Emeco Holdings Limited (EHL) AI Stock Analysis

• Market Cap: AU$467.87M
• Dividend Yield: N/A
• Average Volume (3M): 641.63K
• Price to Earnings (P/E): 7.0
• Beta (1Y): 0.93
• Revenue Growth: -11.86%
• EPS Growth: 15.29%
• Country: AU
• Employees: 1,400
• Sector: Industrials
• Sector Strength: 94
• Industry: Rental & Leasing Services
• EPS (TTM): 0.07
• Shares Outstanding: 518,374,760
• 10 Day Avg. Volume: 262,061
• 30 Day Avg. Volume: 641,628
• PEG Ratio: 0.22
• Price to Book (P/B): 0.67
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 8.03
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: AU$1.00
• Price Target Upside: 13.86% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1

• Rating: 73 Outperform
• Price Target: AU$1.00 ▲(13.64%Upside)

Emeco Holdings Limited's strong financial performance and attractive valuation are the primary drivers of its stock score. The bullish technical indicators further support the positive outlook, despite concerns about declining revenue and free cash flow.

Emeco Holdings Limited Business Overview & Revenue Model

Company Description

Emeco Holdings Limited (EHL) is an Australian-based company that specializes in providing heavy earthmoving equipment solutions to the mining industry. The company offers a range of services including equipment rental, maintenance, and repair services, as well as asset management and fleet optimization solutions. Emeco operates predominantly in Australia but also serves international markets, focusing on delivering reliable and efficient equipment solutions to its mining industry clients.

How the Company Makes Money

Emeco Holdings Limited makes money primarily through its equipment rental services, where it leases heavy earthmoving machinery to mining companies. The company generates significant revenue by offering both short-term and long-term equipment rental agreements, tailored to the specific needs of its clients. Additionally, Emeco provides maintenance and repair services, ensuring the optimal performance of its fleet, which is another key revenue stream. The company also benefits from asset management and fleet optimization services, helping clients improve operational efficiencies. Strategic partnerships with mining operators and a focus on high-utilization regions further contribute to Emeco's earnings, enhancing its market position and driving revenue growth.

Emeco Holdings Limited Financial Statement Overview

Summary

Emeco Holdings Limited exhibits strong profitability with improved profit margins and return on equity. However, challenges include declining revenue and reduced free cash flow, indicating a need for focus on revenue growth and liquidity management.

Income Statement

Emeco Holdings Limited demonstrated a robust improvement in profitability with a remarkable gross profit margin of 56.4% for 2024, up from 20.5% in 2023. The company also showed a positive net profit margin of 6.4% in 2024, an improvement from 4.7% in 2023. However, the revenue declined by 6% from the previous year, which is a concern. The EBIT margin improved significantly to 43.3% in 2024, indicating efficient cost management.

Balance Sheet

The company's debt-to-equity ratio stands at 0.56, reflecting a stable capital structure with reasonable leverage. The return on equity for 2024 increased to 8.3% from 7% in the prior year, showcasing improved profitability for shareholders. The equity ratio is a healthy 54.2%, indicating strong shareholder equity backing the assets. However, there is a slight increase in total debt, which should be monitored.

Cash Flow

Free cash flow decreased from 2023 to 2024, which might impact future liquidity. The operating cash flow to net income ratio is favorable, indicating strong cash generation from operations relative to reported net income. However, the free cash flow to net income ratio reflects a decline, highlighting challenges in maintaining free cash flow levels.

Breakdown	Jun 2024	Jun 2023	Jun 2022	Jun 2021	Jun 2020
Income Statement
Total Revenue	822.73M	874.92M	754.37M	620.53M	540.43M
Gross Profit	464.32M	179.65M	178.91M	167.48M	165.04M
EBITDA	258.19M	224.52M	244.31M	216.10M	223.00M
Net Income	52.66M	41.33M	64.95M	20.70M	66.13M
Balance Sheet
Total Assets	1.17B	1.09B	1.02B	1.06B	1.16B
Cash, Cash Equivalents and Short-Term Investments	78.27M	46.67M	60.16M	74.72M	198.17M
Total Debt	358.74M	322.65M	301.06M	299.21M	620.02M
Total Liabilities	537.52M	498.98M	454.29M	528.96M	805.63M
Stockholders Equity	637.24M	589.44M	567.22M	531.41M	357.25M
Cash Flow
Free Cash Flow	22.22M	26.98M	50.73M	51.46M	63.14M
Operating Cash Flow	237.17M	206.39M	221.15M	205.62M	181.97M
Investing Cash Flow	-201.43M	-180.88M	-169.87M	-149.56M	-169.85M
Financing Cash Flow	-4.13M	-38.99M	-65.69M	-179.47M	149.82M

Emeco Holdings Limited Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 0.88
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AU:EHL, the sentiment is Positive. The current price of 0.88 is above the 20-day moving average (MA) of 0.86, above the 50-day MA of 0.81, and above the 200-day MA of 0.83, indicating a bullish trend. The MACD of 0.02 indicates Negative momentum. The RSI at 65.55 is Neutral, neither overbought nor oversold. The STOCH value of 87.46 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for AU:EHL.

Emeco Holdings Limited Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
GNG	84 Outperform	AU$610.84M	15.48	58.99%	5.48%	25.12%	31.13%
EHL	73 Outperform	AU$467.87M	7.02	10.65%	―	-11.86%	15.29%
KSC	70 Outperform	AU$473.49M	15.60	8.92%	4.62%	-6.12%	2.79%
ACF	69 Neutral	€320.32M	13.87	16.85%	5.70%	28.56%	-19.61%
BOL	68 Neutral	€55.10M	2.57	18.38%	―	10.70%	―
GNP	67 Neutral	AU$773.00M	32.07	19.31%	0.58%	35.02%	48.51%
Sector *	59 Neutral	AU$1.65B	10.34	11.24%	3.42%	6.75%	3.18%

Emeco Holdings Limited Corporate Events

Emeco Holdings Highlights Financial Performance and Strategic Initiatives at Industry Forum

Emeco Holdings Limited presented at the Euroz Hartleys Industrial & Resources Forum, highlighting its financial performance and strategic initiatives. The presentation emphasized the company’s use of non-IFRS financial measures to assess operational performance, although these figures have not been audited. The company cautioned that forward-looking statements are subject to risks and uncertainties, which could impact future performance.

The most recent analyst rating on (AU:EHL) stock is a Buy with a A$1.05 price target. To see the full list of analyst forecasts on Emeco Holdings Limited stock, see the AU:EHL Stock Forecast page.

Emeco Reaffirms FY25 Earnings Guidance Amid Resilient Performance

Emeco Holdings Limited has reaffirmed its FY25 earnings guidance, projecting an Operating EBITDA target of $300 million. The company has effectively managed costs and leveraged its competitive advantage to mitigate weather-related impacts, maintaining a strong cash return for shareholders. With no growth capex for the year and a focus on equipment redeployment, Emeco is poised to achieve its earnings targets for FY25 and anticipates continued growth in FY26, supported by a lower cost base, reduced debt levels, and positive production activity in the mining sector.

The most recent analyst rating on (AU:EHL) stock is a Buy with a A$1.05 price target. To see the full list of analyst forecasts on Emeco Holdings Limited stock, see the AU:EHL Stock Forecast page.