ALLETE INC (ALE) Stock Fundamental Analysis
USA - NYSE:ALE - US0185223007 - Common Stock
67.5 USD
+0.09 (+0.13%)
67.5 USD
0 (0%)
We assign a fundamental rating of 3 out of 10 to ALE. ALE was compared to 46 industry peers in the Electric Utilities industry. ALE may be in some trouble as it scores bad on both profitability and health. ALE has a expensive valuation and it also scores bad on growth. ALE also has an excellent dividend rating.
1. Profitability
1.1 Basic Checks
ALE had positive earnings in the past year.
ALE had a positive operating cash flow in the past year.
ALE had positive earnings in each of the past 5 years.
ALE had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
With a Return On Assets value of 2.32%, ALE is not doing good in the industry: 79.17% of the companies in the same industry are doing better.
ALE's Return On Equity of 5.81% is on the low side compared to the rest of the industry. ALE is outperformed by 81.25% of its industry peers.
With a Return On Invested Capital value of 1.88%, ALE is not doing good in the industry: 89.58% of the companies in the same industry are doing better.
ALE had an Average Return On Invested Capital over the past 3 years of 2.33%. This is below the industry average of 5.00%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.32% | ||
| ROE | 5.81% | ||
| ROIC | 1.88% |
ROA(3y)3.04%
ROA(5y)2.9%
ROE(3y)7.37%
ROE(5y)7.27%
ROIC(3y)2.33%
ROIC(5y)2.36%
1.3 Margins
ALE's Profit Margin of 11.04% is on the low side compared to the rest of the industry. ALE is outperformed by 68.75% of its industry peers.
In the last couple of years the Profit Margin of ALE has declined.
Looking at the Operating Margin, with a value of 9.24%, ALE is doing worse than 87.50% of the companies in the same industry.
In the last couple of years the Operating Margin of ALE has declined.
Looking at the Gross Margin, with a value of 93.25%, ALE belongs to the top of the industry, outperforming 97.92% of the companies in the same industry.
In the last couple of years the Gross Margin of ALE has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 9.24% | ||
| PM (TTM) | 11.04% | ||
| GM | 93.25% |
OM growth 3Y-0.62%
OM growth 5Y-6.31%
PM growth 3Y-0.57%
PM growth 5Y-4.77%
GM growth 3Y-1.28%
GM growth 5Y-0.42%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), ALE is destroying value.
The number of shares outstanding for ALE has been increased compared to 1 year ago.
The number of shares outstanding for ALE has been increased compared to 5 years ago.
Compared to 1 year ago, ALE has an improved debt to assets ratio.
2.2 Solvency
Based on the Altman-Z score of 1.03, we must say that ALE is in the distress zone and has some risk of bankruptcy.
Looking at the Altman-Z score, with a value of 1.03, ALE is in the better half of the industry, outperforming 60.42% of the companies in the same industry.
ALE has a Debt/Equity ratio of 0.74. This is a neutral value indicating ALE is somewhat dependend on debt financing.
With a decent Debt to Equity ratio value of 0.74, ALE is doing good in the industry, outperforming 66.67% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.74 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 1.03 |
ROIC/WACC0.26
WACC7.22%
2.3 Liquidity
ALE has a Current Ratio of 1.17. This is a normal value and indicates that ALE is financially healthy and should not expect problems in meeting its short term obligations.
The Current ratio of ALE (1.17) is better than 81.25% of its industry peers.
A Quick Ratio of 0.73 indicates that ALE may have some problems paying its short term obligations.
With a Quick ratio value of 0.73, ALE perfoms like the industry average, outperforming 54.17% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.17 | ||
| Quick Ratio | 0.73 |
3. Growth
3.1 Past
The earnings per share for ALE have decreased by -8.65% in the last year.
ALE shows a decrease in Earnings Per Share. Measured over the last years, the EPS has been decreasing by -2.89% yearly.
ALE shows a decrease in Revenue. In the last year, the revenue decreased by -4.30%.
The Revenue has been growing slightly by 4.28% on average over the past years.
EPS 1Y (TTM)-8.65%
EPS 3Y-1.36%
EPS 5Y-2.89%
EPS Q2Q%-41.03%
Revenue 1Y (TTM)-4.3%
Revenue growth 3Y2.53%
Revenue growth 5Y4.28%
Sales Q2Q%-7.91%
3.2 Future
Based on estimates for the next years, ALE will show a quite strong growth in Earnings Per Share. The EPS will grow by 11.96% on average per year.
Based on estimates for the next years, ALE will show a small growth in Revenue. The Revenue will grow by 5.14% on average per year.
EPS Next Y18.92%
EPS Next 2Y14.02%
EPS Next 3Y15.1%
EPS Next 5Y11.96%
Revenue Next Year-1.51%
Revenue Next 2Y2%
Revenue Next 3Y3.82%
Revenue Next 5Y5.14%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
The Revenue growth rate is stable: in the next years the growth will be about the same than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 23.68, which indicates a rather expensive current valuation of ALE.
Based on the Price/Earnings ratio, ALE is valued more expensive than 85.42% of the companies in the same industry.
The average S&P500 Price/Earnings ratio is at 25.89. ALE is around the same levels.
ALE is valuated correctly with a Price/Forward Earnings ratio of 16.75.
ALE's Price/Forward Earnings ratio is in line with the industry average.
ALE's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 34.59.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 23.68 | ||
| Fwd PE | 16.75 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, ALE is valued a bit more expensive than the industry average as 75.00% of the companies are valued more cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 14.12 |
4.3 Compensation for Growth
ALE's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
ALE's earnings are expected to grow with 15.10% in the coming years. This may justify a more expensive valuation.
PEG (NY)1.25
PEG (5Y)N/A
EPS Next 2Y14.02%
EPS Next 3Y15.1%
5. Dividend
5.1 Amount
ALE has a Yearly Dividend Yield of 4.33%, which is a nice return.
ALE's Dividend Yield is a higher than the industry average which is at 3.77.
Compared to an average S&P500 Dividend Yield of 2.44, ALE pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.33% |
5.2 History
The dividend of ALE has a limited annual growth rate of 3.68%.
ALE has paid a dividend for at least 10 years, which is a reliable track record.
ALE has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)3.68%
Div Incr Years14
Div Non Decr Years19
5.3 Sustainability
101.27% of the earnings are spent on dividend by ALE. This is not a sustainable payout ratio.
ALE's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP101.27%
EPS Next 2Y14.02%
EPS Next 3Y15.1%
67.5
+0.09 (+0.13%)
Chartmill FA Rating
GICS SectorUtilities
GICS IndustryGroupUtilities
GICS IndustryElectric Utilities
Earnings (Last)
Earnings (Next)
Inst Owners76.96%
Inst Owner Change-3.05%
Ins Owners0.27%
Ins Owner Change5.01%
Market Cap3.92B
Revenue(TTM)1.50B
Net Income(TTM)165.70M
Analysts80
Price Target70.67 (4.7%)
Short Float %1.51%
Short Ratio1.28
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.33% |
Yearly Dividend2.82
Dividend Growth(5Y)3.68%
DP101.27%
Div Incr Years14
Div Non Decr Years19
Ex-Date
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-44.8%
Min EPS beat(2)-52.56%
Max EPS beat(2)-37.05%
EPS beat(4)0
Avg EPS beat(4)-30%
Min EPS beat(4)-52.56%
Max EPS beat(4)-7.65%
EPS beat(8)0
Avg EPS beat(8)-24.56%
EPS beat(12)2
Avg EPS beat(12)-8.06%
EPS beat(16)4
Avg EPS beat(16)-5.82%
Revenue beat(2)0
Avg Revenue beat(2)-15.37%
Min Revenue beat(2)-16.12%
Max Revenue beat(2)-14.63%
Revenue beat(4)0
Avg Revenue beat(4)-14.17%
Min Revenue beat(4)-16.12%
Max Revenue beat(4)-12.76%
Revenue beat(8)1
Avg Revenue beat(8)-14.57%
Revenue beat(12)4
Avg Revenue beat(12)-4.84%
Revenue beat(16)8
Avg Revenue beat(16)-0.83%
PT rev (1m)0%
PT rev (3m)0.83%
EPS NQ rev (1m)0%
EPS NQ rev (3m)0.94%
EPS NY rev (1m)0%
EPS NY rev (3m)-5.03%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0%
Revenue NY rev (1m)0%
Revenue NY rev (3m)0%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 23.68 | ||
| Fwd PE | 16.75 | ||
| P/S | 2.61 | ||
| P/FCF | N/A | ||
| P/OCF | 11.43 | ||
| P/B | 1.37 | ||
| P/tB | 1.45 | ||
| EV/EBITDA | 14.12 |
EPS(TTM)2.85
EY4.22%
EPS(NY)4.03
Fwd EY5.97%
FCF(TTM)-5.55
FCFYN/A
OCF(TTM)5.91
OCFY8.75%
SpS25.85
BVpS49.12
TBVpS46.45
PEG (NY)1.25
PEG (5Y)N/A
Graham Number56.13
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.32% | ||
| ROE | 5.81% | ||
| ROCE | 2.06% | ||
| ROIC | 1.88% | ||
| ROICexc | 1.9% | ||
| ROICexgc | 1.95% | ||
| OM | 9.24% | ||
| PM (TTM) | 11.04% | ||
| GM | 93.25% | ||
| FCFM | N/A |
ROA(3y)3.04%
ROA(5y)2.9%
ROE(3y)7.37%
ROE(5y)7.27%
ROIC(3y)2.33%
ROIC(5y)2.36%
ROICexc(3y)2.34%
ROICexc(5y)2.38%
ROICexgc(3y)2.4%
ROICexgc(5y)2.41%
ROCE(3y)2.55%
ROCE(5y)2.58%
ROICexgc growth 3Y0.06%
ROICexgc growth 5Y-6.66%
ROICexc growth 3Y-0.77%
ROICexc growth 5Y-7.11%
OM growth 3Y-0.62%
OM growth 5Y-6.31%
PM growth 3Y-0.57%
PM growth 5Y-4.77%
GM growth 3Y-1.28%
GM growth 5Y-0.42%
F-Score4
Asset Turnover0.21
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.74 | ||
| Debt/FCF | N/A | ||
| Debt/EBITDA | 4.88 | ||
| Cap/Depr | 228.02% | ||
| Cap/Sales | 44.32% | ||
| Interest Coverage | 1.74 | ||
| Cash Conversion | 79.67% | ||
| Profit Quality | N/A | ||
| Current Ratio | 1.17 | ||
| Quick Ratio | 0.73 | ||
| Altman-Z | 1.03 |
F-Score4
WACC7.22%
ROIC/WACC0.26
Cap/Depr(3y)106.82%
Cap/Depr(5y)166.23%
Cap/Sales(3y)17.22%
Cap/Sales(5y)29.28%
Profit Quality(3y)61.51%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-8.65%
EPS 3Y-1.36%
EPS 5Y-2.89%
EPS Q2Q%-41.03%
EPS Next Y18.92%
EPS Next 2Y14.02%
EPS Next 3Y15.1%
EPS Next 5Y11.96%
Revenue 1Y (TTM)-4.3%
Revenue growth 3Y2.53%
Revenue growth 5Y4.28%
Sales Q2Q%-7.91%
Revenue Next Year-1.51%
Revenue Next 2Y2%
Revenue Next 3Y3.82%
Revenue Next 5Y5.14%
EBIT growth 1Y-15.99%
EBIT growth 3Y1.9%
EBIT growth 5Y-2.29%
EBIT Next Year158.47%
EBIT Next 3Y53.28%
EBIT Next 5Y37.33%
FCF growth 1Y-179.04%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y-48.07%
OCF growth 3Y20.16%
OCF growth 5Y12.87%
ALLETE INC / ALE FAQ
What is the fundamental rating for ALE stock?
ChartMill assigns a fundamental rating of 3 / 10 to ALE.
What is the valuation status for ALE stock?
ChartMill assigns a valuation rating of 2 / 10 to ALLETE INC (ALE). This can be considered as Overvalued.
What is the profitability of ALE stock?
ALLETE INC (ALE) has a profitability rating of 3 / 10.
What are the PE and PB ratios of ALLETE INC (ALE) stock?
The Price/Earnings (PE) ratio for ALLETE INC (ALE) is 23.68 and the Price/Book (PB) ratio is 1.37.
How sustainable is the dividend of ALLETE INC (ALE) stock?
The dividend rating of ALLETE INC (ALE) is 7 / 10 and the dividend payout ratio is 101.27%.