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For those who appreciate value investing, NASDAQ:ASO is a compelling option with its solid fundamentals.

By Mill Chart

Last update: Apr 17, 2024

Our stock screener has spotted ACADEMY SPORTS & OUTDOORS IN (NASDAQ:ASO) as an undervalued stock with solid fundamentals. NASDAQ:ASO shows decent health and profitability. At the same time it remains remains attractively priced. We'll dive into each aspect below.

Understanding NASDAQ:ASO's Valuation

ChartMill employs its own Valuation Rating system for all stocks. This score, ranging from 0 to 10, is determined by evaluating different valuation factors, including price to earnings and free cash flow, both in absolute terms and relative to the market and industry. NASDAQ:ASO has earned a 7 for valuation:

  • With a Price/Earnings ratio of 8.50, the valuation of ASO can be described as very reasonable.
  • 88.00% of the companies in the same industry are more expensive than ASO, based on the Price/Earnings ratio.
  • The average S&P500 Price/Earnings ratio is at 24.93. ASO is valued rather cheaply when compared to this.
  • The Price/Forward Earnings ratio is 8.66, which indicates a very decent valuation of ASO.
  • 86.40% of the companies in the same industry are more expensive than ASO, based on the Price/Forward Earnings ratio.
  • Compared to an average S&P500 Price/Forward Earnings ratio of 21.41, ASO is valued rather cheaply.
  • Based on the Enterprise Value to EBITDA ratio, ASO is valued a bit cheaper than the industry average as 77.60% of the companies are valued more expensively.
  • ASO's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. ASO is cheaper than 69.60% of the companies in the same industry.
  • The excellent profitability rating of ASO may justify a higher PE ratio.

Profitability Assessment of NASDAQ:ASO

ChartMill's Profitability Rating offers a unique perspective on stock analysis, providing scores from 0 to 10. These ratings consider a wide range of profitability metrics and margins, both in comparison to industry peers and on their own merits. For NASDAQ:ASO, the assigned 8 is a significant indicator of profitability:

  • ASO has a Return On Assets of 11.10%. This is amongst the best in the industry. ASO outperforms 84.80% of its industry peers.
  • Looking at the Return On Equity, with a value of 26.56%, ASO belongs to the top of the industry, outperforming 81.60% of the companies in the same industry.
  • ASO has a Return On Invested Capital of 13.84%. This is in the better half of the industry: ASO outperforms 80.00% of its industry peers.
  • The Average Return On Invested Capital over the past 3 years for ASO is above the industry average of 14.70%.
  • The Profit Margin of ASO (8.43%) is better than 87.20% of its industry peers.
  • ASO's Profit Margin has improved in the last couple of years.
  • ASO's Operating Margin of 11.01% is amongst the best of the industry. ASO outperforms 84.80% of its industry peers.
  • In the last couple of years the Operating Margin of ASO has grown nicely.
  • ASO's Gross Margin has improved in the last couple of years.

Evaluating Health: NASDAQ:ASO

ChartMill assigns a Health Rating to every stock. This score ranges from 0 to 10 and evaluates the different health aspects like liquidity and solvency, both absolutely, but also relative to the industry peers. NASDAQ:ASO scores a 8 out of 10:

  • An Altman-Z score of 3.48 indicates that ASO is not in any danger for bankruptcy at the moment.
  • ASO has a Altman-Z score of 3.48. This is in the better half of the industry: ASO outperforms 76.00% of its industry peers.
  • The Debt to FCF ratio of ASO is 1.49, which is an excellent value as it means it would take ASO, only 1.49 years of fcf income to pay off all of its debts.
  • ASO's Debt to FCF ratio of 1.49 is fine compared to the rest of the industry. ASO outperforms 76.00% of its industry peers.
  • ASO has a Debt/Equity ratio of 0.25. This is a healthy value indicating a solid balance between debt and equity.
  • ASO has a better Debt to Equity ratio (0.25) than 60.80% of its industry peers.
  • Looking at the Current ratio, with a value of 1.87, ASO is in the better half of the industry, outperforming 73.60% of the companies in the same industry.
  • ASO does not score too well on the current and quick ratio evaluation. However, as it has excellent solvency and profitability, these ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.

Evaluating Growth: NASDAQ:ASO

A key component of ChartMill's stock assessment is the Growth Rating, which spans from 0 to 10. This rating evaluates diverse growth factors, such as EPS and revenue growth, considering both past performance and future projections. NASDAQ:ASO has received a 4 out of 10:

  • ASO shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 94.62% yearly.
  • The Earnings Per Share is expected to grow by 13.68% on average over the next years. This is quite good.
  • When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.

Every day, new Decent Value stocks can be found on ChartMill in our Decent Value screener.

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

Disclaimer

Important Note: The content of this article is not intended as trading advice. It is essential to perform your own analysis and exercise caution when making trading decisions. The article presents observations created by automated analysis but does not guarantee any trading or investment outcomes. Always trade responsibly and make independent judgments.

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ACADEMY SPORTS & OUTDOORS IN

NASDAQ:ASO (5/17/2024, 7:00:01 PM)

After market: 53.71 0 (0%)

53.71

-0.68 (-1.25%)

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