ASX:EOF

Stock Analysis Report

Executive Summary

Ecofibre Limited, together with its subsidiaries, engages in breeding, growing, processing, and distributing hemp products in the United States and Australia.

Rewards

Earnings are forecast to grow 54.71% per year

Became profitable this year

Risk Analysis

High level of non-cash earnings

Highly volatile share price over past 3 months



Snowflake Analysis

Exceptional growth potential with excellent balance sheet.

Share Price & News

How has Ecofibre's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: EOF's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

-17.7%

EOF

-6.4%

AU Pharmaceuticals

-1.8%

AU Market


1 Year Return

n/a

EOF

-27.7%

AU Pharmaceuticals

20.0%

AU Market

Return vs Industry: Insufficient data to determine how EOF performed against the Australian Pharmaceuticals industry.

Return vs Market: Insufficient data to determine how EOF performed against the Australian Market.


Shareholder returns

EOFIndustryMarket
7 Day-17.7%-6.4%-1.8%
30 Day-20.4%-13.9%-0.3%
90 Day-14.3%-17.3%1.1%
1 Yearn/a-27.5%-27.7%25.9%20.0%
3 Yearn/a-40.4%-40.9%36.0%17.4%
5 Yearn/a-17.4%-24.7%62.5%25.9%

Price Volatility Vs. Market

How volatile is Ecofibre's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

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

118.22x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: Insufficient data to calculate EOF's fair value to establish if it is undervalued.

Significantly Below Fair Value: Insufficient data to calculate EOF's fair value to establish if it is undervalued.


Price To Earnings Ratio

PE vs Industry: EOF is poor value based on its PE Ratio (118.2x) compared to the Pharmaceuticals industry average (29.1x).

PE vs Market: EOF is poor value based on its PE Ratio (118.2x) compared to the Australian market (18.4x).


Price to Earnings Growth Ratio

PEG Ratio: EOF is poor value based on its PEG Ratio (2.2x)


Price to Book Ratio

PB vs Industry: EOF is overvalued based on its PB Ratio (18.6x) compared to the AU Pharmaceuticals industry average (2.8x).


Next Steps

Future Growth

How is Ecofibre forecast to perform in the next 1 to 3 years based on estimates from 2 analysts?

54.7%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: EOF's forecast earnings growth (54.7% per year) is above the savings rate (1.1%).

Earnings vs Market: EOF's earnings (54.7% per year) are forecast to grow faster than the Australian market (9.4% per year).

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

Revenue vs Market: EOF's revenue (49.2% per year) is forecast to grow faster than the Australian market (3.6% per year).

High Growth Revenue: EOF's revenue (49.2% per year) is forecast to grow faster than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: EOF's Return on Equity is forecast to be high in 3 years time (37.5%)


Next Steps

Past Performance

How has Ecofibre performed over the past 5 years?

519.3%

Last years revenue growth


Earnings and Revenue History

Quality Earnings: EOF has a high level of non-cash earnings.

Growing Profit Margin: EOF became profitable in the past.


Past Earnings Growth Analysis

Earnings Trend: EOF has become profitable over the past 5 years, growing earnings by 0% per year.

Accelerating Growth: EOF has become profitable in the last year, making the earnings growth rate difficult to compare to its 5-year average.

Earnings vs Industry: EOF has become profitable in the last year, making it difficult to compare its past year earnings growth to the Pharmaceuticals industry (8.1%).


Return on Equity

High ROE: EOF's Return on Equity (14.2%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Ecofibre's financial position?


Financial Position Analysis

Short Term Liabilities: EOF's short term assets (A$38.7M) exceed its short term liabilities (A$5.1M).

Long Term Liabilities: EOF's short term assets (A$38.7M) exceed its long term liabilities (A$392.0K).


Debt to Equity History and Analysis

Debt Level: EOF's debt to equity ratio (3.2%) is considered satisfactory.

Reducing Debt: Insufficient data to determine if EOF's debt to equity ratio has reduced over the past 5 years.

Debt Coverage: EOF's debt is well covered by operating cash flow (181.9%).

Interest Coverage: EOF's interest payments on its debt are well covered by EBIT (13.9x coverage).


Balance Sheet

Inventory Level: EOF has a high level of physical assets or inventory.

Debt Coverage by Assets: EOF's debt is covered by short term assets (assets are 28.9x debt).


Next Steps

Dividend

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


Dividend Yield vs Market

companyn/amarketbottom25%2.4%markettop25%5.6%industryaverage2.6%forecastin3Years0%

Current dividend yield vs market & industry

Notable Dividend: Unable to evaluate EOF's dividend yield against the bottom 25% of dividend payers, as the company has not reported any payouts.

High Dividend: Unable to evaluate EOF's dividend yield against the top 25% of dividend payers, as the company has not reported any payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if EOF's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if EOF's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.


Future Payout to Shareholders

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


Next Steps

Management

What is the CEO of Ecofibre's salary, the management and board of directors tenure and is there insider trading?

2.2yrs

Average board tenure


CEO

Eric Wang 0

2yrs

Tenure

AU$1,527,000

Compensation

Mr. Eric Wang has been Chief Executive Officer and Managing Director of Ecofibre Limited since December 2017 and has been its Director since December 2015. Mr. Wang has over twenty five years of leadership ...


CEO Compensation Analysis

Compensation vs Market: Eric's total compensation ($USD1.04M) is above average for companies of similar size in the Australian market ($USD699.00K).

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


Board Age and Tenure

2.2yrs

Average Tenure

Experienced Board: EOF's board of directors are not considered experienced ( 2.2 years average tenure), which suggests a new board.


Insider Trading

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


Ownership Breakdown

Dilution of Shares: EOF only recently listed within the past 12 months, with total shares outstanding growing by 13.1% in the past year..


Management Team

  • Eric Wang

    CEO, MD & Director

    • Tenure: 2yrs
    • Compensation: AU$1.53m
  • Alastair Bor

    Chief Technology Officer

    • Tenure: 0yrs
  • Jonathan Brown

    CFO & Company Secretary

    • Tenure: 0yrs
    • Compensation: AU$826.00k
  • Alex Capano

    Chief Science Officer

    • Tenure: 0yrs
  • Adam Cantwell

    Vice President of Global Operations

    • Tenure: 0yrs
  • Jerry Newton

    Chief Operating Officer

    • Tenure: 0.3yrs

Board Members

  • Dave Neu (62yo)

    Executive Chairman of Ananda Health

    • Tenure: 0.3yrs
  • Barry Lambert (72yo)

    Non-Executive Chairman

    • Tenure: 2.2yrs
    • Compensation: AU$100.00k
  • Eric Wang

    CEO, MD & Director

    • Tenure: 2yrs
    • Compensation: AU$1.53m
  • Jon Meadmore

    Non-Executive Director

    • Tenure: 2.2yrs
    • Compensation: AU$90.00k

Company Information

Ecofibre Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Ecofibre Limited
  • Ticker: EOF
  • Exchange: ASX
  • Founded: 2009
  • Industry: Pharmaceuticals
  • Sector: Pharmaceuticals & Biotech
  • Market Cap: AU$803.424m
  • Shares outstanding: 297.56m
  • Website: https://www.ecofibre.com

Location

  • Ecofibre Limited
  • 680 George Street
  • Level 12
  • Sydney
  • New South Wales
  • 2000
  • Australia

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
EOFASX (Australian Securities Exchange)YesOrdinary SharesAUAUDMar 2019
EOFCHIA (Chi-X Australia)YesOrdinary SharesAUAUDMar 2019
EOFB.FOTCPK (Pink Sheets LLC)YesOrdinary SharesUSUSDMar 2019

Biography

Ecofibre Limited, together with its subsidiaries, engages in breeding, growing, processing, and distributing hemp products in the United States and Australia. The company offers protein powders, dehulled h ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/12/10 10:45
End of Day Share Price2019/12/10 00:00
Earnings2019/06/30
Annual Earnings2019/06/30


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.