ESSEX PROPERTY TRUST INC (ESS) Stock Fundamental Analysis
USA - NYSE:ESS - US2971781057 - REIT
259.37 USD
+1.79 (+0.69%)
259.37 USD
0 (0%)
We assign a fundamental rating of 4 out of 10 to ESS. ESS was compared to 20 industry peers in the Residential REITs industry. While ESS has a great profitability rating, there are quite some concerns on its financial health. ESS is quite expensive at the moment. It does show a decent growth rate.
1. Profitability
1.1 Basic Checks
In the past year ESS was profitable.
ESS had a positive operating cash flow in the past year.
ESS had positive earnings in each of the past 5 years.
ESS had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
Looking at the Return On Assets, with a value of 6.07%, ESS belongs to the top of the industry, outperforming 90.00% of the companies in the same industry.
The Return On Equity of ESS (14.20%) is better than 90.00% of its industry peers.
The Return On Invested Capital of ESS (3.46%) is better than 85.00% of its industry peers.
The Average Return On Invested Capital over the past 3 years for ESS is in line with the industry average of 2.59%.
The 3 year average ROIC (3.38%) for ESS is below the current ROIC(3.46%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.07% | ||
| ROE | 14.2% | ||
| ROIC | 3.46% |
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
Looking at the Profit Margin, with a value of 43.51%, ESS belongs to the top of the industry, outperforming 95.00% of the companies in the same industry.
ESS's Profit Margin has improved in the last couple of years.
ESS's Operating Margin of 30.29% is amongst the best of the industry. ESS outperforms 90.00% of its industry peers.
In the last couple of years the Operating Margin of ESS has declined.
Looking at the Gross Margin, with a value of 70.55%, ESS belongs to the top of the industry, outperforming 100.00% 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 | 30.29% | ||
| PM (TTM) | 43.51% | ||
| GM | 70.55% |
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
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so ESS is destroying value.
Compared to 1 year ago, ESS has about the same amount of shares outstanding.
The number of shares outstanding for ESS has been reduced compared to 5 years ago.
ESS has a worse debt/assets ratio than last year.
2.2 Solvency
ESS has an Altman-Z score of 1.47. This is a bad value and indicates that ESS is not financially healthy and even has some risk of bankruptcy.
With a decent Altman-Z score value of 1.47, ESS is doing good in the industry, outperforming 70.00% of the companies in the same industry.
ESS has a Debt/Equity ratio of 1.20. This is a high value indicating a heavy dependency on external financing.
ESS has a Debt to Equity ratio (1.20) which is in line with its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.2 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 1.47 |
ROIC/WACC0.49
WACC7.05%
2.3 Liquidity
ESS has a Current Ratio of 0.71. 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 Current ratio of 0.71 is fine compared to the rest of the industry. ESS outperforms 65.00% of its industry peers.
ESS has a Quick Ratio of 0.71. 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 0.36 is in line compared to the rest of the industry. ESS outperforms 55.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.71 | ||
| Quick Ratio | 0.36 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 20.17% over the past year.
The Earnings Per Share has been growing slightly by 5.66% on average over the past years.
Looking at the last year, ESS shows a small growth in Revenue. The Revenue has grown by 7.56% in the last year.
Measured over the past years, ESS shows a small growth in Revenue. The Revenue has been growing by 3.98% on average per year.
EPS 1Y (TTM)20.17%
EPS 3Y5.47%
EPS 5Y5.66%
EPS Q2Q%137.24%
Revenue 1Y (TTM)7.56%
Revenue growth 3Y7.2%
Revenue growth 5Y3.98%
Sales Q2Q%5.71%
3.2 Future
ESS is expected to show a decrease in Earnings Per Share. In the coming years, the EPS will decrease by -4.22% yearly.
Based on estimates for the next years, ESS will show a small growth in Revenue. The Revenue will grow by 3.98% on average per year.
EPS Next Y9.51%
EPS Next 2Y-17.61%
EPS Next 3Y-9.74%
EPS Next 5Y-4.22%
Revenue Next Year6.58%
Revenue Next 2Y5.18%
Revenue Next 3Y4.74%
Revenue Next 5Y3.98%
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less 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 stable.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 26.71, which means the current valuation is very expensive for ESS.
Based on the Price/Earnings ratio, ESS is valued cheaply inside the industry as 85.00% of the companies are valued more expensively.
The average S&P500 Price/Earnings ratio is at 27.50. ESS is around the same levels.
ESS is valuated quite expensively with a Price/Forward Earnings ratio of 43.37.
70.00% of the companies in the same industry are more expensive than ESS, based on the Price/Forward Earnings ratio.
Compared to an average S&P500 Price/Forward Earnings ratio of 22.99, ESS is valued quite expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 26.71 | ||
| Fwd PE | 43.37 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of ESS indicates a slightly more expensive valuation: ESS is more expensive than 75.00% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 20.16 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
ESS has an outstanding profitability rating, which may justify a higher PE ratio.
ESS's earnings are expected to decrease with -9.74% in the coming years. This may justify a cheaper valuation.
PEG (NY)2.81
PEG (5Y)4.72
EPS Next 2Y-17.61%
EPS Next 3Y-9.74%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 3.97%, ESS has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 6.43, ESS is paying slightly less dividend.
ESS's Dividend Yield is rather good when compared to the S&P500 average which is at 2.44.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.97% |
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 decreased its dividend recently.
Dividend Growth(5Y)4.65%
Div Incr Years1
Div Non Decr Years1
5.3 Sustainability
ESS pays out 79.64% of its income as dividend. This is not a sustainable payout ratio.
ESS's earnings are declining while the Dividend Rate has been growing. This means the dividend growth is most likely not sustainable.
DP79.64%
EPS Next 2Y-17.61%
EPS Next 3Y-9.74%
259.37
+1.79 (+0.69%)
Chartmill FA Rating
GICS SectorReal Estate
GICS IndustryGroupEquity Real Estate Investment Trusts (REITs)
GICS IndustryResidential REITs
Earnings (Last)
Earnings (Next)
Inst Owners103.51%
Inst Owner Change-0.04%
Ins Owners1.14%
Ins Owner Change4.31%
Market Cap16.70B
Analysts66.45
Price Target300 (15.66%)
Short Float %1.96%
Short Ratio2.49
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.97% |
Yearly Dividend9.66
Dividend Growth(5Y)4.65%
DP79.64%
Div Incr Years1
Div Non Decr Years1
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)126.56%
Min EPS beat(2)123.13%
Max EPS beat(2)129.99%
EPS beat(4)3
Avg EPS beat(4)69.24%
Min EPS beat(4)-9.12%
Max EPS beat(4)129.99%
EPS beat(8)5
Avg EPS beat(8)59.09%
EPS beat(12)9
Avg EPS beat(12)55.58%
EPS beat(16)11
Avg EPS beat(16)49.74%
Revenue beat(2)0
Avg Revenue beat(2)-0.79%
Min Revenue beat(2)-1.19%
Max Revenue beat(2)-0.4%
Revenue beat(4)0
Avg Revenue beat(4)-0.67%
Min Revenue beat(4)-1.19%
Max Revenue beat(4)-0.27%
Revenue beat(8)2
Avg Revenue beat(8)-0.32%
Revenue beat(12)3
Avg Revenue beat(12)-0.45%
Revenue beat(16)6
Avg Revenue beat(16)-0.14%
PT rev (1m)0%
PT rev (3m)-5.1%
EPS NQ rev (1m)0%
EPS NQ rev (3m)0.01%
EPS NY rev (1m)5.41%
EPS NY rev (3m)26.38%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-0.08%
Revenue NY rev (1m)0.11%
Revenue NY rev (3m)0.11%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 26.71 | ||
| Fwd PE | 43.37 | ||
| P/S | 9.08 | ||
| P/FCF | N/A | ||
| P/OCF | 16.19 | ||
| P/B | 2.96 | ||
| P/tB | 2.96 | ||
| EV/EBITDA | 20.16 |
EPS(TTM)9.71
EY3.74%
EPS(NY)5.98
Fwd EY2.31%
FCF(TTM)-3.69
FCFYN/A
OCF(TTM)16.02
OCFY6.18%
SpS28.56
BVpS87.5
TBVpS87.5
PEG (NY)2.81
PEG (5Y)4.72
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.07% | ||
| ROE | 14.2% | ||
| ROCE | 4.37% | ||
| ROIC | 3.46% | ||
| ROICexc | 3.47% | ||
| ROICexgc | 3.47% | ||
| OM | 30.29% | ||
| PM (TTM) | 43.51% | ||
| GM | 70.55% | ||
| 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-Score6
Asset Turnover0.14
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.2 | ||
| Debt/FCF | N/A | ||
| Debt/EBITDA | 5.85 | ||
| Cap/Depr | 212.3% | ||
| Cap/Sales | 69.02% | ||
| Interest Coverage | 2.34 | ||
| Cash Conversion | 89.32% | ||
| Profit Quality | N/A | ||
| Current Ratio | 0.71 | ||
| Quick Ratio | 0.36 | ||
| Altman-Z | 1.47 |
F-Score6
WACC7.05%
ROIC/WACC0.49
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)20.17%
EPS 3Y5.47%
EPS 5Y5.66%
EPS Q2Q%137.24%
EPS Next Y9.51%
EPS Next 2Y-17.61%
EPS Next 3Y-9.74%
EPS Next 5Y-4.22%
Revenue 1Y (TTM)7.56%
Revenue growth 3Y7.2%
Revenue growth 5Y3.98%
Sales Q2Q%5.71%
Revenue Next Year6.58%
Revenue Next 2Y5.18%
Revenue Next 3Y4.74%
Revenue Next 5Y3.98%
EBIT growth 1Y4.68%
EBIT growth 3Y10.86%
EBIT growth 5Y1.43%
EBIT Next Year134.72%
EBIT Next 3Y35.64%
EBIT Next 5Y27.24%
FCF growth 1Y-137.01%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y8.12%
OCF growth 3Y5.68%
OCF growth 5Y3.05%