ALLISON TRANSMISSION HOLDING (ALSN) Stock Fundamental Analysis
NYSE:ALSN - New York Stock Exchange, Inc. - US01973R1014 - Common Stock - Currency: USD
ALSN gets a fundamental rating of 7 out of 10. The analysis compared the fundamentals against 128 industry peers in the Machinery industry. Both the health and profitability get an excellent rating, making ALSN a very profitable company, without any liquidiy or solvency issues. ALSN may be a bit undervalued, certainly considering the very reasonable score on growth These ratings could make ALSN a good candidate for value investing.
1. Profitability
1.1 Basic Checks
ALSN had positive earnings in the past year.
In the past year ALSN had a positive cash flow from operations.
ALSN had positive earnings in each of the past 5 years.
ALSN had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
The Return On Assets of ALSN (14.05%) is better than 92.97% of its industry peers.
With an excellent Return On Equity value of 45.29%, ALSN belongs to the best of the industry, outperforming 96.09% of the companies in the same industry.
ALSN has a better Return On Invested Capital (16.90%) than 89.84% 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 10.71%.
The last Return On Invested Capital (16.90%) for ALSN is above the 3 year average (16.17%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 14.05% | ||
| ROE | 45.29% | ||
| ROIC | 16.9% |
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
With an excellent Profit Margin value of 23.55%, ALSN belongs to the best of the industry, outperforming 98.44% 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 Operating Margin of 31.45%. This is amongst the best in the industry. ALSN outperforms 99.22% of its industry peers.
ALSN's Operating Margin has been stable in the last couple of years.
Looking at the Gross Margin, with a value of 48.13%, ALSN belongs to the top of the industry, outperforming 91.41% 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 | 31.45% | ||
| PM (TTM) | 23.55% | ||
| GM | 48.13% |
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
ALSN 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, 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 2.73. 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.
With a Altman-Z score value of 2.73, ALSN perfoms like the industry average, outperforming 42.97% of the companies in the same industry.
ALSN has a debt to FCF ratio of 3.69. This is a good value and a sign of high solvency as ALSN would need 3.69 years to pay back of all of its debts.
The Debt to FCF ratio of ALSN (3.69) is better than 60.16% of its industry peers.
ALSN has a Debt/Equity ratio of 1.44. This is a high value indicating a heavy dependency on external financing.
ALSN has a Debt to Equity ratio of 1.44. This is amonst the worse of the industry: ALSN underperforms 84.38% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.44 | ||
| Debt/FCF | 3.69 | ||
| Altman-Z | 2.73 |
ROIC/WACC1.72
WACC9.82%
2.3 Liquidity
ALSN has a Current Ratio of 3.05. This indicates that ALSN is financially healthy and has no problem in meeting its short term obligations.
ALSN has a Current ratio of 3.05. This is in the better half of the industry: ALSN outperforms 76.56% of its industry peers.
ALSN has a Quick Ratio of 2.37. This indicates that ALSN is financially healthy and has no problem in meeting its short term obligations.
The Quick ratio of ALSN (2.37) is better than 80.47% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 3.05 | ||
| Quick Ratio | 2.37 |
3. Growth
3.1 Past
ALSN shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 15.35%, which is quite good.
The Earnings Per Share has been growing by 11.10% on average over the past years. This is quite good.
The Revenue has been growing slightly by 3.86% in the past year.
The Revenue has been growing slightly by 3.63% on average over the past years.
EPS 1Y (TTM)15.35%
EPS 3Y26.35%
EPS 5Y11.1%
EPS Q2Q%17.37%
Revenue 1Y (TTM)3.86%
Revenue growth 3Y10.32%
Revenue growth 5Y3.63%
Sales Q2Q%-2.92%
3.2 Future
The Earnings Per Share is expected to grow by 6.32% on average over the next years.
The Revenue is expected to grow by 3.34% on average over the next years.
EPS Next Y7.6%
EPS Next 2Y10.08%
EPS Next 3Y9%
EPS Next 5Y6.32%
Revenue Next Year-0.73%
Revenue Next 2Y1.38%
Revenue Next 3Y1.68%
Revenue Next 5Y3.34%
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 stable.
4. Valuation
4.1 Price/Earnings Ratio
ALSN is valuated reasonably with a Price/Earnings ratio of 11.33.
ALSN's Price/Earnings ratio is rather cheap when compared to the industry. ALSN is cheaper than 91.41% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 27.45, ALSN is valued rather cheaply.
Based on the Price/Forward Earnings ratio of 9.72, the valuation of ALSN can be described as reasonable.
92.97% of the companies in the same industry are more expensive than ALSN, based on the Price/Forward Earnings ratio.
ALSN's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 21.90.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 11.33 | ||
| Fwd PE | 9.72 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, ALSN is valued cheaper than 82.03% of the companies in the same industry.
89.84% of the companies in the same industry are more expensive than ALSN, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 12.67 | ||
| EV/EBITDA | 8.77 |
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.
PEG (NY)1.49
PEG (5Y)1.02
EPS Next 2Y10.08%
EPS Next 3Y9%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 1.15%, ALSN has a reasonable but not impressive dividend return.
ALSN's Dividend Yield is a higher than the industry average which is at 1.88.
Compared to an average S&P500 Dividend Yield of 2.42, ALSN's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.15% |
5.2 History
On average, the dividend of ALSN grows each year by 10.94%, which is quite nice.
ALSN has paid a dividend for at least 10 years, which is 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
ALSN pays out 11.80% of its income as dividend. This is a sustainable payout ratio.
ALSN's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP11.8%
EPS Next 2Y10.08%
EPS Next 3Y9%
97.93
+0.22 (+0.23%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryMachinery
Earnings (Last)
Earnings (Next)
Inst Owners101.33%
Inst Owner Change-0.82%
Ins Owners0.59%
Ins Owner Change5.48%
Market Cap8.25B
Analysts72
Price Target104.38 (6.59%)
Short Float %3.46%
Short Ratio3.96
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.15% |
Yearly Dividend1
Dividend Growth(5Y)10.94%
DP11.8%
Div Incr Years5
Div Non Decr Years12
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)5.32%
Min EPS beat(2)3.3%
Max EPS beat(2)7.34%
EPS beat(4)4
Avg EPS beat(4)6.02%
Min EPS beat(4)3.14%
Max EPS beat(4)10.3%
EPS beat(8)6
Avg EPS beat(8)8.51%
EPS beat(12)9
Avg EPS beat(12)8.97%
EPS beat(16)12
Avg EPS beat(16)8.9%
Revenue beat(2)0
Avg Revenue beat(2)-3.5%
Min Revenue beat(2)-5.59%
Max Revenue beat(2)-1.42%
Revenue beat(4)2
Avg Revenue beat(4)-1.17%
Min Revenue beat(4)-5.59%
Max Revenue beat(4)2.26%
Revenue beat(8)5
Avg Revenue beat(8)-0.48%
Revenue beat(12)8
Avg Revenue beat(12)-0.18%
Revenue beat(16)10
Avg Revenue beat(16)0.13%
PT rev (1m)3.97%
PT rev (3m)-4.23%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-1.5%
EPS NY rev (1m)0.58%
EPS NY rev (3m)-1.81%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-2.07%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-2.63%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 11.33 | ||
| Fwd PE | 9.72 | ||
| P/S | 2.58 | ||
| P/FCF | 12.67 | ||
| P/OCF | 10.2 | ||
| P/B | 4.96 | ||
| P/tB | N/A | ||
| EV/EBITDA | 8.77 |
EPS(TTM)8.64
EY8.82%
EPS(NY)10.07
Fwd EY10.28%
FCF(TTM)7.73
FCFY7.89%
OCF(TTM)9.6
OCFY9.81%
SpS38.01
BVpS19.76
TBVpS-14.6
PEG (NY)1.49
PEG (5Y)1.02
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 14.05% | ||
| ROE | 45.29% | ||
| ROCE | 20.75% | ||
| ROIC | 16.9% | ||
| ROICexc | 20% | ||
| ROICexgc | 68.06% | ||
| OM | 31.45% | ||
| PM (TTM) | 23.55% | ||
| GM | 48.13% | ||
| FCFM | 20.33% |
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 | 1.44 | ||
| Debt/FCF | 3.69 | ||
| Debt/EBITDA | 2.13 | ||
| Cap/Depr | 132.77% | ||
| Cap/Sales | 4.93% | ||
| Interest Coverage | 8.25 | ||
| Cash Conversion | 71.85% | ||
| Profit Quality | 86.34% | ||
| Current Ratio | 3.05 | ||
| Quick Ratio | 2.37 | ||
| Altman-Z | 2.73 |
F-Score8
WACC9.82%
ROIC/WACC1.72
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)15.35%
EPS 3Y26.35%
EPS 5Y11.1%
EPS Q2Q%17.37%
EPS Next Y7.6%
EPS Next 2Y10.08%
EPS Next 3Y9%
EPS Next 5Y6.32%
Revenue 1Y (TTM)3.86%
Revenue growth 3Y10.32%
Revenue growth 5Y3.63%
Sales Q2Q%-2.92%
Revenue Next Year-0.73%
Revenue Next 2Y1.38%
Revenue Next 3Y1.68%
Revenue Next 5Y3.34%
EBIT growth 1Y9.1%
EBIT growth 3Y14.15%
EBIT growth 5Y2.1%
EBIT Next Year15.77%
EBIT Next 3Y8.15%
EBIT Next 5Y7.04%
FCF growth 1Y26.16%
FCF growth 3Y12.67%
FCF growth 5Y-0.48%
OCF growth 1Y17.76%
OCF growth 3Y8.05%
OCF growth 5Y-1.11%