PHILLIPS EDISON & COMPANY IN (PECO) Stock Fundamental Analysis
USA - NASDAQ:PECO - US71844V2016 - REIT
33.75 USD
+0.08 (+0.24%)
33.75 USD
0 (0%)
PECO gets a fundamental rating of 4 out of 10. The analysis compared the fundamentals against 129 industry peers in the Diversified REITs industry. There are concerns on the financial health of PECO while its profitability can be described as average. PECO is valied quite expensively at the moment, while it does show a decent growth rate.
1. Profitability
1.1 Basic Checks
PECO had positive earnings in the past year.
In the past year PECO had a positive cash flow from operations.
Each year in the past 5 years PECO has been profitable.
In the past 5 years PECO always reported a positive cash flow from operatings.
1.2 Ratios
Looking at the Return On Assets, with a value of 1.31%, PECO is in line with its industry, outperforming 56.59% of the companies in the same industry.
The Return On Equity of PECO (3.01%) is comparable to the rest of the industry.
With a Return On Invested Capital value of 2.76%, PECO perfoms like the industry average, outperforming 51.16% of the companies in the same industry.
PECO had an Average Return On Invested Capital over the past 3 years of 2.51%. This is in line with the industry average of 3.01%.
The 3 year average ROIC (2.51%) for PECO is below the current ROIC(2.76%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.31% | ||
| ROE | 3.01% | ||
| ROIC | 2.76% |
ROA(3y)1.14%
ROA(5y)0.77%
ROE(3y)2.44%
ROE(5y)1.66%
ROIC(3y)2.51%
ROIC(5y)2.07%
1.3 Margins
With a Profit Margin value of 9.91%, PECO perfoms like the industry average, outperforming 55.81% of the companies in the same industry.
In the last couple of years the Profit Margin of PECO has grown nicely.
PECO has a Operating Margin (25.85%) which is in line with its industry peers.
PECO's Operating Margin has improved in the last couple of years.
Looking at the Gross Margin, with a value of 71.26%, PECO is in the better half of the industry, outperforming 65.12% of the companies in the same industry.
PECO's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 25.85% | ||
| PM (TTM) | 9.91% | ||
| GM | 71.26% |
OM growth 3Y23.39%
OM growth 5Y7%
PM growth 3Y49.54%
PM growth 5YN/A
GM growth 3Y0.43%
GM growth 5Y0.35%
2. Health
2.1 Basic Checks
PECO has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
PECO has more shares outstanding than it did 1 year ago.
PECO has more shares outstanding than it did 5 years ago.
The debt/assets ratio for PECO is higher compared to a year ago.
2.2 Solvency
PECO has an Altman-Z score of 0.71. This is a bad value and indicates that PECO is not financially healthy and even has some risk of bankruptcy.
With a decent Altman-Z score value of 0.71, PECO is doing good in the industry, outperforming 64.34% of the companies in the same industry.
The Debt to FCF ratio of PECO is 10.58, which is on the high side as it means it would take PECO, 10.58 years of fcf income to pay off all of its debts.
PECO has a better Debt to FCF ratio (10.58) than 88.37% of its industry peers.
A Debt/Equity ratio of 1.04 is on the high side and indicates that PECO has dependencies on debt financing.
PECO's Debt to Equity ratio of 1.04 is in line compared to the rest of the industry. PECO outperforms 59.69% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.04 | ||
| Debt/FCF | 10.58 | ||
| Altman-Z | 0.71 |
ROIC/WACC0.4
WACC6.87%
2.3 Liquidity
PECO has a Current Ratio of 0.15. This is a bad value and indicates that PECO is not financially healthy enough and could expect problems in meeting its short term obligations.
Looking at the Current ratio, with a value of 0.15, PECO is doing worse than 93.80% of the companies in the same industry.
A Quick Ratio of 0.15 indicates that PECO may have some problems paying its short term obligations.
PECO's Quick ratio of 0.15 is on the low side compared to the rest of the industry. PECO is outperformed by 93.80% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.15 | ||
| Quick Ratio | 0.15 |
3. Growth
3.1 Past
PECO shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 12.24%, which is quite good.
PECO shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 55.36% yearly.
PECO shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 10.30%.
The Revenue has been growing slightly by 4.27% on average over the past years.
EPS 1Y (TTM)12.24%
EPS 3Y55.36%
EPS 5YN/A
EPS Q2Q%-16.67%
Revenue 1Y (TTM)10.3%
Revenue growth 3Y7.47%
Revenue growth 5Y4.27%
Sales Q2Q%10.05%
3.2 Future
PECO is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 18.55% yearly.
The Revenue is expected to grow by 6.84% on average over the next years.
EPS Next Y25.26%
EPS Next 2Y19.07%
EPS Next 3Y18.55%
EPS Next 5YN/A
Revenue Next Year10.24%
Revenue Next 2Y7.79%
Revenue Next 3Y6.84%
Revenue Next 5YN/A
3.3 Evolution
Although the future EPS growth is still strong, it is not able to hold up the even more excellent growth rate of the past 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 accelerating.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 61.36, PECO can be considered very expensive at the moment.
PECO's Price/Earnings ratio is in line with the industry average.
PECO's Price/Earnings ratio indicates a rather expensive valuation when compared to the S&P500 average which is at 27.86.
PECO is valuated quite expensively with a Price/Forward Earnings ratio of 47.61.
PECO's Price/Forward Earnings ratio is in line with the industry average.
When comparing the Price/Forward Earnings ratio of PECO to the average of the S&P500 Index (23.32), we can say PECO is valued expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 61.36 | ||
| Fwd PE | 47.61 |
4.2 Price Multiples
The rest of the industry has a similar Enterprise Value to EBITDA ratio as PECO.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of PECO indicates a somewhat cheap valuation: PECO is cheaper than 78.29% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 18.74 | ||
| EV/EBITDA | 14.8 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
The decent profitability rating of PECO may justify a higher PE ratio.
A more expensive valuation may be justified as PECO's earnings are expected to grow with 18.55% in the coming years.
PEG (NY)2.43
PEG (5Y)N/A
EPS Next 2Y19.07%
EPS Next 3Y18.55%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 3.86%, PECO has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 6.68, PECO is paying slightly less dividend.
Compared to an average S&P500 Dividend Yield of 2.44, PECO pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.86% |
5.2 History
The dividend of PECO decreases each year by -3.54%.
PECO has been paying a dividend for over 5 years, so it has already some track record.
PECO has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)-3.54%
Div Incr Years3
Div Non Decr Years3
5.3 Sustainability
238.70% of the earnings are spent on dividend by PECO. This is not a sustainable payout ratio.
DP238.7%
EPS Next 2Y19.07%
EPS Next 3Y18.55%
33.75
+0.08 (+0.24%)
Chartmill FA Rating
GICS SectorReal Estate
GICS IndustryGroupEquity Real Estate Investment Trusts (REITs)
GICS IndustryDiversified REITs
Earnings (Last)
Earnings (Next)
Inst Owners89.11%
Inst Owner Change0%
Ins Owners0.53%
Ins Owner Change3.86%
Market Cap4.24B
Analysts77.78
Price Target40.09 (18.79%)
Short Float %2.78%
Short Ratio3.75
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.86% |
Yearly Dividend1.08
Dividend Growth(5Y)-3.54%
DP238.7%
Div Incr Years3
Div Non Decr Years3
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)7.41%
Min EPS beat(2)-25.54%
Max EPS beat(2)40.37%
EPS beat(4)2
Avg EPS beat(4)-0.13%
Min EPS beat(4)-36.21%
Max EPS beat(4)40.37%
EPS beat(8)5
Avg EPS beat(8)0.46%
EPS beat(12)9
Avg EPS beat(12)7.88%
EPS beat(16)12
Avg EPS beat(16)-42.9%
Revenue beat(2)2
Avg Revenue beat(2)1.45%
Min Revenue beat(2)0.29%
Max Revenue beat(2)2.6%
Revenue beat(4)3
Avg Revenue beat(4)0.86%
Min Revenue beat(4)-0.4%
Max Revenue beat(4)2.6%
Revenue beat(8)4
Avg Revenue beat(8)-0.1%
Revenue beat(12)8
Avg Revenue beat(12)0.64%
Revenue beat(16)12
Avg Revenue beat(16)1.75%
PT rev (1m)0.26%
PT rev (3m)-0.92%
EPS NQ rev (1m)-1.35%
EPS NQ rev (3m)9.5%
EPS NY rev (1m)0.24%
EPS NY rev (3m)2.33%
Revenue NQ rev (1m)0.01%
Revenue NQ rev (3m)0.31%
Revenue NY rev (1m)0.78%
Revenue NY rev (3m)0.57%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 61.36 | ||
| Fwd PE | 47.61 | ||
| P/S | 6.1 | ||
| P/FCF | 18.74 | ||
| P/OCF | 12.12 | ||
| P/B | 1.85 | ||
| P/tB | 1.88 | ||
| EV/EBITDA | 14.8 |
EPS(TTM)0.55
EY1.63%
EPS(NY)0.71
Fwd EY2.1%
FCF(TTM)1.8
FCFY5.34%
OCF(TTM)2.78
OCFY8.25%
SpS5.53
BVpS18.23
TBVpS17.95
PEG (NY)2.43
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.31% | ||
| ROE | 3.01% | ||
| ROCE | 3.5% | ||
| ROIC | 2.76% | ||
| ROICexc | 2.77% | ||
| ROICexgc | 2.81% | ||
| OM | 25.85% | ||
| PM (TTM) | 9.91% | ||
| GM | 71.26% | ||
| FCFM | 32.57% |
ROA(3y)1.14%
ROA(5y)0.77%
ROE(3y)2.44%
ROE(5y)1.66%
ROIC(3y)2.51%
ROIC(5y)2.07%
ROICexc(3y)2.52%
ROICexc(5y)2.08%
ROICexgc(3y)2.56%
ROICexgc(5y)2.12%
ROCE(3y)3.18%
ROCE(5y)2.62%
ROICexcg growth 3Y28.89%
ROICexcg growth 5Y10.24%
ROICexc growth 3Y28.89%
ROICexc growth 5Y10.67%
OM growth 3Y23.39%
OM growth 5Y7%
PM growth 3Y49.54%
PM growth 5YN/A
GM growth 3Y0.43%
GM growth 5Y0.35%
F-Score6
Asset Turnover0.13
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.04 | ||
| Debt/FCF | 10.58 | ||
| Debt/EBITDA | 5.35 | ||
| Cap/Depr | 46.09% | ||
| Cap/Sales | 17.79% | ||
| Interest Coverage | 2.17 | ||
| Cash Conversion | 78.14% | ||
| Profit Quality | 328.62% | ||
| Current Ratio | 0.15 | ||
| Quick Ratio | 0.15 | ||
| Altman-Z | 0.71 |
F-Score6
WACC6.87%
ROIC/WACC0.4
Cap/Depr(3y)40.7%
Cap/Depr(5y)36.89%
Cap/Sales(3y)16.05%
Cap/Sales(5y)15.02%
Profit Quality(3y)370.81%
Profit Quality(5y)1082.19%
High Growth Momentum
Growth
EPS 1Y (TTM)12.24%
EPS 3Y55.36%
EPS 5YN/A
EPS Q2Q%-16.67%
EPS Next Y25.26%
EPS Next 2Y19.07%
EPS Next 3Y18.55%
EPS Next 5YN/A
Revenue 1Y (TTM)10.3%
Revenue growth 3Y7.47%
Revenue growth 5Y4.27%
Sales Q2Q%10.05%
Revenue Next Year10.24%
Revenue Next 2Y7.79%
Revenue Next 3Y6.84%
Revenue Next 5YN/A
EBIT growth 1Y8.97%
EBIT growth 3Y32.61%
EBIT growth 5Y11.56%
EBIT Next Year173.11%
EBIT Next 3Y45.4%
EBIT Next 5YN/A
FCF growth 1Y33.38%
FCF growth 3Y8.44%
FCF growth 5Y12.26%
OCF growth 1Y25.46%
OCF growth 3Y8.38%
OCF growth 5Y8.09%