AGX gets a fundamental rating of 7 out of 10. The analysis compared the fundamentals against 55 industry peers in the Construction & Engineering industry. AGX gets an excellent profitability rating and is at the same time showing great financial health properties. AGX is growing strongly while it is still valued neutral. This is a good combination! These ratings could make AGX a good candidate for growth and quality investing.

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1. Profitability

2. Health

3. Growth

4. Valuation

5. Dividend

1. Profitability

1.1 Basic Checks

In the past year AGX was profitable.
In the past year AGX had a positive cash flow from operations.
AGX had positive earnings in each of the past 5 years.
AGX had a positive operating cash flow in 4 of the past 5 years.

1.2 Ratios

AGX has a Return On Assets of 11.41%. This is in the better half of the industry: AGX outperforms 80.00% of its industry peers.
With a decent Return On Equity value of 28.57%, AGX is doing good in the industry, outperforming 78.18% of the companies in the same industry.
The Return On Invested Capital of AGX (19.85%) is better than 85.45% of its industry peers.
The Average Return On Invested Capital over the past 3 years for AGX is below the industry average of 15.97%.
The last Return On Invested Capital (19.85%) for AGX is above the 3 year average (12.29%), which is a sign of increasing profitability.

		Industry Rank	Sector Rank
ROA	11.41%
ROE	28.57%
ROIC	19.85%

ROA(3y)7.46%

ROA(5y)6.65%

ROE(3y)15.73%

ROE(5y)13.27%

ROIC(3y)12.3%

ROIC(5y)10.65%

1.3 Margins

AGX's Profit Margin of 13.11% is amongst the best of the industry. AGX outperforms 89.09% of its industry peers.
In the last couple of years the Profit Margin of AGX has grown nicely.
AGX has a Operating Margin of 13.08%. This is amongst the best in the industry. AGX outperforms 85.45% of its industry peers.
AGX's Operating Margin has been stable in the last couple of years.
AGX has a Gross Margin (19.20%) which is in line with its industry peers.
In the last couple of years the Gross Margin of AGX has declined.

		Industry Rank	Sector Rank
OM	13.08%
PM (TTM)	13.11%
GM	19.2%

OM growth 3Y-0.64%

OM growth 5YN/A

PM growth 3Y9.24%

PM growth 5YN/A

GM growth 3Y-6.25%

GM growth 5YN/A

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ROA

ROE

ROIC

Operating and Profit Margin

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2. Health

2.1 Basic Checks

AGX has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
AGX has more shares outstanding than it did 1 year ago.
AGX has less shares outstanding than it did 5 years ago.
AGX has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.

2.2 Solvency

An Altman-Z score of 6.83 indicates that AGX is not in any danger for bankruptcy at the moment.
AGX has a Altman-Z score of 6.83. This is amongst the best in the industry. AGX outperforms 87.27% of its industry peers.
AGX has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.

		Industry Rank	Sector Rank
Debt/Equity	0
Debt/FCF	0
Altman-Z	6.83

ROIC/WACC1.89

WACC10.49%

2.3 Liquidity

A Current Ratio of 1.61 indicates that AGX should not have too much problems paying its short term obligations.
Looking at the Current ratio, with a value of 1.61, AGX is in the better half of the industry, outperforming 80.00% of the companies in the same industry.
AGX has a Quick Ratio of 1.60. This is a normal value and indicates that AGX is financially healthy and should not expect problems in meeting its short term obligations.
Looking at the Quick ratio, with a value of 1.60, AGX belongs to the top of the industry, outperforming 83.64% of the companies in the same industry.

		Industry Rank	Sector Rank
Current Ratio	1.61
Quick Ratio	1.6

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WACC

Debt/Equity

How to determine the health of a company

Altman-Z score

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3. Growth

3.1 Past

AGX shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 77.62%, which is quite impressive.
Measured over the past years, AGX shows a very strong growth in Earnings Per Share. The EPS has been growing by 36.55% on average per year.
AGX shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 13.49%.
The Revenue has been growing by 29.61% on average over the past years. This is a very strong growth!

EPS 1Y (TTM)77.62%

EPS 3Y36.55%

EPS 5YN/A

EPS Q2Q%8.5%

Revenue 1Y (TTM)13.49%

Revenue growth 3Y19.72%

Revenue growth 5Y29.61%

Sales Q2Q%-2.28%

3.2 Future

Based on estimates for the next years, AGX will show a quite strong growth in Earnings Per Share. The EPS will grow by 16.80% on average per year.
AGX is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 13.97% yearly.

EPS Next Y36.6%

EPS Next 2Y25.64%

EPS Next 3Y25.7%

EPS Next 5Y16.8%

Revenue Next Year11.77%

Revenue Next 2Y19.63%

Revenue Next 3Y19.52%

Revenue Next 5Y13.97%

3.3 Evolution

The estimated forward EPS growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
Although the future Revenue growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.

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4. Valuation

4.1 Price/Earnings Ratio

The Price/Earnings ratio is 41.87, which means the current valuation is very expensive for AGX.
Compared to the rest of the industry, the Price/Earnings ratio of AGX is on the same level as its industry peers.
AGX is valuated rather expensively when we compare the Price/Earnings ratio to 28.39, which is the current average of the S&P500 Index.
The Price/Forward Earnings ratio is 36.86, which means the current valuation is very expensive for AGX.
AGX's Price/Forward Earnings is on the same level as the industry average.
AGX is valuated rather expensively when we compare the Price/Forward Earnings ratio to 25.72, which is the current average of the S&P500 Index.

		Industry Rank	Sector Rank
PE	41.87
Fwd PE	36.86

4.2 Price Multiples

Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of AGX is on the same level as its industry peers.
83.64% of the companies in the same industry are more expensive than AGX, based on the Price/Free Cash Flow ratio.

		Industry Rank	Sector Rank
P/FCF	17.35
EV/EBITDA	31.63

4.3 Compensation for Growth

The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
AGX has a very decent profitability rating, which may justify a higher PE ratio.
AGX's earnings are expected to grow with 25.70% in the coming years. This may justify a more expensive valuation.

PEG (NY)1.14

PEG (5Y)N/A

EPS Next 2Y25.64%

EPS Next 3Y25.7%

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5. Dividend

5.1 Amount

AGX has a yearly dividend return of 0.53%, which is pretty low.
AGX's Dividend Yield is rather good when compared to the industry average which is at 0.44. AGX pays more dividend than 89.09% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 1.82, AGX's dividend is way lower than the S&P500 average.

		Industry Rank	Sector Rank
Dividend Yield	0.53%

5.2 History

On average, the dividend of AGX grows each year by 6.33%, which is quite nice.
AGX has paid a dividend for at least 10 years, which is a reliable track record.
AGX has not decreased its dividend in the last 3 years.

Dividend Growth(5Y)6.33%

Div Incr Years3

Div Non Decr Years3

5.3 Sustainability

18.60% of the earnings are spent on dividend by AGX. This is a low number and sustainable payout ratio.
AGX's earnings are growing more than its dividend. This makes the dividend growth sustainable.

DP18.6%

EPS Next 2Y25.64%

EPS Next 3Y25.7%

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ARGAN INC / AGX FAQ

What is the fundamental rating for AGX stock?

ChartMill assigns a fundamental rating of 7 / 10 to AGX.

What is the valuation status for AGX stock?

ChartMill assigns a valuation rating of 4 / 10 to ARGAN INC (AGX). This can be considered as Fairly Valued.

How profitable is ARGAN INC (AGX) stock?

ARGAN INC (AGX) has a profitability rating of 7 / 10.

Can you provide the PE and PB ratios for AGX stock?

The Price/Earnings (PE) ratio for ARGAN INC (AGX) is 41.87 and the Price/Book (PB) ratio is 11.7.

What is the expected EPS growth for ARGAN INC (AGX) stock?

The Earnings per Share (EPS) of ARGAN INC (AGX) is expected to grow by 36.6% in the next year.