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EHL

Emeco HoldingsASX:EHL Stock Report

Market Cap

AU$617.0m

7D

1.8%

1Y

50.3%

Updated

20 Oct, 2021

Data

Company Financials +
EHL fundamental analysis
Snowflake Score
Valuation4/6
Future Growth4/6
Past Performance1/6
Financial Health3/6
Dividends0/6

EHL Overview

Emeco Holdings Limited provides heavy earthmoving equipment and mining service solutions in Australia.

Emeco Holdings Competitors

Price History & Performance

Summary of all time highs, changes and price drops for Emeco Holdings
Historical stock prices
Current Share PriceAU$1.15
52 Week HighAU$0.73
52 Week LowAU$1.37
Beta2.03
1 Month Change11.65%
3 Month Change-10.85%
1 Year Change50.33%
3 Year Change-60.35%
5 Year Change66.67%
Change since IPO-93.59%

Recent News & Updates

Oct 12
These 4 Measures Indicate That Emeco Holdings (ASX:EHL) Is Using Debt Extensively

These 4 Measures Indicate That Emeco Holdings (ASX:EHL) Is Using Debt Extensively

Howard Marks put it nicely when he said that, rather than worrying about share price volatility, 'The possibility of...

Jun 29
These 4 Measures Indicate That Emeco Holdings (ASX:EHL) Is Using Debt Extensively

These 4 Measures Indicate That Emeco Holdings (ASX:EHL) Is Using Debt Extensively

Legendary fund manager Li Lu (who Charlie Munger backed) once said, 'The biggest investment risk is not the volatility...

Shareholder Returns

EHLAU Trade DistributorsAU Market
7D1.8%2.0%1.7%
1Y50.3%15.9%20.2%

Return vs Industry: EHL exceeded the Australian Trade Distributors industry which returned 15.9% over the past year.

Return vs Market: EHL exceeded the Australian Market which returned 20.2% over the past year.

Price Volatility

Is EHL's price volatile compared to industry and market?
EHL volatility
EHL Beta2.03
Industry Beta0.83
Market Beta1

Stable Share Price: EHL is not significantly more volatile than the rest of Australian stocks over the past 3 months, typically moving +/- 6% a week.

Volatility Over Time: EHL's weekly volatility (6%) has been stable over the past year.

About the Company

FoundedEmployeesCEOWebsite
19721,100Ian Testrowhttps://www.emecogroup.com

Emeco Holdings Limited provides heavy earthmoving equipment and mining service solutions in Australia. The company rents trucks, excavators, dozers, loaders, and graders. It is also involved in the maintenance and remanufacturing of various components of heavy earthmoving equipment.

Emeco Holdings Fundamentals Summary

How do Emeco Holdings's earnings and revenue compare to its market cap?
EHL fundamental statistics
Market CapAU$616.99m
Earnings (TTM)AU$20.70m
Revenue (TTM)AU$620.53m

29.8x

P/E Ratio

1.0x

P/S Ratio

Earnings & Revenue

Key profitability statistics from the latest earnings report
EHL income statement (TTM)
RevenueAU$620.53m
Cost of RevenueAU$236.43m
Gross ProfitAU$384.10m
ExpensesAU$363.40m
EarningsAU$20.70m

Last Reported Earnings

Jun 30, 2021

Next Earnings Date

n/a

Earnings per share (EPS)0.039
Gross Margin61.90%
Net Profit Margin3.34%
Debt/Equity Ratio49.5%

How did EHL perform over the long term?

See historical performance and comparison

Dividends

1.1%

Current Dividend Yield

31%

Payout Ratio

Valuation

Is Emeco Holdings undervalued compared to its fair value and its price relative to the market?

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: EHL (A$1.15) is trading below our estimate of fair value (A$2.67)

Significantly Below Fair Value: EHL is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: EHL is poor value based on its PE Ratio (29.8x) compared to the Australian Trade Distributors industry average (28.7x).

PE vs Market: EHL is poor value based on its PE Ratio (29.8x) compared to the Australian market (19.7x).


Price to Earnings Growth Ratio

PEG Ratio: EHL is good value based on its PEG Ratio (0.9x)


Price to Book Ratio

PB vs Industry: EHL is good value based on its PB Ratio (1.2x) compared to the AU Trade Distributors industry average (1.6x).


Future Growth

How is Emeco Holdings forecast to perform in the next 1 to 3 years based on estimates from 7 analysts?

33.6%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: EHL's forecast earnings growth (33.6% per year) is above the savings rate (1.9%).

Earnings vs Market: EHL's earnings (33.6% per year) are forecast to grow faster than the Australian market (11.9% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: EHL's revenue (6.8% per year) is forecast to grow faster than the Australian market (5.4% per year).

High Growth Revenue: EHL's revenue (6.8% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: EHL's Return on Equity is forecast to be low in 3 years time (13.7%).


Past Performance

How has Emeco Holdings performed over the past 5 years?

67.9%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: EHL has a large one-off loss of A$32.5M impacting its June 30 2021 financial results.

Growing Profit Margin: EHL's current net profit margins (3.3%) are lower than last year (12.2%).


Past Earnings Growth Analysis

Earnings Trend: EHL has become profitable over the past 5 years, growing earnings by 67.9% per year.

Accelerating Growth: EHL's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: EHL had negative earnings growth (-68.7%) over the past year, making it difficult to compare to the Trade Distributors industry average (28.1%).


Return on Equity

High ROE: EHL's Return on Equity (3.9%) is considered low.


Financial Health

How is Emeco Holdings's financial position?


Financial Position Analysis

Short Term Liabilities: EHL's short term assets (A$228.6M) exceed its short term liabilities (A$147.7M).

Long Term Liabilities: EHL's short term assets (A$228.6M) do not cover its long term liabilities (A$286.5M).


Debt to Equity History and Analysis

Debt Level: EHL's debt to equity ratio (49.5%) is considered high.

Reducing Debt: EHL's debt to equity ratio has reduced from 6513.1% to 49.5% over the past 5 years.

Debt Coverage: EHL's debt is well covered by operating cash flow (78.1%).

Interest Coverage: EHL's interest payments on its debt are not well covered by EBIT (3x coverage).


Balance Sheet


Dividend

What is Emeco Holdings's current dividend yield, its reliability and sustainability?

1.09%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: EHL's dividend (1.09%) isn’t notable compared to the bottom 25% of dividend payers in the Australian market (2.27%).

High Dividend: EHL's dividend (1.09%) is low compared to the top 25% of dividend payers in the Australian market (5.33%).


Stability and Growth of Payments

Stable Dividend: EHL is not paying a notable dividend for the Australian market, therefore no need to check if payments are stable.

Growing Dividend: EHL is not paying a notable dividend for the Australian market, therefore no need to check if payments are increasing.


Current Payout to Shareholders

Dividend Coverage: EHL is not paying a notable dividend for the Australian market.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of EHL's dividend in 3 years as they are not forecast to pay a notable one for the Australian market.


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

2.9yrs

Average management tenure


CEO

Ian Testrow (51 yo)

6.17yrs

Tenure

AU$9,957,943

Compensation

Mr. Ian M. Testrow, BEng (Civil), MBA has been the Chief Executive Officer, Managing Director and Executive Director at Emeco Holdings Limited since August 20, 2015 and served as its Chief Operating Office...


CEO Compensation Analysis

Compensation vs Market: Ian's total compensation ($USD7.45M) is above average for companies of similar size in the Australian market ($USD735.69K).

Compensation vs Earnings: Ian's compensation has been consistent with company performance over the past year.


Leadership Team

Experienced Management: EHL's management team is considered experienced (2.9 years average tenure).


Board Members

Experienced Board: EHL's board of directors are considered experienced (4.5 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Emeco Holdings Limited's employee growth, exchange listings and data sources


Key Information

  • Name: Emeco Holdings Limited
  • Ticker: EHL
  • Exchange: ASX
  • Founded: 1972
  • Industry: Trading Companies and Distributors
  • Sector: Capital Goods
  • Market Cap: AU$616.987m
  • Shares outstanding: 536.51m
  • Website: https://www.emecogroup.com

Number of Employees


Location

  • Emeco Holdings Limited
  • 71 Walters Drive
  • Level 3
  • Perth
  • Western Australia
  • 6017
  • Australia

Listings


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2021/10/20 15:25
End of Day Share Price2021/10/20 00:00
Earnings2021/06/30
Annual Earnings2021/06/30


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.