ABM INDUSTRIES INC (ABM) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:ABM - US0009571003 - Common Stock
46.325 USD
-0.04 (-0.1%)
Taking everything into account, ABM scores 5 out of 10 in our fundamental rating. ABM was compared to 80 industry peers in the Commercial Services & Supplies industry. Both the profitability and the financial health of ABM get a neutral evaluation. Nothing too spectacular is happening here. ABM has a correct valuation and a medium growth rate. Finally ABM also has an excellent dividend rating.
1. Profitability
1.1 Basic Checks
- ABM had positive earnings in the past year.
- ABM had a positive operating cash flow in the past year.
- Each year in the past 5 years ABM has been profitable.
- In the past 5 years ABM always reported a positive cash flow from operatings.
1.2 Ratios
- ABM has a Return On Assets of 3.08%. This is in the better half of the industry: ABM outperforms 63.75% of its industry peers.
- Looking at the Return On Equity, with a value of 9.09%, ABM is in the better half of the industry, outperforming 68.75% of the companies in the same industry.
- Looking at the Return On Invested Capital, with a value of 5.53%, ABM is in line with its industry, outperforming 57.50% of the companies in the same industry.
- The Average Return On Invested Capital over the past 3 years for ABM is below the industry average of 10.58%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.08% | ||
| ROE | 9.09% | ||
| ROIC | 5.53% |
ROA(3y)3.26%
ROA(5y)3.47%
ROE(3y)9.21%
ROE(5y)9.78%
ROIC(3y)5.59%
ROIC(5y)5.54%
1.3 Margins
- ABM has a Profit Margin (1.86%) which is comparable to the rest of the industry.
- ABM's Profit Margin has improved in the last couple of years.
- ABM has a Operating Margin of 3.72%. This is comparable to the rest of the industry: ABM outperforms 48.75% of its industry peers.
- ABM's Operating Margin has declined in the last couple of years.
- The Gross Margin of ABM (12.29%) is worse than 85.00% of its industry peers.
- In the last couple of years the Gross Margin of ABM has declined.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 3.72% | ||
| PM (TTM) | 1.86% | ||
| GM | 12.29% |
OM growth 3Y-5.26%
OM growth 5Y-4.22%
PM growth 3Y-14.31%
PM growth 5Y226.42%
GM growth 3Y-2.09%
GM growth 5Y-2.38%
2. Health
2.1 Basic Checks
- The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so ABM is destroying value.
- The number of shares outstanding for ABM has been reduced compared to 1 year ago.
- Compared to 5 years ago, ABM has less shares outstanding
- Compared to 1 year ago, ABM has a worse debt to assets ratio.
2.2 Solvency
- ABM has an Altman-Z score of 2.86. This is not the best score and indicates that ABM is in the grey zone with still only limited risk for bankruptcy at the moment.
- ABM's Altman-Z score of 2.86 is in line compared to the rest of the industry. ABM outperforms 60.00% of its industry peers.
- The Debt to FCF ratio of ABM is 10.10, which is on the high side as it means it would take ABM, 10.10 years of fcf income to pay off all of its debts.
- ABM has a Debt to FCF ratio (10.10) which is in line with its industry peers.
- A Debt/Equity ratio of 0.86 indicates that ABM is somewhat dependend on debt financing.
- ABM's Debt to Equity ratio of 0.86 is on the low side compared to the rest of the industry. ABM is outperformed by 60.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.86 | ||
| Debt/FCF | 10.1 | ||
| Altman-Z | 2.86 |
ROIC/WACC0.7
WACC7.87%
2.3 Liquidity
- ABM has a Current Ratio of 1.48. This is a normal value and indicates that ABM is financially healthy and should not expect problems in meeting its short term obligations.
- ABM's Current ratio of 1.48 is in line compared to the rest of the industry. ABM outperforms 51.25% of its industry peers.
- ABM has a Quick Ratio of 1.48. This is a normal value and indicates that ABM is financially healthy and should not expect problems in meeting its short term obligations.
- The Quick ratio of ABM (1.48) is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.48 | ||
| Quick Ratio | 1.48 |
3. Growth
3.1 Past
- ABM shows a slight negative growth in Earnings Per Share. In the last year, the EPS has decreased by -3.92%.
- Measured over the past 5 years, ABM shows a small growth in Earnings Per Share. The EPS has been growing by 7.14% on average per year.
- ABM shows a small growth in Revenue. In the last year, the Revenue has grown by 4.62%.
- Measured over the past years, ABM shows a small growth in Revenue. The Revenue has been growing by 7.87% on average per year.
EPS 1Y (TTM)-3.92%
EPS 3Y-2.14%
EPS 5Y7.14%
EPS Q2Q%-2.22%
Revenue 1Y (TTM)4.62%
Revenue growth 3Y3.86%
Revenue growth 5Y7.87%
Sales Q2Q%5.42%
3.2 Future
- The Earnings Per Share is expected to grow by 10.00% on average over the next years. This is quite good.
- ABM is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 3.73% yearly.
EPS Next Y16.83%
EPS Next 2Y13.9%
EPS Next 3Y10%
EPS Next 5YN/A
Revenue Next Year4.96%
Revenue Next 2Y4.22%
Revenue Next 3Y3.73%
Revenue Next 5YN/A
3.3 Evolution
- When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
- When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
- ABM is valuated correctly with a Price/Earnings ratio of 13.51.
- ABM's Price/Earnings ratio is rather cheap when compared to the industry. ABM is cheaper than 85.00% of the companies in the same industry.
- ABM is valuated cheaply when we compare the Price/Earnings ratio to 27.30, which is the current average of the S&P500 Index.
- ABM is valuated reasonably with a Price/Forward Earnings ratio of 11.56.
- Based on the Price/Forward Earnings ratio, ABM is valued cheaper than 90.00% of the companies in the same industry.
- ABM is valuated cheaply when we compare the Price/Forward Earnings ratio to 24.32, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.51 | ||
| Fwd PE | 11.56 |
4.2 Price Multiples
- 66.25% of the companies in the same industry are more expensive than ABM, based on the Enterprise Value to EBITDA ratio.
- ABM's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. ABM is cheaper than 76.25% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 18.29 | ||
| EV/EBITDA | 9.99 |
4.3 Compensation for Growth
- The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
PEG (NY)0.8
PEG (5Y)1.89
EPS Next 2Y13.9%
EPS Next 3Y10%
5. Dividend
5.1 Amount
- ABM has a Yearly Dividend Yield of 2.58%.
- Compared to an average industry Dividend Yield of 0.83, ABM pays a better dividend. On top of this ABM pays more dividend than 87.50% of the companies listed in the same industry.
- ABM's Dividend Yield is a higher than the S&P500 average which is at 1.82.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.58% |
5.2 History
- On average, the dividend of ABM grows each year by 7.71%, which is quite nice.
- ABM has been paying a dividend for at least 10 years, so it has a reliable track record.
- ABM has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)7.71%
Div Incr Years4
Div Non Decr Years4
5.3 Sustainability
- 40.39% of the earnings are spent on dividend by ABM. This is a bit on the high side, but may be sustainable.
- The dividend of ABM is growing, but earnings are growing more, so the dividend growth is sustainable.
DP40.39%
EPS Next 2Y13.9%
EPS Next 3Y10%
ABM INDUSTRIES INC / ABM FAQ
What is the ChartMill fundamental rating of ABM INDUSTRIES INC (ABM) stock?
ChartMill assigns a fundamental rating of 5 / 10 to ABM.
What is the valuation status of ABM INDUSTRIES INC (ABM) stock?
ChartMill assigns a valuation rating of 6 / 10 to ABM INDUSTRIES INC (ABM). This can be considered as Fairly Valued.
How profitable is ABM INDUSTRIES INC (ABM) stock?
ABM INDUSTRIES INC (ABM) has a profitability rating of 4 / 10.
How financially healthy is ABM INDUSTRIES INC?
The financial health rating of ABM INDUSTRIES INC (ABM) is 4 / 10.
Is the dividend of ABM INDUSTRIES INC sustainable?
The dividend rating of ABM INDUSTRIES INC (ABM) is 7 / 10 and the dividend payout ratio is 40.39%.