ARGAN (ARG.PA) Stock Fundamental Analysis
Europe - Euronext Paris - EPA:ARG - FR0010481960 - REIT
64.8 EUR
-0.4 (-0.61%)
Overall ARG gets a fundamental rating of 5 out of 10. We evaluated ARG against 41 industry peers in the Diversified REITs industry. While ARG belongs to the best of the industry regarding profitability, there are concerns on its financial health. ARG may be a bit undervalued, certainly considering the very reasonable score on growth Finally ARG also has an excellent dividend rating.
1. Profitability
1.1 Basic Checks
- In the past year ARG was profitable.
- ARG had a positive operating cash flow in the past year.
- ARG had positive earnings in 4 of the past 5 years.
- In the past 5 years ARG always reported a positive cash flow from operatings.
1.2 Ratios
- Looking at the Return On Assets, with a value of 6.76%, ARG belongs to the top of the industry, outperforming 100.00% of the companies in the same industry.
- ARG's Return On Equity of 12.66% is amongst the best of the industry. ARG outperforms 97.56% of its industry peers.
- With a Return On Invested Capital value of 3.48%, ARG perfoms like the industry average, outperforming 53.66% of the companies in the same industry.
- ARG had an Average Return On Invested Capital over the past 3 years of 3.13%. This is in line with the industry average of 3.37%.
- The last Return On Invested Capital (3.48%) for ARG is above the 3 year average (3.13%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.76% | ||
| ROE | 12.66% | ||
| ROIC | 3.48% |
ROA(3y)0.48%
ROA(5y)4.9%
ROE(3y)0.46%
ROE(5y)10.33%
ROIC(3y)3.13%
ROIC(5y)3.04%
1.3 Margins
- The Profit Margin of ARG (139.56%) is better than 100.00% of its industry peers.
- In the last couple of years the Profit Margin of ARG has declined.
- Looking at the Operating Margin, with a value of 92.83%, ARG belongs to the top of the industry, outperforming 92.68% of the companies in the same industry.
- ARG's Operating Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 92.83% | ||
| PM (TTM) | 139.56% | ||
| GM | N/A |
OM growth 3Y-0.31%
OM growth 5Y17.53%
PM growth 3Y-33.91%
PM growth 5Y-10.3%
GM growth 3YN/A
GM growth 5YN/A
2. Health
2.1 Basic Checks
- ARG has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
- Compared to 1 year ago, ARG has more shares outstanding
- ARG has more shares outstanding than it did 5 years ago.
- Compared to 1 year ago, ARG has an improved debt to assets ratio.
2.2 Solvency
- ARG has an Altman-Z score of 1.29. This is a bad value and indicates that ARG is not financially healthy and even has some risk of bankruptcy.
- ARG has a better Altman-Z score (1.29) than 82.93% of its industry peers.
- The Debt to FCF ratio of ARG is 9.50, which is on the high side as it means it would take ARG, 9.50 years of fcf income to pay off all of its debts.
- ARG has a Debt to FCF ratio of 9.50. This is amongst the best in the industry. ARG outperforms 82.93% of its industry peers.
- ARG has a Debt/Equity ratio of 0.76. This is a neutral value indicating ARG is somewhat dependend on debt financing.
- ARG has a Debt to Equity ratio (0.76) which is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.76 | ||
| Debt/FCF | 9.5 | ||
| Altman-Z | 1.29 |
ROIC/WACC0.6
WACC5.76%
2.3 Liquidity
- ARG has a Current Ratio of 0.52. This is a bad value and indicates that ARG is not financially healthy enough and could expect problems in meeting its short term obligations.
- The Current ratio of ARG (0.52) is comparable to the rest of the industry.
- ARG has a Quick Ratio of 0.52. This is a bad value and indicates that ARG is not financially healthy enough and could expect problems in meeting its short term obligations.
- ARG has a Quick ratio (0.52) which is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.52 | ||
| Quick Ratio | 0.52 |
3. Growth
3.1 Past
- ARG shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 191.42%, which is quite impressive.
- ARG shows a decrease in Earnings Per Share. Measured over the last years, the EPS has been decreasing by -3.87% yearly.
- ARG shows a small growth in Revenue. In the last year, the Revenue has grown by 7.89%.
- Measured over the past years, ARG shows a quite strong growth in Revenue. The Revenue has been growing by 14.50% on average per year.
EPS 1Y (TTM)191.42%
EPS 3Y-30.53%
EPS 5Y-3.87%
EPS Q2Q%39.96%
Revenue 1Y (TTM)7.89%
Revenue growth 3Y8.41%
Revenue growth 5Y14.5%
Sales Q2Q%7.59%
3.2 Future
- Based on estimates for the next years, ARG will show a small growth in Earnings Per Share. The EPS will grow by 2.50% on average per year.
- Based on estimates for the next years, ARG will show a small growth in Revenue. The Revenue will grow by 4.73% on average per year.
EPS Next Y7.52%
EPS Next 2Y4.02%
EPS Next 3Y2.62%
EPS Next 5Y2.5%
Revenue Next Year6.57%
Revenue Next 2Y5.1%
Revenue Next 3Y4.73%
Revenue Next 5Y4.73%
3.3 Evolution
- The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
- When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
- A Price/Earnings ratio of 5.63 indicates a rather cheap valuation of ARG.
- ARG's Price/Earnings ratio is rather cheap when compared to the industry. ARG is cheaper than 100.00% of the companies in the same industry.
- When comparing the Price/Earnings ratio of ARG to the average of the S&P500 Index (27.21), we can say ARG is valued rather cheaply.
- A Price/Forward Earnings ratio of 10.66 indicates a reasonable valuation of ARG.
- Based on the Price/Forward Earnings ratio, ARG is valued a bit cheaper than 68.29% of the companies in the same industry.
- ARG's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 25.98.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 5.63 | ||
| Fwd PE | 10.66 |
4.2 Price Multiples
- The rest of the industry has a similar Enterprise Value to EBITDA ratio as ARG.
- 75.61% of the companies in the same industry are more expensive than ARG, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 8.65 | ||
| EV/EBITDA | 17.94 |
4.3 Compensation for Growth
- The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
- The decent profitability rating of ARG may justify a higher PE ratio.
PEG (NY)0.75
PEG (5Y)N/A
EPS Next 2Y4.02%
EPS Next 3Y2.62%
5. Dividend
5.1 Amount
- ARG has a Yearly Dividend Yield of 5.09%, which is a nice return.
- Compared to an average industry Dividend Yield of 5.41, ARG has a dividend in line with its industry peers.
- Compared to an average S&P500 Dividend Yield of 1.81, ARG pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 5.09% |
5.2 History
- On average, the dividend of ARG grows each year by 32.61%, which is quite nice.
Dividend Growth(5Y)32.61%
Div Incr Years2
Div Non Decr Years2
5.3 Sustainability
- 22.47% of the earnings are spent on dividend by ARG. This is a low number and sustainable payout ratio.
- The dividend of ARG is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP22.47%
EPS Next 2Y4.02%
EPS Next 3Y2.62%
ARGAN / ARG.PA FAQ
Can you provide the ChartMill fundamental rating for ARGAN?
ChartMill assigns a fundamental rating of 5 / 10 to ARG.PA.
Can you provide the valuation status for ARGAN?
ChartMill assigns a valuation rating of 7 / 10 to ARGAN (ARG.PA). This can be considered as Undervalued.
Can you provide the profitability details for ARGAN?
ARGAN (ARG.PA) has a profitability rating of 7 / 10.
Can you provide the PE and PB ratios for ARG stock?
The Price/Earnings (PE) ratio for ARGAN (ARG.PA) is 5.63 and the Price/Book (PB) ratio is 0.73.
Can you provide the dividend sustainability for ARG stock?
The dividend rating of ARGAN (ARG.PA) is 7 / 10 and the dividend payout ratio is 22.47%.