ALAMO GROUP INC (ALG) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:ALG - US0113111076 - Common Stock
191.14 USD
-1.64 (-0.85%)
191.14 USD
0 (0%)
ALG gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 132 industry peers in the Machinery industry. ALG is in great health and has no worries on liquidiy or solvency at all, but the profibility rating is only average. ALG is valued correctly, but it does not seem to be growing.
1. Profitability
1.1 Basic Checks
- In the past year ALG was profitable.
- In the past year ALG had a positive cash flow from operations.
- ALG had positive earnings in each of the past 5 years.
- ALG had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
- ALG has a Return On Assets of 7.30%. This is in the better half of the industry: ALG outperforms 72.73% of its industry peers.
- ALG's Return On Equity of 10.27% is fine compared to the rest of the industry. ALG outperforms 62.12% of its industry peers.
- ALG has a better Return On Invested Capital (9.24%) than 67.42% of its industry peers.
- ALG had an Average Return On Invested Capital over the past 3 years of 11.11%. This is in line with the industry average of 10.24%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.3% | ||
| ROE | 10.27% | ||
| ROIC | 9.24% |
ROA(3y)8.48%
ROA(5y)7.45%
ROE(3y)12.99%
ROE(5y)11.88%
ROIC(3y)11.11%
ROIC(5y)9.98%
1.3 Margins
- ALG's Profit Margin of 7.20% is fine compared to the rest of the industry. ALG outperforms 62.12% of its industry peers.
- In the last couple of years the Profit Margin of ALG has grown nicely.
- ALG's Operating Margin of 10.12% is in line compared to the rest of the industry. ALG outperforms 56.06% of its industry peers.
- In the last couple of years the Operating Margin of ALG has grown nicely.
- ALG has a worse Gross Margin (25.05%) than 64.39% of its industry peers.
- In the last couple of years the Gross Margin of ALG has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 10.12% | ||
| PM (TTM) | 7.2% | ||
| GM | 25.05% |
OM growth 3Y4.92%
OM growth 5Y3.6%
PM growth 3Y5.8%
PM growth 5Y4.77%
GM growth 3Y0.34%
GM growth 5Y0.72%
2. Health
2.1 Basic Checks
- With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), ALG is creating some value.
- The number of shares outstanding for ALG has been increased compared to 1 year ago.
- The number of shares outstanding for ALG has been increased compared to 5 years ago.
- Compared to 1 year ago, ALG has an improved debt to assets ratio.
2.2 Solvency
- An Altman-Z score of 5.84 indicates that ALG is not in any danger for bankruptcy at the moment.
- ALG has a Altman-Z score of 5.84. This is amongst the best in the industry. ALG outperforms 81.82% of its industry peers.
- ALG has a debt to FCF ratio of 1.40. This is a very positive value and a sign of high solvency as it would only need 1.40 years to pay back of all of its debts.
- Looking at the Debt to FCF ratio, with a value of 1.40, ALG belongs to the top of the industry, outperforming 84.85% of the companies in the same industry.
- A Debt/Equity ratio of 0.17 indicates that ALG is not too dependend on debt financing.
- The Debt to Equity ratio of ALG (0.17) is better than 71.97% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.17 | ||
| Debt/FCF | 1.4 | ||
| Altman-Z | 5.84 |
ROIC/WACC0.94
WACC9.78%
2.3 Liquidity
- A Current Ratio of 4.43 indicates that ALG has no problem at all paying its short term obligations.
- With an excellent Current ratio value of 4.43, ALG belongs to the best of the industry, outperforming 90.91% of the companies in the same industry.
- ALG has a Quick Ratio of 2.72. This indicates that ALG is financially healthy and has no problem in meeting its short term obligations.
- ALG has a better Quick ratio (2.72) than 87.12% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 4.43 | ||
| Quick Ratio | 2.72 |
3. Growth
3.1 Past
- ALG shows a slight negative growth in Earnings Per Share. In the last year, the EPS has decreased by -2.92%.
- Measured over the past years, ALG shows a quite strong growth in Earnings Per Share. The EPS has been growing by 10.26% on average per year.
- ALG shows a decrease in Revenue. In the last year, the revenue decreased by -2.73%.
- The Revenue has been growing slightly by 7.79% on average over the past years.
EPS 1Y (TTM)-2.92%
EPS 3Y13.14%
EPS 5Y10.26%
EPS Q2Q%-7.89%
Revenue 1Y (TTM)-2.73%
Revenue growth 3Y6.87%
Revenue growth 5Y7.79%
Sales Q2Q%4.67%
3.2 Future
- The Earnings Per Share is expected to grow by 11.64% on average over the next years. This is quite good.
- Based on estimates for the next years, ALG will show a small growth in Revenue. The Revenue will grow by 2.26% on average per year.
EPS Next Y-1.64%
EPS Next 2Y9.94%
EPS Next 3Y11.64%
EPS Next 5YN/A
Revenue Next Year-0.42%
Revenue Next 2Y2.3%
Revenue Next 3Y2.26%
Revenue Next 5YN/A
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.
- The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
- With a Price/Earnings ratio of 19.83, ALG is valued on the expensive side.
- Compared to the rest of the industry, the Price/Earnings ratio of ALG indicates a somewhat cheap valuation: ALG is cheaper than 76.52% of the companies listed in the same industry.
- When comparing the Price/Earnings ratio of ALG to the average of the S&P500 Index (27.21), we can say ALG is valued slightly cheaper.
- With a Price/Forward Earnings ratio of 16.42, ALG is valued correctly.
- Compared to the rest of the industry, the Price/Forward Earnings ratio of ALG indicates a somewhat cheap valuation: ALG is cheaper than 78.79% of the companies listed in the same industry.
- ALG is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 25.98, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.83 | ||
| Fwd PE | 16.42 |
4.2 Price Multiples
- ALG's Enterprise Value to EBITDA ratio is rather cheap when compared to the industry. ALG is cheaper than 81.06% of the companies in the same industry.
- Based on the Price/Free Cash Flow ratio, ALG is valued cheaply inside the industry as 84.85% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 15.45 | ||
| EV/EBITDA | 10.45 |
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)1.93
EPS Next 2Y9.94%
EPS Next 3Y11.64%
5. Dividend
5.1 Amount
- ALG has a yearly dividend return of 0.71%, which is pretty low.
- ALG's Dividend Yield is comparable with the industry average which is at 1.01.
- Compared to an average S&P500 Dividend Yield of 1.81, ALG's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.71% |
5.2 History
- The dividend of ALG is nicely growing with an annual growth rate of 16.84%!
- 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)16.84%
Div Incr Years10
Div Non Decr Years24
5.3 Sustainability
- 11.96% of the earnings are spent on dividend by ALG. This is a low number and sustainable payout ratio.
- The dividend of ALG is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP11.96%
EPS Next 2Y9.94%
EPS Next 3Y11.64%
ALAMO GROUP INC / ALG FAQ
What is the ChartMill fundamental rating of ALAMO GROUP INC (ALG) stock?
ChartMill assigns a fundamental rating of 6 / 10 to ALG.
What is the valuation status for ALG stock?
ChartMill assigns a valuation rating of 5 / 10 to ALAMO GROUP INC (ALG). This can be considered as Fairly Valued.
Can you provide the profitability details for ALAMO GROUP INC?
ALAMO GROUP INC (ALG) has a profitability rating of 6 / 10.
What is the financial health of ALAMO GROUP INC (ALG) stock?
The financial health rating of ALAMO GROUP INC (ALG) is 8 / 10.
Can you provide the dividend sustainability for ALG stock?
The dividend rating of ALAMO GROUP INC (ALG) is 5 / 10 and the dividend payout ratio is 11.96%.