Exploring NYSE:ALSN's dividend characteristics.

Our stock screener has spotted ALLISON TRANSMISSION HOLDING (NYSE:ALSN) as a good dividend stock with solid fundamentals. NYSE:ALSN shows decent health and profitability. At the same time it gives a good and sustainable dividend. We'll dive into each aspect below.

Analyzing Dividend Metrics

ChartMill assigns a proprietary Dividend Rating to each stock. The score is computed by evaluating various valuation aspects, like the yield, the history, the dividend growth and sustainability. NYSE:ALSN was assigned a score of 7 for dividend:

• Compared to an average industry Dividend Yield of 1.73, ALSN pays a bit more dividend than its industry peers.
• The dividend of ALSN is nicely growing with an annual growth rate of 7.40%!
• ALSN has been paying a dividend for at least 10 years, so it has a reliable track record.
• ALSN has not decreased their dividend for at least 10 years, which is a reliable track record.
• 12.73% of the earnings are spent on dividend by ALSN. This is a low number and sustainable payout ratio.
• ALSN's earnings are growing more than its dividend. This makes the dividend growth sustainable.

Evaluating Health: NYSE:ALSN

A critical element of ChartMill's stock evaluation is the Health Rating, which spans from 0 to 10. This rating considers multiple health factors, including liquidity and solvency, both in absolute terms and relative to industry peers. NYSE:ALSN has received a 6 out of 10:

• Looking at the Debt to FCF ratio, with a value of 4.14, ALSN is in the better half of the industry, outperforming 61.83% of the companies in the same industry.
• A Current Ratio of 2.41 indicates that ALSN has no problem at all paying its short term obligations.
• ALSN's Current ratio of 2.41 is fine compared to the rest of the industry. ALSN outperforms 63.36% of its industry peers.
• With a decent Quick ratio value of 1.86, ALSN is doing good in the industry, outperforming 74.05% of the companies in the same industry.

Understanding NYSE:ALSN's Profitability

ChartMill utilizes a Profitability Rating to assess stocks, scoring them on a scale of 0 to 10. This rating takes into account a variety of profitability ratios and margins, both in absolute terms and in comparison to industry peers. NYSE:ALSN has earned a 8 out of 10:

• ALSN has a Return On Assets of 12.91%. This is amongst the best in the industry. ALSN outperforms 90.08% of its industry peers.
• ALSN has a Return On Equity of 54.39%. This is amongst the best in the industry. ALSN outperforms 98.47% of its industry peers.
• Looking at the Return On Invested Capital, with a value of 15.77%, ALSN belongs to the top of the industry, outperforming 87.79% of the companies in the same industry.
• ALSN had an Average Return On Invested Capital over the past 3 years of 12.92%. This is above the industry average of 10.55%.
• The 3 year average ROIC (12.92%) for ALSN is below the current ROIC(15.77%), indicating increased profibility in the last year.
• ALSN has a Profit Margin of 21.63%. This is amongst the best in the industry. ALSN outperforms 98.47% of its industry peers.
• ALSN has a better Operating Margin (29.75%) than 99.24% of its industry peers.
• ALSN has a better Gross Margin (48.25%) than 93.13% of its industry peers.

Every day, new Best Dividend stocks can be found on ChartMill in our Best Dividend screener.

Our latest full fundamental report of ALSN contains the most current fundamental analsysis.

Disclaimer

This is not investing advice! The article highlights some of the observations at the time of writing, but you should always make your own analysis and invest based on your own insights.