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ABB LTD-SPON ADR (ABB) Stock Fundamental Analysis

NYSE:ABB - New York Stock Exchange, Inc. - US0003752047 - ADR - Currency: USD

37.13  -0.43 (-1.14%)

After market: 37.15 +0.02 (+0.05%)

Fundamental Rating

5

Overall ABB gets a fundamental rating of 5 out of 10. We evaluated ABB against 93 industry peers in the Electrical Equipment industry. While ABB has a great profitability rating, there are some minor concerns on its financial health. ABB has a decent growth rate and is not valued too expensively.


Dividend Valuation Growth Profitability Health

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8

1. Profitability

1.1 Basic Checks

ABB had positive earnings in the past year.
ABB had a positive operating cash flow in the past year.
ABB had positive earnings in each of the past 5 years.
ABB had a positive operating cash flow in each of the past 5 years.
ABB Yearly Net Income VS EBIT VS OCF VS FCFABB Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 1B 2B 3B 4B 5B

1.2 Ratios

ABB's Return On Assets of 7.26% is amongst the best of the industry. ABB outperforms 84.71% of its industry peers.
The Return On Equity of ABB (23.78%) is better than 91.76% of its industry peers.
With an excellent Return On Invested Capital value of 13.39%, ABB belongs to the best of the industry, outperforming 90.59% of the companies in the same industry.
ABB had an Average Return On Invested Capital over the past 3 years of 10.12%. This is in line with the industry average of 10.23%.
The last Return On Invested Capital (13.39%) for ABB is above the 3 year average (10.12%), which is a sign of increasing profitability.
Industry RankSector Rank
ROA 7.26%
ROE 23.78%
ROIC 13.39%
ROA(3y)10.05%
ROA(5y)7.63%
ROE(3y)27.12%
ROE(5y)21.51%
ROIC(3y)10.12%
ROIC(5y)8.59%
ABB Yearly ROA, ROE, ROICABB Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2015 2016 2017 2018 2019 2020 2021 2022 10 20 30

1.3 Margins

ABB has a Profit Margin of 9.58%. This is amongst the best in the industry. ABB outperforms 88.24% of its industry peers.
In the last couple of years the Profit Margin of ABB has remained more or less at the same level.
ABB has a Operating Margin of 12.81%. This is amongst the best in the industry. ABB outperforms 84.71% of its industry peers.
ABB's Operating Margin has improved in the last couple of years.
ABB has a Gross Margin of 33.50%. This is in the better half of the industry: ABB outperforms 77.65% of its industry peers.
In the last couple of years the Gross Margin of ABB has remained more or less at the same level.
Industry RankSector Rank
OM 12.81%
PM (TTM) 9.58%
GM 33.5%
OM growth 3Y19.92%
OM growth 5Y6.22%
PM growth 3Y17.79%
PM growth 5Y-0.88%
GM growth 3Y1.06%
GM growth 5Y0.78%
ABB Yearly Profit, Operating, Gross MarginsABB Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2015 2016 2017 2018 2019 2020 2021 2022 10 20 30

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4

2. Health

2.1 Basic Checks

The Return on Invested Capital (ROIC) is well above the Cost of Capital (WACC), so ABB is creating value.
Compared to 1 year ago, ABB has less shares outstanding
ABB has a worse debt/assets ratio than last year.
ABB Yearly Shares OutstandingABB Yearly Shares OutstandingYearly Shares Outstanding 2015 2016 2017 2018 2019 2020 2021 2022 500M 1B 1.5B 2B
ABB Yearly Total Debt VS Total AssetsABB Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2015 2016 2017 2018 2019 2020 2021 2022 10B 20B 30B 40B

2.2 Solvency

ABB has an Altman-Z score of 3.33. This indicates that ABB is financially healthy and has little risk of bankruptcy at the moment.
With a decent Altman-Z score value of 3.33, ABB is doing good in the industry, outperforming 65.88% of the companies in the same industry.
The Debt to FCF ratio of ABB is 6.17, which is on the high side as it means it would take ABB, 6.17 years of fcf income to pay off all of its debts.
ABB has a better Debt to FCF ratio (6.17) than 78.82% of its industry peers.
A Debt/Equity ratio of 0.43 indicates that ABB is not too dependend on debt financing.
Looking at the Debt to Equity ratio, with a value of 0.43, ABB is doing worse than 65.88% of the companies in the same industry.
Industry RankSector Rank
Debt/Equity 0.43
Debt/FCF 6.17
Altman-Z 3.33
ROIC/WACC2.21
WACC6.05%
ABB Yearly LT Debt VS Equity VS FCFABB Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 5B 10B 15B

2.3 Liquidity

ABB has a Current Ratio of 1.15. This is a normal value and indicates that ABB is financially healthy and should not expect problems in meeting its short term obligations.
The Current ratio of ABB (1.15) is worse than 85.88% of its industry peers.
ABB has a Quick Ratio of 1.15. This is a bad value and indicates that ABB is not financially healthy enough and could expect problems in meeting its short term obligations.
ABB has a Quick ratio of 0.80. This is amonst the worse of the industry: ABB underperforms 80.00% of its industry peers.
Industry RankSector Rank
Current Ratio 1.15
Quick Ratio 0.8
ABB Yearly Current Assets VS Current LiabilitesABB Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2015 2016 2017 2018 2019 2020 2021 2022 5B 10B 15B 20B 25B

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5

3. Growth

3.1 Past

ABB shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 41.41%, which is quite impressive.
Measured over the past years, ABB shows a quite strong growth in Earnings Per Share. The EPS has been growing by 9.04% on average per year.
ABB shows a small growth in Revenue. In the last year, the Revenue has grown by 4.59%.
The Revenue has been growing slightly by 3.17% on average over the past years.
EPS 1Y (TTM)41.41%
EPS 3Y15.52%
EPS 5Y9.04%
EPS Q2Q%47.37%
Revenue 1Y (TTM)4.59%
Revenue growth 3Y1.72%
Revenue growth 5Y3.17%
Sales Q2Q%12.84%

3.2 Future

The Earnings Per Share is expected to grow by 9.03% on average over the next years. This is quite good.
Based on estimates for the next years, ABB will show a small growth in Revenue. The Revenue will grow by 5.34% on average per year.
EPS Next Y-13.26%
EPS Next 2Y-2.88%
EPS Next 3Y1.22%
EPS Next 5Y9.03%
Revenue Next Year5.71%
Revenue Next 2Y4.82%
Revenue Next 3Y4.75%
Revenue Next 5Y5.34%

3.3 Evolution

The EPS growth rate is stable: in the next years the growth will be about the same than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
ABB Yearly Revenue VS EstimatesABB Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 10B 20B 30B 40B
ABB Yearly EPS VS EstimatesABB Yearly EPS VS EstimatesYearly EPS VS Estimates 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 0.5 1 1.5 2 2.5

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5

4. Valuation

4.1 Price/Earnings Ratio

A Price/Earnings ratio of 17.51 indicates a rather expensive valuation of ABB.
Based on the Price/Earnings ratio, ABB is valued cheaply inside the industry as 84.71% of the companies are valued more expensively.
When comparing the Price/Earnings ratio of ABB to the average of the S&P500 Index (29.63), we can say ABB is valued slightly cheaper.
Based on the Price/Forward Earnings ratio of 20.27, the valuation of ABB can be described as rather expensive.
Compared to the rest of the industry, the Price/Forward Earnings ratio of ABB indicates a somewhat cheap valuation: ABB is cheaper than 70.59% of the companies listed in the same industry.
ABB is valuated at similar levels of the S&P average when we compare the Price/Forward Earnings ratio to 22.68, which is the current average of the S&P500 Index.
Industry RankSector Rank
PE 17.51
Fwd PE 20.27
ABB Price Earnings VS Forward Price EarningsABB Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 5 10 15 20 25

4.2 Price Multiples

81.18% of the companies in the same industry are more expensive than ABB, based on the Enterprise Value to EBITDA ratio.
Based on the Price/Free Cash Flow ratio, ABB is valued a bit cheaper than the industry average as 75.29% of the companies are valued more expensively.
Industry RankSector Rank
P/FCF 49.22
EV/EBITDA 14.97
ABB Per share dataABB EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 5 10 15

4.3 Compensation for Growth

The excellent profitability rating of ABB may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)1.94
EPS Next 2Y-2.88%
EPS Next 3Y1.22%

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0

5. Dividend

5.1 Amount

ABB does not give a dividend.
Industry RankSector Rank
Dividend Yield N/A

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ABB LTD-SPON ADR

NYSE:ABB (5/22/2023, 8:15:14 PM)

After market: 37.15 +0.02 (+0.05%)

37.13

-0.43 (-1.14%)

Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryElectrical Equipment
Earnings (Last)04-25 2023-04-25/bmo
Earnings (Next)07-20 2023-07-20/bmo
Inst Owners0.11%
Inst Owner Change-6.54%
Ins OwnersN/A
Ins Owner ChangeN/A
Market Cap69.05B
Analysts72.12
Price Target38.91 (4.79%)
Short Float %N/A
Short RatioN/A
Dividend
Industry RankSector Rank
Dividend Yield N/A
Yearly DividendN/A
Dividend Growth(5Y)N/A
DP72.34%
Div Incr Years1
Div Non Decr Years1
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)27.5%
Min EPS beat(2)1.02%
Max EPS beat(2)53.99%
EPS beat(4)4
Avg EPS beat(4)23.33%
Min EPS beat(4)1.02%
Max EPS beat(4)53.99%
EPS beat(8)N/A
Avg EPS beat(8)N/A
EPS beat(12)N/A
Avg EPS beat(12)N/A
EPS beat(16)N/A
Avg EPS beat(16)N/A
Revenue beat(2)2
Avg Revenue beat(2)0.99%
Min Revenue beat(2)0.18%
Max Revenue beat(2)1.8%
Revenue beat(4)2
Avg Revenue beat(4)-1.52%
Min Revenue beat(4)-5.98%
Max Revenue beat(4)1.8%
Revenue beat(8)N/A
Avg Revenue beat(8)N/A
Revenue beat(12)N/A
Avg Revenue beat(12)N/A
Revenue beat(16)N/A
Avg Revenue beat(16)N/A
PT rev (1m)4.75%
PT rev (3m)10.04%
EPS NQ rev (1m)0%
EPS NQ rev (3m)28.08%
EPS NY rev (1m)0%
EPS NY rev (3m)2.31%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)2.11%
Revenue NY rev (1m)0%
Revenue NY rev (3m)5.2%
Valuation
Industry RankSector Rank
PE 17.51
Fwd PE 20.27
P/S 2.28
P/FCF 49.22
P/OCF 32.43
P/B 5.65
P/tB 123.09
EV/EBITDA 14.97
EPS(TTM)2.12
EY5.71%
EPS(NY)1.83
Fwd EY4.93%
FCF(TTM)0.75
FCFY2.03%
OCF(TTM)1.14
OCFY3.08%
SpS16.31
BVpS6.57
TBVpS0.3
PEG (NY)N/A
PEG (5Y)1.94
Profitability
Industry RankSector Rank
ROA 7.26%
ROE 23.78%
ROCE N/A
ROIC 13.39%
ROICexc 17.08%
ROICexgc 47.91%
OM 12.81%
PM (TTM) 9.58%
GM 33.5%
FCFM N/A
ROA(3y)10.05%
ROA(5y)7.63%
ROE(3y)27.12%
ROE(5y)21.51%
ROIC(3y)10.12%
ROIC(5y)8.59%
ROICexc(3y)12.91%
ROICexc(5y)10.74%
ROICexgc(3y)34.82%
ROICexgc(5y)28.24%
ROCE(3y)N/A
ROCE(5y)N/A
ROICexcg growth 3Y33.86%
ROICexcg growth 5Y16.29%
ROICexc growth 3Y28.94%
ROICexc growth 5Y12.32%
OM growth 3Y19.92%
OM growth 5Y6.22%
PM growth 3Y17.79%
PM growth 5Y-0.88%
GM growth 3Y1.06%
GM growth 5Y0.78%
F-Score7
Asset Turnover0.76
Health
Industry RankSector Rank
Debt/Equity 0.43
Debt/FCF 6.17
Debt/EBITDA 1.85
Cap/Depr 91.32%
Cap/Sales N/A
Interest Coverage N/A
Cash Conversion N/A
Profit Quality 48.26%
Current Ratio 1.15
Quick Ratio 0.8
Altman-Z 3.33
F-Score7
WACC6.05%
ROIC/WACC2.21
Cap/Depr(3y)87.09%
Cap/Depr(5y)84.97%
Cap/Sales(3y)N/A
Cap/Sales(5y)N/A
Profit Quality(3y)31.95%
Profit Quality(5y)60.7%
High Growth Momentum
Growth
EPS 1Y (TTM)41.41%
EPS 3Y15.52%
EPS 5Y9.04%
EPS Q2Q%47.37%
EPS Next Y-13.26%
EPS Next 2Y-2.88%
EPS Next 3Y1.22%
EPS Next 5Y9.03%
Revenue 1Y (TTM)4.59%
Revenue growth 3Y1.72%
Revenue growth 5Y3.17%
Sales Q2Q%12.84%
Revenue Next Year5.71%
Revenue Next 2Y4.82%
Revenue Next 3Y4.75%
Revenue Next 5Y5.34%
EBIT growth 1Y-34.08%
EBIT growth 3Y21.98%
EBIT growth 5Y9.58%
EBIT Next Year45.33%
EBIT Next 3Y17.05%
EBIT Next 5YN/A
FCF growth 1Y-34.44%
FCF growth 3Y-30.49%
FCF growth 5Y-29.65%
OCF growth 1Y-24.32%
OCF growth 3Y-17.89%
OCF growth 5Y-19.47%