ALAMO GROUP INC (ALG) Stock Fundamental Analysis
NYSE:ALG - New York Stock Exchange, Inc. - US0113111076 - Common Stock - Currency: USD
Taking everything into account, ALG scores 6 out of 10 in our fundamental rating. ALG was compared to 128 industry peers in the Machinery industry. While ALG has a great health rating, its profitability is only average at the moment. ALG has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
ALG had positive earnings in the past year.
In the past year ALG had a positive cash flow from operations.
In the past 5 years ALG has always been profitable.
ALG had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
ALG has a Return On Assets of 8.06%. This is in the better half of the industry: ALG outperforms 73.60% of its industry peers.
Looking at the Return On Equity, with a value of 11.73%, ALG is in the better half of the industry, outperforming 61.60% of the companies in the same industry.
With a decent Return On Invested Capital value of 10.60%, ALG is doing good in the industry, outperforming 73.60% of the companies in the same industry.
ALG had an Average Return On Invested Capital over the past 3 years of 10.60%. This is in line with the industry average of 11.00%.
The 3 year average ROIC (10.60%) for ALG is below the current ROIC(10.60%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.06% | ||
| ROE | 11.73% | ||
| ROIC | 10.6% |
ROA(3y)8.03%
ROA(5y)6.89%
ROE(3y)12.98%
ROE(5y)11.82%
ROIC(3y)10.6%
ROIC(5y)9.26%
1.3 Margins
Looking at the Profit Margin, with a value of 7.19%, ALG is in line with its industry, outperforming 60.00% of the companies in the same industry.
ALG's Profit Margin has improved in the last couple of years.
ALG's Operating Margin of 10.55% is in line compared to the rest of the industry. ALG outperforms 56.00% of its industry peers.
ALG's Operating Margin has improved in the last couple of years.
ALG has a Gross Margin of 25.87%. This is in the lower half of the industry: ALG underperforms 61.60% of its industry peers.
ALG's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 10.55% | ||
| PM (TTM) | 7.19% | ||
| GM | 25.87% |
OM growth 3Y12.87%
OM growth 5Y3.17%
PM growth 3Y17.5%
PM growth 5Y2.04%
GM growth 3Y2.08%
GM growth 5Y1.13%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so ALG is destroying value.
Compared to 1 year ago, ALG has more shares outstanding
ALG has more shares outstanding than it did 5 years ago.
Compared to 1 year ago, ALG has an improved debt to assets ratio.
2.2 Solvency
ALG has an Altman-Z score of 5.87. This indicates that ALG is financially healthy and has little risk of bankruptcy at the moment.
ALG has a Altman-Z score of 5.87. This is amongst the best in the industry. ALG outperforms 80.80% of its industry peers.
ALG has a debt to FCF ratio of 1.44. This is a very positive value and a sign of high solvency as it would only need 1.44 years to pay back of all of its debts.
The Debt to FCF ratio of ALG (1.44) is better than 84.00% of its industry peers.
A Debt/Equity ratio of 0.21 indicates that ALG is not too dependend on debt financing.
Looking at the Debt to Equity ratio, with a value of 0.21, ALG is in the better half of the industry, outperforming 67.20% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.21 | ||
| Debt/FCF | 1.44 | ||
| Altman-Z | 5.87 |
ROIC/WACC0.99
WACC10.75%
2.3 Liquidity
ALG has a Current Ratio of 4.15. This indicates that ALG is financially healthy and has no problem in meeting its short term obligations.
ALG has a Current ratio of 4.15. This is amongst the best in the industry. ALG outperforms 88.00% of its industry peers.
ALG has a Quick Ratio of 2.39. This indicates that ALG is financially healthy and has no problem in meeting its short term obligations.
Looking at the Quick ratio, with a value of 2.39, ALG belongs to the top of the industry, outperforming 82.40% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 4.15 | ||
| Quick Ratio | 2.39 |
3. Growth
3.1 Past
The earnings per share for ALG have decreased strongly by -11.10% in the last year.
The Earnings Per Share has been growing by 13.92% on average over the past years. This is quite good.
The Revenue has been growing slightly by 0.12% in the past year.
The Revenue has been growing by 10.87% on average over the past years. This is quite good.
EPS 1Y (TTM)-11.1%
EPS 3Y31.29%
EPS 5Y13.92%
EPS Q2Q%-21.65%
Revenue 1Y (TTM)0.12%
Revenue growth 3Y13.24%
Revenue growth 5Y10.87%
Sales Q2Q%-4.37%
3.2 Future
Based on estimates for the next years, ALG will show a small growth in Earnings Per Share. The EPS will grow by 3.68% on average per year.
The Revenue is expected to grow by 0.58% on average over the next years.
EPS Next Y-15.07%
EPS Next 2Y-1.77%
EPS Next 3Y3.68%
EPS Next 5YN/A
Revenue Next Year-3.04%
Revenue Next 2Y-1.18%
Revenue Next 3Y0.58%
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 decreasing.
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
Based on the Price/Earnings ratio of 19.02, the valuation of ALG can be described as rather expensive.
Compared to the rest of the industry, the Price/Earnings ratio of ALG indicates a somewhat cheap valuation: ALG is cheaper than 71.20% of the companies listed in the same industry.
ALG is valuated rather cheaply when we compare the Price/Earnings ratio to 29.63, which is the current average of the S&P500 Index.
Based on the Price/Forward Earnings ratio of 17.23, the valuation of ALG can be described as rather expensive.
Compared to the rest of the industry, the Price/Forward Earnings ratio of ALG indicates a somewhat cheap valuation: ALG is cheaper than 73.60% of the companies listed in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 22.68. ALG is valued slightly cheaper when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.02 | ||
| Fwd PE | 17.23 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of ALG indicates a somewhat cheap valuation: ALG is cheaper than 75.20% of the companies listed in the same industry.
86.40% of the companies in the same industry are more expensive than ALG, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 14.68 | ||
| EV/EBITDA | 10.36 |
4.3 Compensation for Growth
ALG has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)1.37
EPS Next 2Y-1.77%
EPS Next 3Y3.68%
5. Dividend
5.1 Amount
ALG has a yearly dividend return of 0.64%, which is pretty low.
ALG's Dividend Yield is comparable with the industry average which is at 1.67.
With a Dividend Yield of 0.64, ALG pays less dividend than the S&P500 average, which is at 2.29.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.64% |
5.2 History
The dividend of ALG is nicely growing with an annual growth rate of 14.85%!
ALG has paid a dividend for at least 10 years, which is a reliable track record.
ALG has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)14.85%
Div Incr Years10
Div Non Decr Years24
5.3 Sustainability
ALG pays out 9.98% of its income as dividend. This is a sustainable payout ratio.
The dividend of ALG is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP9.98%
EPS Next 2Y-1.77%
EPS Next 3Y3.68%
188.9
+0.6 (+0.32%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryMachinery
Earnings (Last)
Earnings (Next)
Inst Owners94.93%
Inst Owner Change1.4%
Ins Owners1.02%
Ins Owner Change-0.83%
Market Cap2.28B
Analysts85
Price Target224.66 (18.93%)
Short Float %2.53%
Short Ratio3.05
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.64% |
Yearly Dividend0.88
Dividend Growth(5Y)14.85%
DP9.98%
Div Incr Years10
Div Non Decr Years24
Ex-Date
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-10.89%
Min EPS beat(2)-14.4%
Max EPS beat(2)-7.39%
EPS beat(4)1
Avg EPS beat(4)-4.96%
Min EPS beat(4)-14.4%
Max EPS beat(4)4.65%
EPS beat(8)4
Avg EPS beat(8)4.88%
EPS beat(12)6
Avg EPS beat(12)3.49%
EPS beat(16)8
Avg EPS beat(16)0.92%
Revenue beat(2)0
Avg Revenue beat(2)-2.77%
Min Revenue beat(2)-3.82%
Max Revenue beat(2)-1.72%
Revenue beat(4)1
Avg Revenue beat(4)-1.09%
Min Revenue beat(4)-3.82%
Max Revenue beat(4)2.61%
Revenue beat(8)5
Avg Revenue beat(8)1.09%
Revenue beat(12)8
Avg Revenue beat(12)1.22%
Revenue beat(16)10
Avg Revenue beat(16)1.66%
PT rev (1m)0%
PT rev (3m)3.28%
EPS NQ rev (1m)0%
EPS NQ rev (3m)0%
EPS NY rev (1m)0%
EPS NY rev (3m)0%
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 | 19.02 | ||
| Fwd PE | 17.23 | ||
| P/S | 1.37 | ||
| P/FCF | 14.68 | ||
| P/OCF | 12.33 | ||
| P/B | 2.24 | ||
| P/tB | 3.48 | ||
| EV/EBITDA | 10.36 |
EPS(TTM)9.93
EY5.26%
EPS(NY)10.96
Fwd EY5.8%
FCF(TTM)12.87
FCFY6.81%
OCF(TTM)15.32
OCFY8.11%
SpS137.71
BVpS84.39
TBVpS54.3
PEG (NY)N/A
PEG (5Y)1.37
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.06% | ||
| ROE | 11.73% | ||
| ROCE | 13.8% | ||
| ROIC | 10.6% | ||
| ROICexc | 11.91% | ||
| ROICexgc | 17.56% | ||
| OM | 10.55% | ||
| PM (TTM) | 7.19% | ||
| GM | 25.87% | ||
| FCFM | 9.34% |
ROA(3y)8.03%
ROA(5y)6.89%
ROE(3y)12.98%
ROE(5y)11.82%
ROIC(3y)10.6%
ROIC(5y)9.26%
ROICexc(3y)11.07%
ROICexc(5y)9.68%
ROICexgc(3y)17.12%
ROICexgc(5y)15.45%
ROCE(3y)13.8%
ROCE(5y)12.05%
ROICexcg growth 3Y12.64%
ROICexcg growth 5Y2.98%
ROICexc growth 3Y18.64%
ROICexc growth 5Y0.09%
OM growth 3Y12.87%
OM growth 5Y3.17%
PM growth 3Y17.5%
PM growth 5Y2.04%
GM growth 3Y2.08%
GM growth 5Y1.13%
F-Score6
Asset Turnover1.12
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.21 | ||
| Debt/FCF | 1.44 | ||
| Debt/EBITDA | 0.92 | ||
| Cap/Depr | 56.73% | ||
| Cap/Sales | 1.78% | ||
| Interest Coverage | 7.3 | ||
| Cash Conversion | 81.27% | ||
| Profit Quality | 129.98% | ||
| Current Ratio | 4.15 | ||
| Quick Ratio | 2.39 | ||
| Altman-Z | 5.87 |
F-Score6
WACC10.75%
ROIC/WACC0.99
Cap/Depr(3y)67.56%
Cap/Depr(5y)69.64%
Cap/Sales(3y)2.07%
Cap/Sales(5y)2.11%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-11.1%
EPS 3Y31.29%
EPS 5Y13.92%
EPS Q2Q%-21.65%
EPS Next Y-15.07%
EPS Next 2Y-1.77%
EPS Next 3Y3.68%
EPS Next 5YN/A
Revenue 1Y (TTM)0.12%
Revenue growth 3Y13.24%
Revenue growth 5Y10.87%
Sales Q2Q%-4.37%
Revenue Next Year-3.04%
Revenue Next 2Y-1.18%
Revenue Next 3Y0.58%
Revenue Next 5YN/A
EBIT growth 1Y-10.58%
EBIT growth 3Y27.82%
EBIT growth 5Y14.38%
EBIT Next Year10.46%
EBIT Next 3Y8.65%
EBIT Next 5YN/A
FCF growth 1Y416.01%
FCF growth 3Y-17.51%
FCF growth 5YN/A
OCF growth 1Y1340.24%
OCF growth 3Y-10.72%
OCF growth 5Y59.02%