LATAM AIRLINES GROUP SA-ADR (LTM) Stock Fundamental Analysis
NYSE:LTM - New York Stock Exchange, Inc. - US51817R1068 - ADR - Currency: USD
Overall LTM gets a fundamental rating of 4 out of 10. We evaluated LTM against 23 industry peers in the Passenger Airlines industry. While LTM is still in line with the averages on profitability rating, there are concerns on its financial health. LTM has a bad growth rate and is valued cheaply.
1. Profitability
1.1 Basic Checks
In the past year LTM was profitable.
In the past year LTM had a positive cash flow from operations.
The reported net income has been mixed in the past 5 years: LTM reported negative net income in multiple years.
In multiple years LTM reported negative operating cash flow during the last 5 years.
1.2 Ratios
Looking at the Return On Assets, with a value of 5.18%, LTM belongs to the top of the industry, outperforming 91.30% of the companies in the same industry.
LTM's Return On Equity of 108.77% is amongst the best of the industry. LTM outperforms 100.00% of its industry peers.
LTM has a better Return On Invested Capital (12.03%) than 86.96% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.18% | ||
| ROE | 108.77% | ||
| ROIC | 12.03% |
ROA(3y)-6.95%
ROA(5y)-9.8%
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)N/A
ROIC(5y)N/A
1.3 Margins
The Profit Margin of LTM (6.20%) is better than 86.96% of its industry peers.
In the last couple of years the Profit Margin of LTM has grown nicely.
Looking at the Operating Margin, with a value of 10.81%, LTM belongs to the top of the industry, outperforming 82.61% of the companies in the same industry.
In the last couple of years the Operating Margin of LTM has remained more or less at the same level.
LTM has a Gross Margin of 24.63%. This is in the lower half of the industry: LTM underperforms 69.57% of its industry peers.
In the last couple of years the Gross Margin of LTM has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 10.81% | ||
| PM (TTM) | 6.2% | ||
| GM | 24.63% |
OM growth 3YN/A
OM growth 5Y-0.51%
PM growth 3YN/A
PM growth 5Y9.81%
GM growth 3YN/A
GM growth 5Y2.5%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so LTM is still creating some value.
There is no outstanding debt for LTM. This means it has a Debt/Equity and Debt/FCF ratio of 0 and it is amongst the best of the sector and industry.
2.2 Solvency
LTM has an Altman-Z score of 1.37. This is a bad value and indicates that LTM is not financially healthy and even has some risk of bankruptcy.
LTM has a Altman-Z score of 1.37. This is in the better half of the industry: LTM outperforms 73.91% of its industry peers.
The Debt to FCF ratio of LTM is 4.43, which is a neutral value as it means it would take LTM, 4.43 years of fcf income to pay off all of its debts.
LTM's Debt to FCF ratio of 4.43 is amongst the best of the industry. LTM outperforms 95.65% of its industry peers.
A Debt/Equity ratio of 8.87 is on the high side and indicates that LTM has dependencies on debt financing.
LTM has a worse Debt to Equity ratio (8.87) than 60.87% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 8.87 | ||
| Debt/FCF | 4.43 | ||
| Altman-Z | 1.37 |
ROIC/WACC1.24
WACC9.73%
2.3 Liquidity
A Current Ratio of 0.68 indicates that LTM may have some problems paying its short term obligations.
LTM's Current ratio of 0.68 is in line compared to the rest of the industry. LTM outperforms 56.52% of its industry peers.
LTM has a Quick Ratio of 0.68. This is a bad value and indicates that LTM is not financially healthy enough and could expect problems in meeting its short term obligations.
The Quick ratio of LTM (0.60) is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.68 | ||
| Quick Ratio | 0.6 |
3. Growth
3.1 Past
LTM shows a very negative growth in Earnings Per Share. Measured over the last years, the EPS has been decreasing by -50.65% yearly.
EPS 1Y (TTM)N/A
EPS 3YN/A
EPS 5Y-50.65%
EPS Q2Q%-100%
Revenue 1Y (TTM)N/A
Revenue growth 3YN/A
Revenue growth 5YN/A
Sales Q2Q%5.72%
3.2 Future
The Earnings Per Share is expected to grow by 59.54% on average over the next years. This is a very strong growth
The Revenue is expected to grow by 5.70% on average over the next years.
EPS Next Y245.42%
EPS Next 2Y59.54%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue Next Year7.25%
Revenue Next 2Y5.7%
Revenue Next 3YN/A
Revenue Next 5YN/A
3.3 Evolution
The EPS 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
LTM is valuated quite expensively with a Price/Earnings ratio of 31.83.
Based on the Price/Earnings ratio, LTM is valued a bit cheaper than the industry average as 60.87% of the companies are valued more expensively.
LTM is valuated at similar levels of the S&P average when we compare the Price/Earnings ratio to 29.63, which is the current average of the S&P500 Index.
Based on the Price/Forward Earnings ratio of 9.21, the valuation of LTM can be described as reasonable.
Based on the Price/Forward Earnings ratio, LTM is valued a bit cheaper than the industry average as 69.57% of the companies are valued more expensively.
The average S&P500 Price/Forward Earnings ratio is at 22.68. LTM is valued rather cheaply when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 31.83 | ||
| Fwd PE | 9.21 |
4.2 Price Multiples
Based on the Price/Free Cash Flow ratio, LTM is valued cheaper than 91.30% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 6 | ||
| EV/EBITDA | N/A |
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 LTM may justify a higher PE ratio.
LTM's earnings are expected to grow with 59.54% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.13
PEG (5Y)N/A
EPS Next 2Y59.54%
EPS Next 3YN/A
5. Dividend
5.1 Amount
LTM has a Yearly Dividend Yield of 1.74%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 2.75, LTM pays a better dividend. On top of this LTM pays more dividend than 82.61% of the companies listed in the same industry.
Compared to the average S&P500 Dividend Yield of 2.29, LTM is paying slightly less dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.74% |
5.2 History
The dividend of LTM decreases each year by -72.55%.
LTM has been paying a dividend for over 5 years, so it has already some track record.
Dividend Growth(5Y)-72.55%
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
DPN/A
EPS Next 2Y59.54%
EPS Next 3YN/A
31.83
-0.9 (-2.75%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupTransportation
GICS IndustryPassenger Airlines
Earnings (Last)
Earnings (Next)
Inst Owners108.2%
Inst Owner Change491.75%
Ins OwnersN/A
Ins Owner Change0%
Market Cap9.62B
Analysts80
Price Target28.55 (-10.3%)
Short Float %0.06%
Short Ratio0.71
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.74% |
Yearly Dividend0
Dividend Growth(5Y)-72.55%
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)N/A
Avg EPS beat(2)N/A
Min EPS beat(2)N/A
Max EPS beat(2)N/A
EPS beat(4)N/A
Avg EPS beat(4)N/A
Min EPS beat(4)N/A
Max EPS beat(4)N/A
EPS beat(8)N/A
Avg EPS beat(8)N/A
EPS beat(12)N/A
Avg EPS beat(12)N/A
EPS beat(16)N/A
Avg EPS beat(16)N/A
Revenue beat(2)0
Avg Revenue beat(2)-3.88%
Min Revenue beat(2)-4.36%
Max Revenue beat(2)-3.41%
Revenue beat(4)1
Avg Revenue beat(4)-2.44%
Min Revenue beat(4)-4.36%
Max Revenue beat(4)1.34%
Revenue beat(8)N/A
Avg Revenue beat(8)N/A
Revenue beat(12)N/A
Avg Revenue beat(12)N/A
Revenue beat(16)N/A
Avg Revenue beat(16)N/A
PT rev (1m)0.83%
PT rev (3m)5.75%
EPS NQ rev (1m)N/A
EPS NQ rev (3m)N/A
EPS NY rev (1m)14.45%
EPS NY rev (3m)14.45%
Revenue NQ rev (1m)-1.64%
Revenue NQ rev (3m)-4.09%
Revenue NY rev (1m)-0.3%
Revenue NY rev (3m)-0.6%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 31.83 | ||
| Fwd PE | 9.21 | ||
| P/S | 0.76 | ||
| P/FCF | 6 | ||
| P/OCF | 3.41 | ||
| P/B | 13.28 | ||
| P/tB | N/A | ||
| EV/EBITDA | N/A |
EPS(TTM)1
EY3.14%
EPS(NY)3.45
Fwd EY10.85%
FCF(TTM)5.31
FCFY16.67%
OCF(TTM)9.33
OCFY29.32%
SpS42.05
BVpS2.4
TBVpS-1.2
PEG (NY)0.13
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.18% | ||
| ROE | 108.77% | ||
| ROCE | 15.23% | ||
| ROIC | 12.03% | ||
| ROICexc | 15.61% | ||
| ROICexgc | 18.51% | ||
| OM | 10.81% | ||
| PM (TTM) | 6.2% | ||
| GM | 24.63% | ||
| FCFM | 12.62% |
ROA(3y)-6.95%
ROA(5y)-9.8%
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)N/A
ROIC(5y)N/A
ROICexc(3y)N/A
ROICexc(5y)N/A
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)N/A
ROCE(5y)N/A
ROICexcg growth 3YN/A
ROICexcg growth 5Y11.52%
ROICexc growth 3YN/A
ROICexc growth 5Y15.41%
OM growth 3YN/A
OM growth 5Y-0.51%
PM growth 3YN/A
PM growth 5Y9.81%
GM growth 3YN/A
GM growth 5Y2.5%
F-Score6
Asset Turnover0.83
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 8.87 | ||
| Debt/FCF | 4.43 | ||
| Debt/EBITDA | N/A | ||
| Cap/Depr | N/A | ||
| Cap/Sales | 9.58% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | N/A | ||
| Profit Quality | 203.48% | ||
| Current Ratio | 0.68 | ||
| Quick Ratio | 0.6 | ||
| Altman-Z | 1.37 |
F-Score6
WACC9.73%
ROIC/WACC1.24
Cap/Depr(3y)N/A
Cap/Depr(5y)N/A
Cap/Sales(3y)10.11%
Cap/Sales(5y)10.92%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)N/A
EPS 3YN/A
EPS 5Y-50.65%
EPS Q2Q%-100%
EPS Next Y245.42%
EPS Next 2Y59.54%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue 1Y (TTM)N/A
Revenue growth 3YN/A
Revenue growth 5YN/A
Sales Q2Q%5.72%
Revenue Next Year7.25%
Revenue Next 2Y5.7%
Revenue Next 3YN/A
Revenue Next 5YN/A
EBIT growth 1Y126.1%
EBIT growth 3YN/A
EBIT growth 5Y2.77%
EBIT Next Year167.44%
EBIT Next 3Y47.49%
EBIT Next 5YN/A
FCF growth 1Y1449.08%
FCF growth 3YN/A
FCF growth 5Y1.24%
OCF growth 1Y345.76%
OCF growth 3YN/A
OCF growth 5Y1.77%