ALAMO GROUP INC (ALG) Stock Fundamental Analysis
NYSE:ALG - New York Stock Exchange, Inc. - US0113111076 - Common Stock
We assign a fundamental rating of 6 out of 10 to ALG. ALG was compared to 131 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 not valued too expensively and it also shows a decent growth rate.
1. Profitability
1.1 Basic Checks
ALG had positive earnings in the past year.
ALG had a positive operating cash flow in the past year.
In the past 5 years ALG has always been profitable.
Each year in the past 5 years ALG had a positive operating cash flow.
1.2 Ratios
ALG has a Return On Assets of 8.06%. This is in the better half of the industry: ALG outperforms 74.02% of its industry peers.
With a decent Return On Equity value of 11.73%, ALG is doing good in the industry, outperforming 62.99% 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 72.44% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for ALG is in line with the industry average of 11.19%.
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
ALG's Profit Margin of 7.19% is in line compared to the rest of the industry. ALG outperforms 59.06% of its industry peers.
In the last couple of years the Profit Margin of ALG has grown nicely.
The Operating Margin of ALG (10.55%) is comparable to the rest of the industry.
In the last couple of years the Operating Margin of ALG has grown nicely.
Looking at the Gross Margin, with a value of 25.87%, ALG is doing worse than 61.42% of the companies in the same industry.
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 | 10.55% | ||
| 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
ALG has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some 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
An Altman-Z score of 5.78 indicates that ALG is not in any danger for bankruptcy at the moment.
ALG's Altman-Z score of 5.78 is fine compared to the rest of the industry. ALG outperforms 77.17% of its industry peers.
The Debt to FCF ratio of ALG is 1.44, which is an excellent value as it means it would take ALG, only 1.44 years of fcf income to pay off all of its debts.
ALG has a better Debt to FCF ratio (1.44) than 87.40% of its industry peers.
ALG has a Debt/Equity ratio of 0.21. This is a healthy value indicating a solid balance between debt and equity.
ALG has a Debt to Equity ratio of 0.21. This is in the better half of the industry: ALG outperforms 70.08% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.21 | ||
| Debt/FCF | 1.44 | ||
| Altman-Z | 5.78 |
ROIC/WACC1.08
WACC9.82%
2.3 Liquidity
A Current Ratio of 4.15 indicates that ALG has no problem at all paying its short term obligations.
The Current ratio of ALG (4.15) is better than 87.40% 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.
The Quick ratio of ALG (2.39) is better than 83.46% of its industry peers.
| 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.
Measured over the past years, ALG shows a quite strong growth in Earnings Per Share. The EPS has been growing by 13.92% on average per year.
ALG shows a small growth in Revenue. In the last year, the Revenue has grown by 0.12%.
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
The Earnings Per Share is expected to grow by 3.68% on average over the next years.
ALG is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 0.58% yearly.
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
The EPS growth rate is decreasing: in the next years the growth will be less 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 18.64, ALG is valued on the expensive side.
Based on the Price/Earnings ratio, ALG is valued a bit cheaper than the industry average as 70.87% of the companies are valued more expensively.
When comparing the Price/Earnings ratio of ALG to the average of the S&P500 Index (28.29), we can say ALG is valued slightly cheaper.
Based on the Price/Forward Earnings ratio of 16.89, the valuation of ALG can be described as correct.
ALG's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. ALG is cheaper than 72.44% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of ALG to the average of the S&P500 Index (24.44), we can say ALG is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 18.64 | ||
| Fwd PE | 16.89 |
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 77.17% of the companies listed in the same industry.
ALG's Price/Free Cash Flow ratio is rather cheap when compared to the industry. ALG is cheaper than 88.19% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 14.39 | ||
| EV/EBITDA | 10.04 |
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)1.34
EPS Next 2Y-1.77%
EPS Next 3Y3.68%
5. Dividend
5.1 Amount
With a yearly dividend of 0.66%, ALG is not a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 1.65, ALG has a dividend in line with its industry peers.
Compared to an average S&P500 Dividend Yield of 2.28, ALG's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.66% |
5.2 History
The dividend of ALG is nicely growing with an annual growth rate of 14.85%!
ALG has been paying a dividend for at least 10 years, so it has a reliable track record.
ALG has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
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.
ALG's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP9.98%
EPS Next 2Y-1.77%
EPS Next 3Y3.68%
ALAMO GROUP INC
NYSE:ALG (1/21/2025, 8:04:00 PM)
After market: 185.13 0 (0%)185.13
+2.78 (+1.52%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryMachinery
Earnings (Last)
Earnings (Next)
Inst Owners94.93%
Inst Owner Change-0.3%
Ins Owners1.02%
Ins Owner Change-0.83%
Market Cap2.23B
Analysts85
Price Target224.66 (21.35%)
Short Float %2.8%
Short Ratio3.25
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.66% |
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)2.2%
PT rev (3m)1.73%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-27.93%
EPS NY rev (1m)0%
EPS NY rev (3m)-5.4%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-11.95%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-1.08%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 18.64 | ||
| Fwd PE | 16.89 | ||
| P/S | 1.34 | ||
| P/FCF | 14.39 | ||
| P/OCF | 12.08 | ||
| P/B | 2.19 | ||
| P/tB | 3.41 | ||
| EV/EBITDA | 10.04 |
EPS(TTM)9.93
EY5.36%
EPS(NY)10.96
Fwd EY5.92%
FCF(TTM)12.87
FCFY6.95%
OCF(TTM)15.32
OCFY8.28%
SpS137.71
BVpS84.39
TBVpS54.3
PEG (NY)N/A
PEG (5Y)1.34
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 | 5.78 |
F-Score6
WACC9.82%
ROIC/WACC1.08
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%