DB:ESW

Stock Analysis Report

Executive Summary

Essity AB (publ) develops, produces, and sells personal care, consumer tissue, and professional hygiene products and solutions worldwide.


Snowflake Analysis

Solid track record with mediocre balance sheet.


Similar Companies

Share Price & News

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


Latest Share Price and Events

Stable Share Price: ESW has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

-0.5%

ESW

1.7%

DE Household Products

7.3%

DE Market


1 Year Return

5.2%

ESW

-8.8%

DE Household Products

-17.7%

DE Market

Return vs Industry: ESW exceeded the German Household Products industry which returned -9% over the past year.

Return vs Market: ESW exceeded the German Market which returned -17.5% over the past year.


Shareholder returns

ESWIndustryMarket
7 Day-0.5%1.7%7.3%
30 Day1.3%-2.4%-17.9%
90 Day-6.7%-9.9%-25.8%
1 Year7.6%5.2%-6.5%-8.8%-15.1%-17.7%
3 Yearn/a-23.7%-28.5%-18.7%-25.6%
5 Yearn/a-7.6%-16.3%-17.7%-29.0%

Price Volatility Vs. Market

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


Simply Wall St News

No news available

Valuation

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

43.6%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: ESW (€27.1) is trading below our estimate of fair value (€48.02)

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


Price To Earnings Ratio

PE vs Industry: ESW is poor value based on its PE Ratio (22.2x) compared to the Household Products industry average (21.3x).

PE vs Market: ESW is poor value based on its PE Ratio (22.2x) compared to the German market (16.5x).


Price to Earnings Growth Ratio

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


Price to Book Ratio

PB vs Industry: ESW is overvalued based on its PB Ratio (3.8x) compared to the XE Household Products industry average (1.7x).


Next Steps

Future Growth

How is Essity forecast to perform in the next 1 to 3 years based on estimates from 14 analysts?

10.0%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: ESW's forecast earnings growth (10% per year) is above the savings rate (-0.4%).

Earnings vs Market: ESW's earnings (10% per year) are forecast to grow slower than the German market (14.2% per year).

High Growth Earnings: ESW's earnings are forecast to grow, but not significantly.

Revenue vs Market: ESW's revenue (2.8% per year) is forecast to grow slower than the German market (4.2% per year).

High Growth Revenue: ESW's revenue (2.8% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: ESW's Return on Equity is forecast to be low in 3 years time (17.9%).


Next Steps

Past Performance

How has Essity performed over the past 5 years?

14.7%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: ESW has high quality earnings.

Growing Profit Margin: ESW's current net profit margins (7.1%) are higher than last year (6.7%).


Past Earnings Growth Analysis

Earnings Trend: ESW's earnings have grown by 14.7% per year over the past 5 years.

Accelerating Growth: ESW's earnings growth over the past year (16.9%) exceeds its 5-year average (14.7% per year).

Earnings vs Industry: ESW earnings growth over the past year (16.9%) exceeded the Household Products industry 7.7%.


Return on Equity

High ROE: ESW's Return on Equity (16.3%) is considered low.


Next Steps

Financial Health

How is Essity's financial position?


Financial Position Analysis

Short Term Liabilities: ESW's short term assets (SEK42.0B) do not cover its short term liabilities (SEK43.3B).

Long Term Liabilities: ESW's short term assets (SEK42.0B) do not cover its long term liabilities (SEK56.2B).


Debt to Equity History and Analysis

Debt Level: ESW's debt to equity ratio (76.7%) is considered high.

Reducing Debt: ESW's debt to equity ratio has reduced from 90.7% to 76.7% over the past 5 years.

Debt Coverage: ESW's debt is well covered by operating cash flow (40.2%).

Interest Coverage: ESW's interest payments on its debt are well covered by EBIT (11.8x coverage).


Balance Sheet

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

Debt Coverage by Assets: ESW's debt is not covered by short term assets (assets are 0.9x debt).


Next Steps

Dividend

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

2.15%

Current Dividend Yield


Upcoming Dividend Payment

TodayMar 30 2020Ex Dividend DateApr 03 2020Dividend Pay DateApr 09 20206 days from Ex DividendBuy in the next 4 days to receive the upcoming dividend

Dividend Yield vs Market

Notable Dividend: ESW's dividend (2.15%) is higher than the bottom 25% of dividend payers in the German market (1.71%).

High Dividend: ESW's dividend (2.15%) is low compared to the top 25% of dividend payers in the German market (4.98%).


Stability and Growth of Payments

Stable Dividend: Whilst dividend payments have been stable, ESW has been paying a dividend for less than 10 years.

Growing Dividend: ESW's dividend payments have increased, but the company has only paid a dividend for 2 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (47.6%), ESW's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: ESW's dividends in 3 years are forecast to be well covered by earnings (44.2% payout ratio).


Next Steps

Management

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

5.2yrs

Average management tenure


CEO

Magnus Groth (56yo)

3.17s

Tenure

kr33,462,410

Compensation

Mr. Magnus Groth, MBA, MSc Econ, ME, has been President and Chief Executive Officer of Essity Aktiebolag (publ) since 2017 and has been its Director since 2016. Mr. Groth served as the Chief Executive Offi ...


CEO Compensation Analysis

Compensation vs Market: Magnus's total compensation ($USD3.37M) is below average for companies of similar size in the German market ($USD5.11M).

Compensation vs Earnings: Magnus's compensation has increased by more than 20% in the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Magnus Groth
President3.17yrskr33.46m0.0077% SEK1.4m
Carl Fredrik Rystedt
CFO & Executive VP3.17yrsno data0.0027% SEK496.0k
Johan Karlsson
VP of Investor Relations & Group Function Communicationsno datano datano data
Mikael Schmidt
Senior VP of Group Function Legal Affairs8.17yrsno data0.0038% SEK710.7k
Per Lorentz
VP of Corporate Communications & Group Function Communicationsno datano datano data
Karl Stoltz
Manager of Media Relationsno datano datano data
Anna Sävinger-Åslund
Senior Vice President of Group Function Human Resources5.17yrsno datano data
Donald Lewis
President of Professional Hygiene8.17yrsno data0.0032% SEK583.0k
Volker Zöller
President of Consumer Goods5.17yrsno data0.0014% SEK262.8k
Pablo Fuentes
President of Latin America4.17yrsno data0.0024% SEK436.8k

5.2yrs

Average Tenure

56yo

Average Age

Experienced Management: ESW's management team is seasoned and experienced (5.2 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Magnus Groth
President3.17yrskr33.46m0.0077% SEK1.4m
Bert Ake Nordberg
Independent Director4.17yrskr1.16m0.0024% SEK442.4k
Maija-Liisa Friman
Independent Director4.17yrskr770.00kno data
Annemarie Gardshol
Independent Director4.17yrskr770.00k0.00033% SEK61.1k
Par Boman
Independent Chairman of the Board4.17yrskr2.74m0.00043% SEK79.6k
Barbara Milian Thoralfsson
Independent Non-Executive Director4.17yrskr1.15mno data
Örjan Svensson
Employee Representative Director3.17yrsno data0.000020% SEK3.7k
Louise Svanberg
Independent Director4.17yrskr885.00k0.0031% SEK581.2k
Ewa Björling
Independent Director4.17yrskr770.00kno data
Lars Sörensen
Independent Director3.17yrskr770.00kno data

4.2yrs

Average Tenure

59yo

Average Age

Experienced Board: ESW's board of directors are considered experienced (4.2 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.


Ownership Breakdown

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


Top Shareholders

Company Information

Essity AB (publ)'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Essity AB (publ)
  • Ticker: ESW
  • Exchange: DB
  • Founded: 1849
  • Industry: Household Products
  • Sector: Household
  • Market Cap: kr203.998b
  • Listing Market Cap: kr18.509b
  • Shares outstanding: 702.34m
  • Website: https://www.essity.com

Number of Employees


Location

  • Essity AB (publ)
  • Waterfront Building
  • Klarabergsviadukten 63
  • Stockholm
  • Stockholm County
  • 101 23
  • Sweden

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
ESSITY AOM (OMX Nordic Exchange Stockholm)Class A SharesSESEKJun 2017
ESSITY BOM (OMX Nordic Exchange Stockholm)YesClass B SharesSESEKJun 2017
0RQCLSE (London Stock Exchange)Class A SharesGBSEKJun 2017
0RQDLSE (London Stock Exchange)YesClass B SharesGBSEKJun 2017
ESSIBSBATS-CHIXE (BATS 'Chi-X Europe')YesClass B SharesGBSEKJun 2017
ESWBDB (Deutsche Boerse AG)YesClass B SharesDEEURJun 2017
ESWDB (Deutsche Boerse AG)Class A SharesDEEURJun 2017
ESSIASBATS-CHIXE (BATS 'Chi-X Europe')Class A SharesGBSEKJun 2017
ETTY.FOTCPK (Pink Sheets LLC)YesClass B SharesUSUSDJun 2017
ESSITYB NBMV (Bolsa Mexicana de Valores)YesClass B SharesMXMXNJun 2017
ESWADB (Deutsche Boerse AG)SPON ADR EACH REP 1 SHSDEEURJun 2017

Biography

Essity AB (publ) develops, produces, and sells personal care, consumer tissue, and professional hygiene products and solutions worldwide. It offers personal care products include incontinence products, including skincare products, wet wipes, and wash gloves; baby and pant diapers, as well as baby care products, such as wet wipes, shampoos, lotions, and baby oils; pads, panty liners, tampons, intimate soaps, and intimate wipes; and wound care, vascular, and orthopedics products and services. Its personal care products comprise medical solutions that include surgical tapes, retention bandages, surgical/post-operation dressings, adhesive bandages/plasters, and advanced wound care products; phlebology products, such as compression stockings, and medical compression garments; lymphology products, such as compression bandages, wraps, garments and pneumatic compression pumps; and fracture management products that include cast tapes, splinting, casting accessories, and physiotherapy and orthopedic soft goods and braces. In addition, the company offers consumer tissue products, including toilet paper, household towels, handkerchiefs, facial tissues, wet wipes, and napkins. Further, it provides hygiene solutions that include toilet paper, paper hand towels, napkins, hand soaps and lotions, hand sanitizers, dispensers, cleaning and wiping products, and Internet of Things sensor technology products, as well as related service and maintenance to companies and office buildings, universities, healthcare facilities, industries, restaurants, hotels, stadiums, and other public venues. The company markets its personal care products primarily under the TENA, JOBST, Leukoplast, Libero, Libresse, Nosotras, and Saba, as well as other retailer’s brands; consumer tissue products under the Edet, Lotus, Regio, Tempo, Vinda and Zewa, and retailer brands; and professional hygiene products under the TORK brand. Essity AB (publ) was founded in 1849 and is headquartered in Stockholm, Sweden. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/03/29 23:48
End of Day Share Price2020/03/27 00:00
Earnings2019/12/31
Annual Earnings2019/12/31


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.