Taking everything into account, KE scores 5 out of 10 in our fundamental rating. KE was compared to 123 industry peers in the Electronic Equipment, Instruments & Components industry. While KE has a great health rating, its profitability is only average at the moment. KE has a decent growth rate and is not valued too expensively.

Quickly go to:

1. Profitability

2. Health

3. Growth

4. Valuation

5. Dividend

1. Profitability

1.1 Basic Checks

KE had positive earnings in the past year.
KE had a positive operating cash flow in the past year.
KE had positive earnings in each of the past 5 years.
In multiple years KE reported negative operating cash flow during the last 5 years.

1.2 Ratios

KE has a Return On Assets (2.22%) which is comparable to the rest of the industry.
The Return On Equity of KE (4.14%) is comparable to the rest of the industry.
Looking at the Return On Invested Capital, with a value of 6.03%, KE is in the better half of the industry, outperforming 62.60% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for KE is in line with the industry average of 8.87%.

		Industry Rank	Sector Rank
ROA	2.22%
ROE	4.14%
ROIC	6.03%

ROA(3y)2.56%

ROA(5y)3.53%

ROE(3y)5.8%

ROE(5y)7.42%

ROIC(3y)7.03%

ROIC(5y)7.46%

1.3 Margins

KE's Profit Margin of 1.62% is in line compared to the rest of the industry. KE outperforms 53.66% of its industry peers.
In the last couple of years the Profit Margin of KE has declined.
KE's Operating Margin of 4.04% is fine compared to the rest of the industry. KE outperforms 60.16% of its industry peers.
KE's Operating Margin has improved in the last couple of years.
Looking at the Gross Margin, with a value of 7.42%, KE is doing worse than 83.74% of the companies in the same industry.
In the last couple of years the Gross Margin of KE has remained more or less at the same level.

		Industry Rank	Sector Rank
OM	4.04%
PM (TTM)	1.62%
GM	7.42%

OM growth 3Y-1.3%

OM growth 5Y1.84%

PM growth 3Y-20.97%

PM growth 5Y-5.52%

GM growth 3Y-3.24%

GM growth 5Y0.12%

More info and screens

ROA

ROE

ROIC

Operating and Profit Margin

Show most profitable peers

2. Health

2.1 Basic Checks

KE has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
Compared to 1 year ago, KE has less shares outstanding
Compared to 5 years ago, KE has less shares outstanding
The debt/assets ratio for KE has been reduced compared to a year ago.

2.2 Solvency

KE has an Altman-Z score of 3.29. This indicates that KE is financially healthy and has little risk of bankruptcy at the moment.
The Altman-Z score of KE (3.29) is comparable to the rest of the industry.
The Debt to FCF ratio of KE is 1.19, which is an excellent value as it means it would take KE, only 1.19 years of fcf income to pay off all of its debts.
KE's Debt to FCF ratio of 1.19 is amongst the best of the industry. KE outperforms 81.30% of its industry peers.
A Debt/Equity ratio of 0.23 indicates that KE is not too dependend on debt financing.
Looking at the Debt to Equity ratio, with a value of 0.23, KE is in line with its industry, outperforming 43.90% of the companies in the same industry.

		Industry Rank	Sector Rank
Debt/Equity	0.23
Debt/FCF	1.19
Altman-Z	3.29

ROIC/WACC0.73

WACC8.29%

2.3 Liquidity

KE has a Current Ratio of 2.21. This indicates that KE is financially healthy and has no problem in meeting its short term obligations.
KE has a Current ratio (2.21) which is in line with its industry peers.
A Quick Ratio of 1.34 indicates that KE should not have too much problems paying its short term obligations.
The Quick ratio of KE (1.34) is worse than 60.16% of its industry peers.

		Industry Rank	Sector Rank
Current Ratio	2.21
Quick Ratio	1.34

More info and screens

WACC

Debt/Equity

How to determine the health of a company

Altman-Z score

Show peers with great health

3. Growth

3.1 Past

The Earnings Per Share has grown by an nice 13.93% over the past year.
KE shows a decrease in Earnings Per Share. Measured over the last years, the EPS has been decreasing by -1.15% yearly.
Looking at the last year, KE shows a very negative growth in Revenue. The Revenue has decreased by -29.24% in the last year.
The Revenue has been growing slightly by 4.37% on average over the past years.

EPS 1Y (TTM)13.93%

EPS 3Y-2.27%

EPS 5Y-1.15%

EPS Q2Q%122.73%

Revenue 1Y (TTM)-29.24%

Revenue growth 3Y3.28%

Revenue growth 5Y4.37%

Sales Q2Q%-2.31%

3.2 Future

Based on estimates for the next years, KE will show a quite strong growth in Earnings Per Share. The EPS will grow by 15.74% on average per year.
Based on estimates for the next years, KE will show a small growth in Revenue. The Revenue will grow by 1.04% on average per year.

EPS Next Y18.2%

EPS Next 2Y15.74%

EPS Next 3YN/A

EPS Next 5YN/A

Revenue Next Year-2.49%

Revenue Next 2Y1.04%

Revenue Next 3YN/A

Revenue Next 5YN/A

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 accelerating.
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.

More info and screens

Find the best growth stocks

Show best growing peers

4. Valuation

4.1 Price/Earnings Ratio

Based on the Price/Earnings ratio of 21.31, the valuation of KE can be described as rather expensive.
KE's Price/Earnings ratio is a bit cheaper when compared to the industry. KE is cheaper than 79.67% of the companies in the same industry.
When comparing the Price/Earnings ratio of KE to the average of the S&P500 Index (27.21), we can say KE is valued slightly cheaper.
Based on the Price/Forward Earnings ratio of 19.74, the valuation of KE can be described as rather expensive.
Based on the Price/Forward Earnings ratio, KE is valued a bit cheaper than the industry average as 73.98% of the companies are valued more expensively.
The average S&P500 Price/Forward Earnings ratio is at 25.98. KE is valued slightly cheaper when compared to this.

		Industry Rank	Sector Rank
PE	21.31
Fwd PE	19.74

4.2 Price Multiples

Based on the Enterprise Value to EBITDA ratio, KE is valued cheaply inside the industry as 93.50% of the companies are valued more expensively.
Based on the Price/Free Cash Flow ratio, KE is valued cheaply inside the industry as 95.12% of the companies are valued more expensively.

		Industry Rank	Sector Rank
P/FCF	6.23
EV/EBITDA	8.1

4.3 Compensation for Growth

KE's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
KE's earnings are expected to grow with 15.74% in the coming years. This may justify a more expensive valuation.