ALLISON TRANSMISSION HOLDING (ALSN) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:ALSN - US01973R1014 - Common Stock
109.57 USD
-1.46 (-1.31%)
109.57 USD
0 (0%)
ALSN gets a fundamental rating of 7 out of 10. The analysis compared the fundamentals against 132 industry peers in the Machinery industry. ALSN has outstanding health and profitabily ratings, belonging to the best of the industry. This is a solid base for any company. ALSN may be a bit undervalued, certainly considering the very reasonable score on growth These ratings could make ALSN a good candidate for value and quality investing.
1. Profitability
1.1 Basic Checks
- In the past year ALSN was profitable.
- In the past year ALSN had a positive cash flow from operations.
- ALSN had positive earnings in each of the past 5 years.
- Each year in the past 5 years ALSN had a positive operating cash flow.
1.2 Ratios
- The Return On Assets of ALSN (12.67%) is better than 90.15% of its industry peers.
- The Return On Equity of ALSN (37.97%) is better than 96.21% of its industry peers.
- ALSN's Return On Invested Capital of 15.60% is amongst the best of the industry. ALSN outperforms 89.39% of its industry peers.
- ALSN had an Average Return On Invested Capital over the past 3 years of 16.17%. This is significantly above the industry average of 10.24%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 12.67% | ||
| ROE | 37.97% | ||
| ROIC | 15.6% |
ROA(3y)12.82%
ROA(5y)11.01%
ROE(3y)53.2%
ROE(5y)53.78%
ROIC(3y)16.17%
ROIC(5y)14.56%
1.3 Margins
- ALSN has a Profit Margin of 22.78%. This is amongst the best in the industry. ALSN outperforms 98.48% of its industry peers.
- ALSN's Profit Margin has been stable in the last couple of years.
- With an excellent Operating Margin value of 31.70%, ALSN belongs to the best of the industry, outperforming 100.00% of the companies in the same industry.
- In the last couple of years the Operating Margin of ALSN has remained more or less at the same level.
- With an excellent Gross Margin value of 48.29%, ALSN belongs to the best of the industry, outperforming 90.15% of the companies in the same industry.
- In the last couple of years the Gross Margin of ALSN has declined.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 31.7% | ||
| PM (TTM) | 22.78% | ||
| GM | 48.29% |
OM growth 3Y3.47%
OM growth 5Y-1.48%
PM growth 3Y7.2%
PM growth 5Y0.25%
GM growth 3Y-0.12%
GM growth 5Y-1.71%
2. Health
2.1 Basic Checks
- The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so ALSN is still creating some value.
- Compared to 1 year ago, ALSN has less shares outstanding
- The number of shares outstanding for ALSN has been reduced compared to 5 years ago.
- The debt/assets ratio for ALSN has been reduced compared to a year ago.
2.2 Solvency
- ALSN has an Altman-Z score of 2.90. This is not the best score and indicates that ALSN is in the grey zone with still only limited risk for bankruptcy at the moment.
- ALSN's Altman-Z score of 2.90 is in line compared to the rest of the industry. ALSN outperforms 46.97% of its industry peers.
- ALSN has a debt to FCF ratio of 3.82. This is a good value and a sign of high solvency as ALSN would need 3.82 years to pay back of all of its debts.
- Looking at the Debt to FCF ratio, with a value of 3.82, ALSN is in the better half of the industry, outperforming 62.12% of the companies in the same industry.
- ALSN has a Debt/Equity ratio of 1.30. This is a high value indicating a heavy dependency on external financing.
- With a Debt to Equity ratio value of 1.30, ALSN is not doing good in the industry: 81.82% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.3 | ||
| Debt/FCF | 3.82 | ||
| Altman-Z | 2.9 |
ROIC/WACC1.63
WACC9.55%
2.3 Liquidity
- ALSN has a Current Ratio of 3.82. This indicates that ALSN is financially healthy and has no problem in meeting its short term obligations.
- ALSN's Current ratio of 3.82 is amongst the best of the industry. ALSN outperforms 87.88% of its industry peers.
- ALSN has a Quick Ratio of 3.06. This indicates that ALSN is financially healthy and has no problem in meeting its short term obligations.
- ALSN has a Quick ratio of 3.06. This is amongst the best in the industry. ALSN outperforms 89.39% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 3.82 | ||
| Quick Ratio | 3.06 |
3. Growth
3.1 Past
- The earnings per share for ALSN have decreased by -0.61% in the last year.
- Measured over the past years, ALSN shows a quite strong growth in Earnings Per Share. The EPS has been growing by 11.10% on average per year.
- The Revenue has decreased by -4.21% in the past year.
- The Revenue has been growing slightly by 3.63% on average over the past years.
EPS 1Y (TTM)-0.61%
EPS 3Y26.35%
EPS 5Y11.1%
EPS Q2Q%-28.19%
Revenue 1Y (TTM)-4.21%
Revenue growth 3Y10.32%
Revenue growth 5Y3.63%
Sales Q2Q%-15.9%
3.2 Future
- Based on estimates for the next years, ALSN will show a quite strong growth in Earnings Per Share. The EPS will grow by 14.03% on average per year.
- ALSN is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 14.49% yearly.
EPS Next Y-6.56%
EPS Next 2Y0.02%
EPS Next 3Y6.41%
EPS Next 5Y14.03%
Revenue Next Year-6.83%
Revenue Next 2Y-3.36%
Revenue Next 3Y0.63%
Revenue Next 5Y14.49%
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 accelerating.
- The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
- The Price/Earnings ratio is 13.43, which indicates a correct valuation of ALSN.
- ALSN's Price/Earnings ratio is rather cheap when compared to the industry. ALSN is cheaper than 93.18% of the companies in the same industry.
- The average S&P500 Price/Earnings ratio is at 27.30. ALSN is valued rather cheaply when compared to this.
- The Price/Forward Earnings ratio is 13.18, which indicates a correct valuation of ALSN.
- 90.91% of the companies in the same industry are more expensive than ALSN, based on the Price/Forward Earnings ratio.
- Compared to an average S&P500 Price/Forward Earnings ratio of 24.32, ALSN is valued a bit cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.43 | ||
| Fwd PE | 13.18 |
4.2 Price Multiples
- 87.12% of the companies in the same industry are more expensive than ALSN, based on the Enterprise Value to EBITDA ratio.
- ALSN's Price/Free Cash Flow ratio is rather cheap when compared to the industry. ALSN is cheaper than 86.36% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 14.52 | ||
| EV/EBITDA | 9.8 |
4.3 Compensation for Growth
- The excellent profitability rating of ALSN may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)1.21
EPS Next 2Y0.02%
EPS Next 3Y6.41%
5. Dividend
5.1 Amount
- ALSN has a yearly dividend return of 0.97%, which is pretty low.
- Compared to an average industry Dividend Yield of 0.98, ALSN pays a bit more dividend than its industry peers.
- With a Dividend Yield of 0.97, ALSN pays less dividend than the S&P500 average, which is at 1.82.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.97% |
5.2 History
- On average, the dividend of ALSN grows each year by 10.94%, which is quite nice.
- ALSN has been paying a dividend for at least 10 years, so it has a reliable track record.
- ALSN has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)10.94%
Div Incr Years5
Div Non Decr Years12
5.3 Sustainability
- ALSN pays out 12.88% of its income as dividend. This is a sustainable payout ratio.
- ALSN's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP12.88%
EPS Next 2Y0.02%
EPS Next 3Y6.41%
ALLISON TRANSMISSION HOLDING / ALSN FAQ
Can you provide the ChartMill fundamental rating for ALLISON TRANSMISSION HOLDING?
ChartMill assigns a fundamental rating of 7 / 10 to ALSN.
What is the valuation status of ALLISON TRANSMISSION HOLDING (ALSN) stock?
ChartMill assigns a valuation rating of 7 / 10 to ALLISON TRANSMISSION HOLDING (ALSN). This can be considered as Undervalued.
What is the profitability of ALSN stock?
ALLISON TRANSMISSION HOLDING (ALSN) has a profitability rating of 8 / 10.
How financially healthy is ALLISON TRANSMISSION HOLDING?
The financial health rating of ALLISON TRANSMISSION HOLDING (ALSN) is 7 / 10.
Is the dividend of ALLISON TRANSMISSION HOLDING sustainable?
The dividend rating of ALLISON TRANSMISSION HOLDING (ALSN) is 6 / 10 and the dividend payout ratio is 12.88%.