ALLISON TRANSMISSION HOLDING (ALSN) Stock Fundamental Analysis
NYSE:ALSN - New York Stock Exchange, Inc. - US01973R1014 - Common Stock - Currency: USD
Overall ALSN gets a fundamental rating of 7 out of 10. We evaluated ALSN against 128 industry peers in the Machinery industry. While ALSN belongs to the best of the industry regarding profitability, there are some minor concerns on its financial health. A decent growth rate in combination with a cheap valuation! Better keep an eye on ALSN. This makes ALSN very considerable for value 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.
In the past 5 years ALSN has always been profitable.
In the past 5 years ALSN always reported a positive cash flow from operatings.
1.2 Ratios
With an excellent Return On Assets value of 13.70%, ALSN belongs to the best of the industry, outperforming 90.40% of the companies in the same industry.
With an excellent Return On Equity value of 44.28%, ALSN belongs to the best of the industry, outperforming 95.20% of the companies in the same industry.
ALSN has a Return On Invested Capital of 16.73%. This is amongst the best in the industry. ALSN outperforms 88.80% 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 11.00%.
The 3 year average ROIC (16.17%) for ALSN is below the current ROIC(16.73%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 13.7% | ||
| ROE | 44.28% | ||
| ROIC | 16.73% |
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
Looking at the Profit Margin, with a value of 22.67%, ALSN belongs to the top of the industry, outperforming 97.60% of the companies in the same industry.
In the last couple of years the Profit Margin of ALSN has remained more or less at the same level.
ALSN has a better Operating Margin (30.76%) than 100.00% of its industry peers.
In the last couple of years the Operating Margin of ALSN has remained more or less at the same level.
ALSN has a Gross Margin of 47.41%. This is amongst the best in the industry. ALSN outperforms 88.80% of its industry peers.
ALSN's Gross Margin has declined in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 30.76% | ||
| PM (TTM) | 22.67% | ||
| GM | 47.41% |
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.
Compared to 1 year ago, ALSN has an improved debt to assets ratio.
2.2 Solvency
ALSN has an Altman-Z score of 2.83. 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.
Looking at the Altman-Z score, with a value of 2.83, ALSN is in line with its industry, outperforming 50.40% of the companies in the same industry.
The Debt to FCF ratio of ALSN is 3.65, which is a good value as it means it would take ALSN, 3.65 years of fcf income to pay off all of its debts.
ALSN's Debt to FCF ratio of 3.65 is in line compared to the rest of the industry. ALSN outperforms 60.00% of its industry peers.
ALSN has a Debt/Equity ratio of 1.45. This is a high value indicating a heavy dependency on external financing.
ALSN has a Debt to Equity ratio of 1.45. This is amonst the worse of the industry: ALSN underperforms 87.20% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.45 | ||
| Debt/FCF | 3.65 | ||
| Altman-Z | 2.83 |
ROIC/WACC1.63
WACC10.29%
2.3 Liquidity
ALSN has a Current Ratio of 3.04. This indicates that ALSN is financially healthy and has no problem in meeting its short term obligations.
With a decent Current ratio value of 3.04, ALSN is doing good in the industry, outperforming 76.00% of the companies in the same industry.
A Quick Ratio of 2.42 indicates that ALSN has no problem at all paying its short term obligations.
ALSN has a Quick ratio of 2.42. This is amongst the best in the industry. ALSN outperforms 83.20% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 3.04 | ||
| Quick Ratio | 2.42 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 11.69% over the past 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 been growing slightly by 6.26% in the past year.
The Revenue has been growing slightly by 3.63% on average over the past years.
EPS 1Y (TTM)11.69%
EPS 3Y26.35%
EPS 5Y11.1%
EPS Q2Q%5.24%
Revenue 1Y (TTM)6.26%
Revenue growth 3Y10.32%
Revenue growth 5Y3.63%
Sales Q2Q%2.71%
3.2 Future
Based on estimates for the next years, ALSN will show a small growth in Earnings Per Share. The EPS will grow by 7.43% on average per year.
The Revenue is expected to grow by 3.49% on average over the next years.
EPS Next Y9.71%
EPS Next 2Y12.28%
EPS Next 3Y16.55%
EPS Next 5Y7.43%
Revenue Next Year3.35%
Revenue Next 2Y4.54%
Revenue Next 3Y1.99%
Revenue Next 5Y3.49%
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 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 12.11, which indicates a correct valuation of ALSN.
Based on the Price/Earnings ratio, ALSN is valued cheaper than 85.60% of the companies in the same industry.
ALSN's Price/Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 29.63.
Based on the Price/Forward Earnings ratio of 11.04, the valuation of ALSN can be described as reasonable.
ALSN's Price/Forward Earnings ratio is rather cheap when compared to the industry. ALSN is cheaper than 92.00% of the companies in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 22.68, ALSN is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.11 | ||
| Fwd PE | 11.04 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, ALSN is valued a bit cheaper than 80.00% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, ALSN is valued cheaply inside the industry as 90.40% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 13.25 | ||
| EV/EBITDA | 9.42 |
4.3 Compensation for Growth
The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
The excellent profitability rating of ALSN may justify a higher PE ratio.
ALSN's earnings are expected to grow with 16.55% in the coming years. This may justify a more expensive valuation.
PEG (NY)1.25
PEG (5Y)1.09
EPS Next 2Y12.28%
EPS Next 3Y16.55%
5. Dividend
5.1 Amount
With a yearly dividend of 0.96%, ALSN is not a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 1.67, ALSN pays a bit more dividend than its industry peers.
With a Dividend Yield of 0.96, ALSN pays less dividend than the S&P500 average, which is at 2.29.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.96% |
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 their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)10.94%
Div Incr Years5
Div Non Decr Years12
5.3 Sustainability
11.90% of the earnings are spent on dividend by ALSN. This is a low number and sustainable payout ratio.
ALSN's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP11.9%
EPS Next 2Y12.28%
EPS Next 3Y16.55%
100.67
-1.69 (-1.65%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryMachinery
Earnings (Last)
Earnings (Next)
Inst Owners100.59%
Inst Owner Change1.04%
Ins Owners0.45%
Ins Owner Change-0.25%
Market Cap8.72B
Analysts72
Price Target108.99 (8.26%)
Short Float %2.06%
Short Ratio2.95
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.96% |
Yearly Dividend1
Dividend Growth(5Y)10.94%
DP11.9%
Div Incr Years5
Div Non Decr Years12
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)6.8%
Min EPS beat(2)3.3%
Max EPS beat(2)10.3%
EPS beat(4)3
Avg EPS beat(4)3.8%
Min EPS beat(4)-1.53%
Max EPS beat(4)10.3%
EPS beat(8)6
Avg EPS beat(8)9.85%
EPS beat(12)9
Avg EPS beat(12)9.13%
EPS beat(16)12
Avg EPS beat(16)9.27%
Revenue beat(2)1
Avg Revenue beat(2)0.42%
Min Revenue beat(2)-1.42%
Max Revenue beat(2)2.26%
Revenue beat(4)3
Avg Revenue beat(4)0.26%
Min Revenue beat(4)-1.42%
Max Revenue beat(4)2.26%
Revenue beat(8)6
Avg Revenue beat(8)0.38%
Revenue beat(12)9
Avg Revenue beat(12)0.53%
Revenue beat(16)10
Avg Revenue beat(16)0.43%
PT rev (1m)-1.54%
PT rev (3m)14.29%
EPS NQ rev (1m)1.04%
EPS NQ rev (3m)0.5%
EPS NY rev (1m)0.21%
EPS NY rev (3m)0.14%
Revenue NQ rev (1m)1.01%
Revenue NQ rev (3m)1.41%
Revenue NY rev (1m)0.18%
Revenue NY rev (3m)0.37%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.11 | ||
| Fwd PE | 11.04 | ||
| P/S | 2.7 | ||
| P/FCF | 13.25 | ||
| P/OCF | 10.89 | ||
| P/B | 5.28 | ||
| P/tB | N/A | ||
| EV/EBITDA | 9.42 |
EPS(TTM)8.31
EY8.25%
EPS(NY)9.12
Fwd EY9.06%
FCF(TTM)7.6
FCFY7.55%
OCF(TTM)9.25
OCFY9.19%
SpS37.23
BVpS19.06
TBVpS-14.38
PEG (NY)1.25
PEG (5Y)1.09
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 13.7% | ||
| ROE | 44.28% | ||
| ROCE | 20.54% | ||
| ROIC | 16.73% | ||
| ROICexc | 19.95% | ||
| ROICexgc | 70.13% | ||
| OM | 30.76% | ||
| PM (TTM) | 22.67% | ||
| GM | 47.41% | ||
| FCFM | 20.4% |
ROA(3y)12.82%
ROA(5y)11.01%
ROE(3y)53.2%
ROE(5y)53.78%
ROIC(3y)16.17%
ROIC(5y)14.56%
ROICexc(3y)18.31%
ROICexc(5y)16.12%
ROICexgc(3y)68.06%
ROICexgc(5y)64.53%
ROCE(3y)19.85%
ROCE(5y)17.88%
ROICexcg growth 3Y4.74%
ROICexcg growth 5Y-6.1%
ROICexc growth 3Y12.45%
ROICexc growth 5Y1.03%
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%
F-Score8
Asset Turnover0.6
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.45 | ||
| Debt/FCF | 3.65 | ||
| Debt/EBITDA | 2.15 | ||
| Cap/Depr | 118.18% | ||
| Cap/Sales | 4.43% | ||
| Interest Coverage | 8 | ||
| Cash Conversion | 71.97% | ||
| Profit Quality | 90.01% | ||
| Current Ratio | 3.04 | ||
| Quick Ratio | 2.42 | ||
| Altman-Z | 2.83 |
F-Score8
WACC10.29%
ROIC/WACC1.63
Cap/Depr(3y)102.36%
Cap/Depr(5y)100.29%
Cap/Sales(3y)4.86%
Cap/Sales(5y)5.48%
Profit Quality(3y)93.4%
Profit Quality(5y)106.69%
High Growth Momentum
Growth
EPS 1Y (TTM)11.69%
EPS 3Y26.35%
EPS 5Y11.1%
EPS Q2Q%5.24%
EPS Next Y9.71%
EPS Next 2Y12.28%
EPS Next 3Y16.55%
EPS Next 5Y7.43%
Revenue 1Y (TTM)6.26%
Revenue growth 3Y10.32%
Revenue growth 5Y3.63%
Sales Q2Q%2.71%
Revenue Next Year3.35%
Revenue Next 2Y4.54%
Revenue Next 3Y1.99%
Revenue Next 5Y3.49%
EBIT growth 1Y7.94%
EBIT growth 3Y14.15%
EBIT growth 5Y2.1%
EBIT Next Year23.17%
EBIT Next 3Y9.27%
EBIT Next 5Y7.84%
FCF growth 1Y-0.15%
FCF growth 3Y12.67%
FCF growth 5Y-0.48%
OCF growth 1Y2.17%
OCF growth 3Y8.05%
OCF growth 5Y-1.11%