NASDAQ:ASO, an undervalued stock with good fundamentals.

Last update: Jul 19, 2024

Consider ACADEMY SPORTS & OUTDOORS IN (NASDAQ:ASO) as a top value stock, identified by our stock screening tool. NASDAQ:ASO shines in terms of profitability, solvency, and liquidity, all while remaining very reasonably priced. Let's dive deeper into the analysis.

Valuation Assessment of NASDAQ:ASO

ChartMill assigns a Valuation Rating to every stock. This score ranges from 0 to 10 and evaluates the different valuation aspects and compares the price to earnings and cash flows, while taking into account profitability and growth. NASDAQ:ASO scores a 8 out of 10:

With a Price/Earnings ratio of 8.27, the valuation of ASO can be described as very reasonable.
Based on the Price/Earnings ratio, ASO is valued cheaper than 94.40% of the companies in the same industry.
The average S&P500 Price/Earnings ratio is at 28.83. ASO is valued rather cheaply when compared to this.
The Price/Forward Earnings ratio is 7.54, which indicates a rather cheap valuation of ASO.
Compared to the rest of the industry, the Price/Forward Earnings ratio of ASO indicates a rather cheap valuation: ASO is cheaper than 89.60% of the companies listed in the same industry.
ASO's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 20.60.
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of ASO indicates a rather cheap valuation: ASO is cheaper than 85.60% of the companies listed in the same industry.
Based on the Price/Free Cash Flow ratio, ASO is valued cheaply inside the industry as 83.20% of the companies are valued more expensively.
The excellent profitability rating of ASO may justify a higher PE ratio.

Assessing Profitability for NASDAQ:ASO

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. NASDAQ:ASO has earned a 9 out of 10:

ASO has a Return On Assets of 10.29%. This is amongst the best in the industry. ASO outperforms 84.00% of its industry peers.
ASO has a better Return On Equity (26.33%) than 81.60% of its industry peers.
ASO has a better Return On Invested Capital (13.51%) than 80.80% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for ASO is above the industry average of 13.71%.
The last Return On Invested Capital (13.51%) for ASO is well below the 3 year average (17.55%), which needs to be investigated, but indicates that ASO had better years and this may not be a problem.
With an excellent Profit Margin value of 8.17%, ASO belongs to the best of the industry, outperforming 84.80% of the companies in the same industry.
In the last couple of years the Profit Margin of ASO has grown nicely.
ASO's Operating Margin of 10.65% is amongst the best of the industry. ASO outperforms 85.60% of its industry peers.
In the last couple of years the Operating Margin of ASO has grown nicely.
ASO's Gross Margin has improved in the last couple of years.

Unpacking NASDAQ:ASO's Health Rating

Every stock is evaluated by ChartMill, receiving a Health Rating on a scale of 0 to 10. This assessment considers different health aspects, including liquidity and solvency, both in absolute terms and relative to industry peers. NASDAQ:ASO has achieved a 7 out of 10:

An Altman-Z score of 3.17 indicates that ASO is not in any danger for bankruptcy at the moment.
The Altman-Z score of ASO (3.17) is better than 68.00% of its industry peers.
The Debt to FCF ratio of ASO is 1.01, which is an excellent value as it means it would take ASO, only 1.01 years of fcf income to pay off all of its debts.
Looking at the Debt to FCF ratio, with a value of 1.01, ASO is in the better half of the industry, outperforming 79.20% of the companies in the same industry.
A Debt/Equity ratio of 0.25 indicates that ASO is not too dependend on debt financing.
ASO has a better Current ratio (1.62) than 63.20% of its industry peers.
The current and quick ratio evaluation for ASO is rather negative, while it does have excellent solvency and profitability. These ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.

A Closer Look at Growth for NASDAQ:ASO

ChartMill assigns a proprietary Growth Rating to each stock. The score is computed by evaluating various growth aspects, like EPS and revenue growth. We take into account the history as well as the estimated future numbers. NASDAQ:ASO was assigned a score of 4 for growth:

The Earnings Per Share has been growing by 94.62% on average over the past years. This is a very strong growth
Based on estimates for the next years, ASO will show a quite strong growth in Earnings Per Share. The EPS will grow by 10.51% on average per year.

More Decent Value stocks can be found in our Decent Value screener.

Check the latest full fundamental report of ASO for a complete fundamental analysis.

Disclaimer

Important Note: The content of this article is not intended as trading advice. It is essential to perform your own analysis and exercise caution when making trading decisions. The article presents observations created by automated analysis but does not guarantee any trading or investment outcomes. Always trade responsibly and make independent judgments.