APPLIED INDUSTRIAL TECH INC (AIT) Stock Fundamental Analysis
NYSE:AIT - New York Stock Exchange, Inc. - US03820C1053 - Common Stock - Currency: USD
AIT gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 48 industry peers in the Trading Companies & Distributors industry. Both the health and profitability get an excellent rating, making AIT a very profitable company, without any liquidiy or solvency issues. AIT has a expensive valuation and it also scores bad on growth.
1. Profitability
1.1 Basic Checks
AIT had positive earnings in the past year.
AIT had a positive operating cash flow in the past year.
AIT had positive earnings in each of the past 5 years.
AIT had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
The Return On Assets of AIT (12.47%) is better than 95.83% of its industry peers.
AIT has a better Return On Equity (21.27%) than 79.17% of its industry peers.
AIT has a Return On Invested Capital of 14.71%. This is amongst the best in the industry. AIT outperforms 87.50% of its industry peers.
AIT had an Average Return On Invested Capital over the past 3 years of 15.46%. This is significantly above the industry average of 9.66%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 12.47% | ||
| ROE | 21.27% | ||
| ROIC | 14.71% |
ROA(3y)12.07%
ROA(5y)8.73%
ROE(3y)23%
ROE(5y)17.48%
ROIC(3y)15.46%
ROIC(5y)13.38%
1.3 Margins
AIT has a Profit Margin of 8.64%. This is amongst the best in the industry. AIT outperforms 81.25% of its industry peers.
AIT's Profit Margin has improved in the last couple of years.
AIT's Operating Margin of 11.17% is fine compared to the rest of the industry. AIT outperforms 75.00% of its industry peers.
In the last couple of years the Operating Margin of AIT has grown nicely.
AIT has a Gross Margin (30.33%) which is comparable to the rest of the industry.
In the last couple of years the Gross Margin of AIT has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 11.17% | ||
| PM (TTM) | 8.64% | ||
| GM | 30.33% |
OM growth 3Y10.87%
OM growth 5Y7.5%
PM growth 3Y24.39%
PM growth 5Y15.74%
GM growth 3Y0.8%
GM growth 5Y0.55%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), AIT is creating some value.
The number of shares outstanding for AIT has been reduced compared to 1 year ago.
Compared to 5 years ago, AIT has less shares outstanding
The debt/assets ratio for AIT has been reduced compared to a year ago.
2.2 Solvency
AIT has an Altman-Z score of 7.68. This indicates that AIT is financially healthy and has little risk of bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 7.68, AIT belongs to the top of the industry, outperforming 91.67% of the companies in the same industry.
The Debt to FCF ratio of AIT is 1.30, which is an excellent value as it means it would take AIT, only 1.30 years of fcf income to pay off all of its debts.
AIT has a Debt to FCF ratio of 1.30. This is amongst the best in the industry. AIT outperforms 81.25% of its industry peers.
A Debt/Equity ratio of 0.31 indicates that AIT is not too dependend on debt financing.
AIT has a Debt to Equity ratio of 0.31. This is in the better half of the industry: AIT outperforms 60.42% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.31 | ||
| Debt/FCF | 1.3 | ||
| Altman-Z | 7.68 |
ROIC/WACC1.48
WACC9.95%
2.3 Liquidity
A Current Ratio of 3.57 indicates that AIT has no problem at all paying its short term obligations.
Looking at the Current ratio, with a value of 3.57, AIT belongs to the top of the industry, outperforming 81.25% of the companies in the same industry.
A Quick Ratio of 2.51 indicates that AIT has no problem at all paying its short term obligations.
The Quick ratio of AIT (2.51) is better than 85.42% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 3.57 | ||
| Quick Ratio | 2.51 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 4.40% over the past year.
The Earnings Per Share has been growing by 16.45% on average over the past years. This is quite good.
AIT shows a small growth in Revenue. In the last year, the Revenue has grown by 0.50%.
The Revenue has been growing slightly by 5.22% on average over the past years.
EPS 1Y (TTM)4.4%
EPS 3Y28.07%
EPS 5Y16.45%
EPS Q2Q%3.63%
Revenue 1Y (TTM)0.5%
Revenue growth 3Y11.45%
Revenue growth 5Y5.22%
Sales Q2Q%1.78%
3.2 Future
Based on estimates for the next years, AIT will show a small growth in Earnings Per Share. The EPS will grow by 5.62% on average per year.
The Revenue is expected to grow by 3.94% on average over the next years.
EPS Next Y2.28%
EPS Next 2Y4.51%
EPS Next 3Y6.35%
EPS Next 5Y5.62%
Revenue Next Year0.53%
Revenue Next 2Y3.21%
Revenue Next 3Y3.94%
Revenue Next 5YN/A
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 decreasing.
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
With a Price/Earnings ratio of 22.55, AIT is valued on the expensive side.
AIT's Price/Earnings is on the same level as the industry average.
When comparing the Price/Earnings ratio of AIT to the average of the S&P500 Index (26.69), we can say AIT is valued inline with the index average.
A Price/Forward Earnings ratio of 20.92 indicates a rather expensive valuation of AIT.
60.42% of the companies in the same industry are cheaper than AIT, based on the Price/Forward Earnings ratio.
Compared to an average S&P500 Price/Forward Earnings ratio of 21.29, AIT is valued at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.55 | ||
| Fwd PE | 20.92 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of AIT indicates a slightly more expensive valuation: AIT is more expensive than 60.42% of the companies listed in the same industry.
Based on the Price/Free Cash Flow ratio, AIT is valued a bit cheaper than 70.83% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 19.49 | ||
| EV/EBITDA | 16.37 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
AIT has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)9.9
PEG (5Y)1.37
EPS Next 2Y4.51%
EPS Next 3Y6.35%
5. Dividend
5.1 Amount
With a yearly dividend of 0.81%, AIT is not a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 3.41, AIT has a dividend in line with its industry peers.
Compared to an average S&P500 Dividend Yield of 2.43, AIT's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.81% |
5.2 History
The dividend of AIT has a limited annual growth rate of 3.44%.
AIT has been paying a dividend for at least 10 years, so it has a reliable track record.
AIT has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)3.44%
Div Incr Years15
Div Non Decr Years34
5.3 Sustainability
15.57% of the earnings are spent on dividend by AIT. This is a low number and sustainable payout ratio.
AIT's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP15.57%
EPS Next 2Y4.51%
EPS Next 3Y6.35%
224.6
-10.29 (-4.38%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryTrading Companies & Distributors
Earnings (Last)
Earnings (Next)
Inst Owners97.8%
Inst Owner Change3.01%
Ins Owners0.87%
Ins Owner Change-0.75%
Market Cap8.55B
Analysts83.33
Price Target283.41 (26.18%)
Short Float %2.93%
Short Ratio2.71
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.81% |
Yearly Dividend1.45
Dividend Growth(5Y)3.44%
DP15.57%
Div Incr Years15
Div Non Decr Years34
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)6.24%
Min EPS beat(2)5.58%
Max EPS beat(2)6.89%
EPS beat(4)4
Avg EPS beat(4)5.11%
Min EPS beat(4)3.74%
Max EPS beat(4)6.89%
EPS beat(8)8
Avg EPS beat(8)6.51%
EPS beat(12)12
Avg EPS beat(12)10.59%
EPS beat(16)16
Avg EPS beat(16)13.21%
Revenue beat(2)0
Avg Revenue beat(2)-1.37%
Min Revenue beat(2)-1.46%
Max Revenue beat(2)-1.29%
Revenue beat(4)0
Avg Revenue beat(4)-1.49%
Min Revenue beat(4)-3.03%
Max Revenue beat(4)-0.19%
Revenue beat(8)3
Avg Revenue beat(8)-0.48%
Revenue beat(12)7
Avg Revenue beat(12)1.34%
Revenue beat(16)11
Avg Revenue beat(16)1.81%
PT rev (1m)0%
PT rev (3m)-6.94%
EPS NQ rev (1m)-0.8%
EPS NQ rev (3m)-4.13%
EPS NY rev (1m)0.16%
EPS NY rev (3m)0.27%
Revenue NQ rev (1m)-0.41%
Revenue NQ rev (3m)-3.22%
Revenue NY rev (1m)-0.26%
Revenue NY rev (3m)-0.91%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.55 | ||
| Fwd PE | 20.92 | ||
| P/S | 1.9 | ||
| P/FCF | 19.49 | ||
| P/OCF | 18.41 | ||
| P/B | 4.68 | ||
| P/tB | 10.93 | ||
| EV/EBITDA | 16.37 |
EPS(TTM)9.96
EY4.43%
EPS(NY)10.74
Fwd EY4.78%
FCF(TTM)11.52
FCFY5.13%
OCF(TTM)12.2
OCFY5.43%
SpS118.16
BVpS47.99
TBVpS20.54
PEG (NY)9.9
PEG (5Y)1.37
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 12.47% | ||
| ROE | 21.27% | ||
| ROCE | 19.03% | ||
| ROIC | 14.71% | ||
| ROICexc | 16.97% | ||
| ROICexgc | 31.24% | ||
| OM | 11.17% | ||
| PM (TTM) | 8.64% | ||
| GM | 30.33% | ||
| FCFM | 9.75% |
ROA(3y)12.07%
ROA(5y)8.73%
ROE(3y)23%
ROE(5y)17.48%
ROIC(3y)15.46%
ROIC(5y)13.38%
ROICexc(3y)18.18%
ROICexc(5y)15.7%
ROICexgc(3y)32.67%
ROICexgc(5y)30.06%
ROCE(3y)20.01%
ROCE(5y)17.32%
ROICexcg growth 3Y7.79%
ROICexcg growth 5Y4.83%
ROICexc growth 3Y14.57%
ROICexc growth 5Y10.87%
OM growth 3Y10.87%
OM growth 5Y7.5%
PM growth 3Y24.39%
PM growth 5Y15.74%
GM growth 3Y0.8%
GM growth 5Y0.55%
F-Score6
Asset Turnover1.44
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.31 | ||
| Debt/FCF | 1.3 | ||
| Debt/EBITDA | 1.02 | ||
| Cap/Depr | 45.27% | ||
| Cap/Sales | 0.57% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 82.99% | ||
| Profit Quality | 112.9% | ||
| Current Ratio | 3.57 | ||
| Quick Ratio | 2.51 | ||
| Altman-Z | 7.68 |
F-Score6
WACC9.95%
ROIC/WACC1.48
Cap/Depr(3y)43.72%
Cap/Depr(5y)38.4%
Cap/Sales(3y)0.54%
Cap/Sales(5y)0.55%
Profit Quality(3y)82.42%
Profit Quality(5y)311.14%
High Growth Momentum
Growth
EPS 1Y (TTM)4.4%
EPS 3Y28.07%
EPS 5Y16.45%
EPS Q2Q%3.63%
EPS Next Y2.28%
EPS Next 2Y4.51%
EPS Next 3Y6.35%
EPS Next 5Y5.62%
Revenue 1Y (TTM)0.5%
Revenue growth 3Y11.45%
Revenue growth 5Y5.22%
Sales Q2Q%1.78%
Revenue Next Year0.53%
Revenue Next 2Y3.21%
Revenue Next 3Y3.94%
Revenue Next 5YN/A
EBIT growth 1Y4.03%
EBIT growth 3Y23.57%
EBIT growth 5Y13.12%
EBIT Next Year14.5%
EBIT Next 3Y11.05%
EBIT Next 5YN/A
FCF growth 1Y130.2%
FCF growth 3Y15.35%
FCF growth 5Y16.48%
OCF growth 1Y113.3%
OCF growth 3Y15.39%
OCF growth 5Y15.51%