We assign a fundamental rating of 6 out of 10 to ATI. ATI was compared to 73 industry peers in the Aerospace & Defense industry. ATI scores excellent on profitability, but there are some minor concerns on its financial health. ATI has a decent growth rate and is not valued too expensively.

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1. Profitability

2. Health

3. Growth

4. Valuation

5. Dividend

1. Profitability

1.1 Basic Checks

ATI had positive earnings in the past year.
ATI had a positive operating cash flow in the past year.
The reported net income has been mixed in the past 5 years: ATI reported negative net income in multiple years.
Each year in the past 5 years ATI had a positive operating cash flow.

1.2 Ratios

The Return On Assets of ATI (8.89%) is better than 90.41% of its industry peers.
ATI has a better Return On Equity (26.06%) than 95.89% of its industry peers.
ATI's Return On Invested Capital of 13.13% is amongst the best of the industry. ATI outperforms 90.41% of its industry peers.
The Average Return On Invested Capital over the past 3 years for ATI is in line with the industry average of 8.56%.
The 3 year average ROIC (10.03%) for ATI is below the current ROIC(13.13%), indicating increased profibility in the last year.

		Industry Rank	Sector Rank
ROA	8.89%
ROE	26.06%
ROIC	13.13%

ROA(3y)6.07%

ROA(5y)-4.33%

ROE(3y)20.77%

ROE(5y)-49.01%

ROIC(3y)10.03%

ROIC(5y)6.93%

1.3 Margins

ATI has a better Profit Margin (9.71%) than 78.08% of its industry peers.
In the last couple of years the Profit Margin of ATI has grown nicely.
ATI's Operating Margin of 14.33% is amongst the best of the industry. ATI outperforms 82.19% of its industry peers.
ATI's Operating Margin has improved in the last couple of years.
Looking at the Gross Margin, with a value of 21.83%, ATI is in line with its industry, outperforming 43.84% of the companies in the same industry.
In the last couple of years the Gross Margin of ATI has grown nicely.

		Industry Rank	Sector Rank
OM	14.33%
PM (TTM)	9.71%
GM	21.83%

OM growth 3Y49.73%

OM growth 5Y7.23%

PM growth 3YN/A

PM growth 5Y6.18%

GM growth 3Y20.05%

GM growth 5Y5.88%

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ROA

ROE

ROIC

Operating and Profit Margin

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2. Health

2.1 Basic Checks

ATI has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
The number of shares outstanding for ATI has been increased compared to 1 year ago.
The number of shares outstanding for ATI has been increased compared to 5 years ago.
Compared to 1 year ago, ATI has an improved debt to assets ratio.

2.2 Solvency

ATI has an Altman-Z score of 4.88. This indicates that ATI is financially healthy and has little risk of bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 4.88, ATI is in line with its industry, outperforming 58.90% of the companies in the same industry.
The Debt to FCF ratio of ATI is 4.13, which is a neutral value as it means it would take ATI, 4.13 years of fcf income to pay off all of its debts.
The Debt to FCF ratio of ATI (4.13) is better than 78.08% of its industry peers.
A Debt/Equity ratio of 1.00 is on the high side and indicates that ATI has dependencies on debt financing.
ATI has a worse Debt to Equity ratio (1.00) than 76.71% of its industry peers.

		Industry Rank	Sector Rank
Debt/Equity	1
Debt/FCF	4.13
Altman-Z	4.88

ROIC/WACC1.34

WACC9.81%

2.3 Liquidity

ATI has a Current Ratio of 2.50. This indicates that ATI is financially healthy and has no problem in meeting its short term obligations.
Looking at the Current ratio, with a value of 2.50, ATI is in line with its industry, outperforming 49.32% of the companies in the same industry.
A Quick Ratio of 1.18 indicates that ATI should not have too much problems paying its short term obligations.
ATI has a worse Quick ratio (1.18) than 63.01% of its industry peers.

		Industry Rank	Sector Rank
Current Ratio	2.5
Quick Ratio	1.18

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WACC

Debt/Equity

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Altman-Z score

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3. Growth

3.1 Past

ATI shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 33.62%, which is quite impressive.
ATI shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 15.34% yearly.
ATI shows a small growth in Revenue. In the last year, the Revenue has grown by 7.75%.
ATI shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 1.14% yearly.

EPS 1Y (TTM)33.62%

EPS 3Y174.06%

EPS 5Y15.34%

EPS Q2Q%41.67%

Revenue 1Y (TTM)7.75%

Revenue growth 3Y15.93%

Revenue growth 5Y1.14%

Sales Q2Q%7.07%

3.2 Future

ATI is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 19.88% yearly.
The Revenue is expected to grow by 7.30% on average over the next years.

EPS Next Y30.76%

EPS Next 2Y26.67%

EPS Next 3Y23.96%

EPS Next 5Y19.88%

Revenue Next Year7.28%

Revenue Next 2Y7.82%

Revenue Next 3Y7.93%

Revenue Next 5Y7.3%

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.

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4. Valuation

4.1 Price/Earnings Ratio

The Price/Earnings ratio is 39.85, which means the current valuation is very expensive for ATI.
Based on the Price/Earnings ratio, ATI is valued a bit cheaper than the industry average as 67.12% of the companies are valued more expensively.
Compared to an average S&P500 Price/Earnings ratio of 27.21, ATI is valued a bit more expensive.
The Price/Forward Earnings ratio is 31.17, which means the current valuation is very expensive for ATI.
ATI's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. ATI is cheaper than 73.97% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of ATI to the average of the S&P500 Index (24.26), we can say ATI is valued slightly more expensively.

		Industry Rank	Sector Rank
PE	39.85
Fwd PE	31.17

4.2 Price Multiples

71.23% of the companies in the same industry are more expensive than ATI, based on the Enterprise Value to EBITDA ratio.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of ATI indicates a rather cheap valuation: ATI is cheaper than 84.93% of the companies listed in the same industry.

		Industry Rank	Sector Rank
P/FCF	36.39
EV/EBITDA	22.23

4.3 Compensation for Growth

The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
ATI has an outstanding profitability rating, which may justify a higher PE ratio.
A more expensive valuation may be justified as ATI's earnings are expected to grow with 23.96% in the coming years.