Today we're going to take a closer look at Mid-Cap Basic Materials company ERAMET, whose shares are currently trading at $90.62. We've been asking ourselves whether the company is under or over valued at today's prices... let's perform a brief value analysis to find out!
A Lower P/B Ratio Than Its Sector Average but Trades Above Its Graham Number:
ERAMET S.A. operates as a mining and metallurgical company in France, Asia, Europe, North America, and internationally. The company belongs to the Basic Materials sector, which has an average price to earnings (P/E) ratio of 10.03 and an average price to book (P/B) ratio of 2.08. In contrast, ERAMET has a trailing 12 month P/E ratio of 2.7 and a P/B ratio of 1.36.
ERAMET has moved -2735.9% over the last year compared to 1412.7% for the S&P 500 — a difference of -4149.0%. ERAMET has a 52 week high of $124.75 and a 52 week low of $66.75.
Wider Gross Margins Than the Industry Average of 32.76%:
| 2019-12-31 | 2020-12-31 | 2021-12-31 | 2022-12-31 | |
|---|---|---|---|---|
| Revenue (MM) | $3,683 | $3,553 | $3,668 | $5,014 |
| Gross Margins | 15.3% | 55.3% | 66.7% | 64.8% |
| Operating Margins | 6.6% | 1.2% | 20.8% | 25.4% |
| Net Margins | -5.0% | -19.0% | 8.12% | 14.76% |
| Net Income (MM) | -$184 | -$675 | $298 | $740 |
| Net Interest Expense (MM) | -119 | -122 | -121 | -96 |
| Net Interest Expense (MM) | -$119 | -$122 | -$121 | -$96 |
| Depreciation & Amort. (MM) | -$313 | -$754 | -$142 | -$489 |
| Earnings Per Share | -$6.93 | -$25.46 | $10.37 | $33.67 |
| EPS Growth | n/a | -267.39% | 140.73% | 224.69% |
| Diluted Shares (MM) | 27 | 27 | 29 | 29 |
| Free Cash Flow (MM) | -$370 | -$33 | $331 | $461 |
| Capital Expenditures (MM) | -$456 | -$342 | -$312 | -$530 |
| Net Current Assets (MM) | -$1,668 | -$2,009 | -$1,791 | -$932 |
| Current Ratio | 1.65 | 2.3 | 1.45 | 1.58 |
| Long Term Debt (MM) | $1,558 | $2,830 | $1,578 | $1,393 |
| Net Debt / EBITDA | 3.34 | 5.13 | 1.91 | 0.51 |
ERAMET benefits from growing revenues and increasing reinvestment in the business, exceptional EPS growth, and a pattern of improving cash flows. The company's financial statements show low leverage and wider gross margins than its peer group. However, the firm has weak operating margins with a positive growth rate. Finally, we note that ERAMET has a decent current ratio.
