms 90.00% of its industry peers.
ESS's Operating Margin has declined in the last couple of years.
Looking at the Gross Margin, with a value of 70.72%, ESS belongs to the top of the industry, outperforming 95.00% of the companies in the same industry.
In the last couple of years the Gross Margin of ESS has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 29.73% | ||
| PM (TTM) | 41.79% | ||
| GM | 70.72% |
OM growth 3Y3.42%
OM growth 5Y-2.45%
PM growth 3Y7.21%
PM growth 5Y6.79%
GM growth 3Y0.78%
GM growth 5Y-0.57%
2. Health
2.1 Basic Checks
ESS has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
ESS has about the same amout of shares outstanding than it did 1 year ago.
Compared to 5 years ago, ESS has less shares outstanding
ESS has a worse debt/assets ratio than last year.
2.2 Solvency
Based on the Altman-Z score of 1.60, we must say that ESS is in the distress zone and has some risk of bankruptcy.
With a decent Altman-Z score value of 1.60, ESS is doing good in the industry, outperforming 65.00% of the companies in the same industry.
ESS has a Debt/Equity ratio of 1.19. This is a high value indicating a heavy dependency on external financing.
The Debt to Equity ratio of ESS (1.19) is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.19 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 1.6 |
ROIC/WACC0.45
WACC7.38%
2.3 Liquidity
A Current Ratio of 0.52 indicates that ESS may have some problems paying its short term obligations.
Looking at the Current ratio, with a value of 0.52, ESS is in line with its industry, outperforming 60.00% of the companies in the same industry.
ESS has a Quick Ratio of 0.52. This is a bad value and indicates that ESS is not financially healthy enough and could expect problems in meeting its short term obligations.
ESS's Quick ratio of 0.41 is in line compared to the rest of the industry. ESS outperforms 55.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.52 | ||
| Quick Ratio | 0.41 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 4.28% over the past year.
The Earnings Per Share has been growing slightly by 5.66% on average over the past years.
The Revenue has been growing slightly by 6.29% in the past year.
The Revenue has been growing slightly by 3.98% on average over the past years.
EPS 1Y (TTM)4.28%
EPS 3Y5.47%
EPS 5Y5.66%
EPS Q2Q%-6.59%
Revenue 1Y (TTM)6.29%
Revenue growth 3Y7.2%
Revenue growth 5Y3.98%
Sales Q2Q%8.82%
3.2 Future
The Earnings Per Share is expected to decrease by -2.69% on average over the next years.
Based on estimates for the next years, ESS will show a small growth in Revenue. The Revenue will grow by 3.80% on average per year.
EPS Next Y-32.81%
EPS Next 2Y-16.16%
EPS Next 3Y-8.1%
EPS Next 5Y-2.69%
Revenue Next Year6.01%
Revenue Next 2Y5.02%
Revenue Next 3Y4.82%
Revenue Next 5Y3.8%
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 stable.
4. Valuation
4.1 Price/Earnings Ratio
ESS is valuated quite expensively with a Price/Earnings ratio of 33.14.
Based on the Price/Earnings ratio, ESS is valued a bit cheaper than the industry average as 75.00% of the companies are valued more expensively.
When comparing the Price/Earnings ratio of ESS to the average of the S&P500 Index (24.21), we can say ESS is valued slightly more expensively.
The Price/Forward Earnings ratio is 45.65, which means the current valuation is very expensive for ESS.
Based on the Price/Forward Earnings ratio, ESS is valued a bit cheaper than the industry average as 75.00% of the companies are valued more expensively.
The average S&P500 Price/Forward Earnings ratio is at 20.44. ESS is valued rather expensively when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 33.14 | ||
| Fwd PE | 45.65 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, ESS is valued more expensive than 80.00% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 22.25 |
4.3 Compensation for Growth
ESS has an outstanding profitability rating, which may justify a higher PE ratio.
ESS's earnings are expected to decrease with -8.10% in the coming years. This may justify a cheaper valuation.
PEG (NY)N/A
PEG (5Y)5.86
EPS Next 2Y-16.16%
EPS Next 3Y-8.1%
5. Dividend
5.1 Amount
ESS has a Yearly Dividend Yield of 3.65%. Purely for dividend investing, there may be better candidates out there.
ESS's Dividend Yield is comparable with the industry average which is at 4.52.
ESS's Dividend Yield is rather good when compared to the S&P500 average which is at 2.42.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.65% |
5.2 History
The dividend of ESS has a limited annual growth rate of 4.65%.
ESS has paid a dividend for at least 10 years, which is a reliable track record.
ESS has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)4.65%
Div Incr Years29
Div Non Decr Years29
5.3 Sustainability
ESS pays out 83.67% of its income as dividend. This is not a sustainable payout ratio.
The Dividend Rate of ESS has been growing, while earnings will be declining. This means the dividend growth is most likely not sustainable.
DP83.67%
EPS Next 2Y-16.16%
EPS Next 3Y-8.1%
282.69
+1.04 (+0.37%)
Chartmill FA Rating
GICS SectorReal Estate
GICS IndustryGroupEquity Real Estate Investment Trusts (REITs)
GICS IndustryResidential REITs
Earnings (Last)
Earnings (Next)
Inst Owners96.96%
Inst Owner Change2%
Ins Owners1.11%
Ins Owner Change2%
Market Cap18.19B
Analysts67.1
Price Target316.59 (11.99%)
Short Float %2.07%
Short Ratio2.68
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.65% |
Yearly Dividend9.66
Dividend Growth(5Y)4.65%
DP83.67%
Div Incr Years29
Div Non Decr Years29
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)11.93%
Min EPS beat(2)-9.12%
Max EPS beat(2)32.98%
EPS beat(4)3
Avg EPS beat(4)63.81%
Min EPS beat(4)-9.12%
Max EPS beat(4)225.19%
EPS beat(8)5
Avg EPS beat(8)39.2%
EPS beat(12)7
Avg EPS beat(12)30.92%
EPS beat(16)11
Avg EPS beat(16)45.41%
Revenue beat(2)0
Avg Revenue beat(2)-0.56%
Min Revenue beat(2)-0.85%
Max Revenue beat(2)-0.27%
Revenue beat(4)2
Avg Revenue beat(4)0.15%
Min Revenue beat(4)-0.85%
Max Revenue beat(4)1.43%
Revenue beat(8)2
Avg Revenue beat(8)-0.44%
Revenue beat(12)5
Avg Revenue beat(12)-0.12%
Revenue beat(16)6
Avg Revenue beat(16)-0.14%
PT rev (1m)-0.55%
PT rev (3m)0.96%
EPS NQ rev (1m)-3.44%
EPS NQ rev (3m)-3.12%
EPS NY rev (1m)-1.48%
EPS NY rev (3m)-2.58%
Revenue NQ rev (1m)0.29%
Revenue NQ rev (3m)0.88%
Revenue NY rev (1m)0.11%
Revenue NY rev (3m)0.96%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 33.14 | ||
| Fwd PE | 45.65 | ||
| P/S | 10.25 | ||
| P/FCF | N/A | ||
| P/OCF | 17.02 | ||
| P/B | 3.28 | ||
| P/tB | 3.28 | ||
| EV/EBITDA | 22.25 |
EPS(TTM)8.53
EY3.02%
EPS(NY)6.19
Fwd EY2.19%
FCF(TTM)-1.27
FCFYN/A
OCF(TTM)16.61
OCFY5.87%
SpS27.58
BVpS86.07
TBVpS86.07
PEG (NY)N/A
PEG (5Y)5.86
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.74% | ||
| ROE | 13.39% | ||
| ROCE | 4.23% | ||
| ROIC | 3.34% | ||
| ROICexc | 3.36% | ||
| ROICexgc | 3.36% | ||
| OM | 29.73% | ||
| PM (TTM) | 41.79% | ||
| GM | 70.72% | ||
| FCFM | N/A |
ROA(3y)4.11%
ROA(5y)4.1%
ROE(3y)9.34%
ROE(5y)9.13%
ROIC(3y)3.38%
ROIC(5y)3.06%
ROICexc(3y)3.43%
ROICexc(5y)3.09%
ROICexgc(3y)3.43%
ROICexgc(5y)3.09%
ROCE(3y)4.28%
ROCE(5y)3.87%
ROICexcg growth 3Y11.24%
ROICexcg growth 5Y1.13%
ROICexc growth 3Y11.22%
ROICexc growth 5Y1.11%
OM growth 3Y3.42%
OM growth 5Y-2.45%
PM growth 3Y7.21%
PM growth 5Y6.79%
GM growth 3Y0.78%
GM growth 5Y-0.57%
F-Score5
Asset Turnover0.14
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.19 | ||
| Debt/FCF | N/A | ||
| Debt/EBITDA | 5.96 | ||
| Cap/Depr | 198.25% | ||
| Cap/Sales | 64.82% | ||
| Interest Coverage | 2.36 | ||
| Cash Conversion | 96.43% | ||
| Profit Quality | N/A | ||
| Current Ratio | 0.52 | ||
| Quick Ratio | 0.41 | ||
| Altman-Z | 1.6 |
F-Score5
WACC7.38%
ROIC/WACC0.45
Cap/Depr(3y)100.16%
Cap/Depr(5y)101.9%
Cap/Sales(3y)32.94%
Cap/Sales(5y)34.6%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)4.28%
EPS 3Y5.47%
EPS 5Y5.66%
EPS Q2Q%-6.59%
EPS Next Y-32.81%
EPS Next 2Y-16.16%
EPS Next 3Y-8.1%
EPS Next 5Y-2.69%
Revenue 1Y (TTM)6.29%
Revenue growth 3Y7.2%
Revenue growth 5Y3.98%
Sales Q2Q%8.82%
Revenue Next Year6.01%
Revenue Next 2Y5.02%
Revenue Next 3Y4.82%
Revenue Next 5Y3.8%
EBIT growth 1Y0.28%
EBIT growth 3Y10.86%
EBIT growth 5Y1.43%
EBIT Next Year133.07%
EBIT Next 3Y35.97%
EBIT Next 5Y26.93%
FCF growth 1Y-111.17%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y9%
OCF growth 3Y5.68%
OCF growth 5Y3.05%