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NASDAQ:ALGM—A High-Growth Stock Gearing Up for Its Next Upward Move.

By Mill Chart

Last update: Oct 13, 2023

In this article we will dive into ALLEGRO MICROSYSTEMS INC (NASDAQ:ALGM) as a possible candidate for growth investing. Investors should always do their own research, but we noticed ALLEGRO MICROSYSTEMS INC showing up in our strong growth, ready to breakout screen, which makes it worth to investigate a bit more.

Unpacking NASDAQ:ALGM's Growth Rating

To evaluate a stock's growth potential, ChartMill utilizes a Growth Rating on a scale of 0 to 10. This comprehensive assessment considers various growth aspects, including historical and estimated EPS and revenue growth. NASDAQ:ALGM has achieved a 8 out of 10:

  • ALGM shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 69.05%, which is quite impressive.
  • The Earnings Per Share has been growing by 69.11% on average over the past years. This is a very strong growth
  • ALGM shows a strong growth in Revenue. In the last year, the Revenue has grown by 29.55%.
  • Measured over the past years, ALGM shows a quite strong growth in Revenue. The Revenue has been growing by 14.41% on average per year.
  • ALGM is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 14.03% yearly.
  • ALGM is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 10.75% yearly.

What does the Health looks like for NASDAQ:ALGM

To gauge a stock's financial health, ChartMill utilizes a Health Rating on a scale of 0 to 10. This comprehensive evaluation encompasses liquidity and solvency, both in absolute terms and in comparison to industry peers. NASDAQ:ALGM has earned a 8 out of 10:

  • ALGM has an Altman-Z score of 19.46. This indicates that ALGM is financially healthy and has little risk of bankruptcy at the moment.
  • The Altman-Z score of ALGM (19.46) is better than 88.68% of its industry peers.
  • The Debt to FCF ratio of ALGM is 0.26, which is an excellent value as it means it would take ALGM, only 0.26 years of fcf income to pay off all of its debts.
  • ALGM has a better Debt to FCF ratio (0.26) than 83.02% of its industry peers.
  • ALGM has a Debt/Equity ratio of 0.02. This is a healthy value indicating a solid balance between debt and equity.
  • ALGM has a better Debt to Equity ratio (0.02) than 68.87% of its industry peers.
  • A Current Ratio of 4.56 indicates that ALGM has no problem at all paying its short term obligations.
  • The Current ratio of ALGM (4.56) is better than 70.75% of its industry peers.
  • A Quick Ratio of 3.43 indicates that ALGM has no problem at all paying its short term obligations.
  • With a decent Quick ratio value of 3.43, ALGM is doing good in the industry, outperforming 68.87% of the companies in the same industry.

What does the Profitability looks like for NASDAQ:ALGM

Discover ChartMill's exclusive Profitability Rating, a proprietary metric that assesses stocks on a scale of 0 to 10. It takes into consideration various profitability ratios and margins, both in absolute terms and relative to industry peers. Notably, NASDAQ:ALGM has achieved a 8:

  • ALGM has a better Return On Assets (19.28%) than 88.68% of its industry peers.
  • ALGM has a better Return On Equity (23.18%) than 78.30% of its industry peers.
  • ALGM has a better Return On Invested Capital (20.84%) than 84.91% of its industry peers.
  • The last Return On Invested Capital (20.84%) for ALGM is above the 3 year average (11.69%), which is a sign of increasing profitability.
  • Looking at the Profit Margin, with a value of 23.01%, ALGM is in the better half of the industry, outperforming 78.30% of the companies in the same industry.
  • In the last couple of years the Profit Margin of ALGM has grown nicely.
  • ALGM's Operating Margin of 25.07% is fine compared to the rest of the industry. ALGM outperforms 75.47% of its industry peers.
  • In the last couple of years the Operating Margin of ALGM has grown nicely.
  • The Gross Margin of ALGM (56.63%) is better than 71.70% of its industry peers.
  • In the last couple of years the Gross Margin of ALGM has grown nicely.

Looking at the Setup

Next to the Technical Rating, the Setup Rating of a stock determines to which extend the stock is consolidating. This score also ranges from 0 to 10 and is updated daily. The setup score evaluates various short term technical indicators. For NASDAQ:ALGM this score is currently 7:

Although the technical rating is bad, ALGM does present a nice setup opportunity. Prices have been consolidating lately and the volatility has been reduced.

Every day, new Strong Growth stocks can be found on ChartMill in our Strong Growth screener.

For an up to date full fundamental analysis you can check the fundamental report of ALGM

Our latest full technical report of ALGM contains the most current technical analsysis.

Disclaimer

This article should in no way be interpreted as advice in any way. The article is based on the observed metrics at the time of writing, but you should always make your own analysis and trade or invest at your own responsibility.

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ALLEGRO MICROSYSTEMS INC

NASDAQ:ALGM (2/26/2024, 7:18:28 PM)

After market: 31.74 +0.02 (+0.06%)

31.72

+1.04 (+3.39%)

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