ALCON INC (ALC) Stock Fundamental Analysis
NYSE:ALC - New York Stock Exchange, Inc. - CH0432492467 - Common Stock - Currency: USD
Overall ALC gets a fundamental rating of 6 out of 10. We evaluated ALC against 187 industry peers in the Health Care Equipment & Supplies industry. ALC scores excellent on profitability, but there are some minor concerns on its financial health. ALC is not valued too expensively and it also shows a decent growth rate.
1. Profitability
1.1 Basic Checks
In the past year ALC was profitable.
ALC had a positive operating cash flow in the past year.
ALC had positive earnings in 4 of the past 5 years.
In the past 5 years ALC always reported a positive cash flow from operatings.
1.2 Ratios
With a decent Return On Assets value of 3.61%, ALC is doing good in the industry, outperforming 79.68% of the companies in the same industry.
ALC has a Return On Equity of 5.09%. This is in the better half of the industry: ALC outperforms 79.68% of its industry peers.
ALC has a better Return On Invested Capital (3.93%) than 74.87% of its industry peers.
ALC had an Average Return On Invested Capital over the past 3 years of 3.01%. This is below the industry average of 7.89%.
The 3 year average ROIC (3.01%) for ALC is below the current ROIC(3.93%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.61% | ||
| ROE | 5.09% | ||
| ROIC | 3.93% |
ROA(3y)2.6%
ROA(5y)1.44%
ROE(3y)3.72%
ROE(5y)2.06%
ROIC(3y)3.01%
ROIC(5y)N/A
1.3 Margins
ALC's Profit Margin of 11.28% is amongst the best of the industry. ALC outperforms 87.17% of its industry peers.
ALC's Profit Margin has improved in the last couple of years.
Looking at the Operating Margin, with a value of 14.07%, ALC belongs to the top of the industry, outperforming 82.35% of the companies in the same industry.
ALC's Operating Margin has improved in the last couple of years.
The Gross Margin of ALC (54.25%) is comparable to the rest of the industry.
In the last couple of years the Gross Margin of ALC has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 14.07% | ||
| PM (TTM) | 11.28% | ||
| GM | 54.25% |
OM growth 3Y6.79%
OM growth 5Y35.45%
PM growth 3Y31.33%
PM growth 5YN/A
GM growth 3Y-0.59%
GM growth 5Y2.7%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), ALC is destroying value.
The number of shares outstanding for ALC has been increased compared to 1 year ago.
Compared to 5 years ago, ALC has more shares outstanding
The debt/assets ratio for ALC has been reduced compared to a year ago.
2.2 Solvency
ALC has an Altman-Z score of 4.57. This indicates that ALC is financially healthy and has little risk of bankruptcy at the moment.
ALC's Altman-Z score of 4.57 is fine compared to the rest of the industry. ALC outperforms 75.40% of its industry peers.
ALC has a debt to FCF ratio of 3.58. This is a good value and a sign of high solvency as ALC would need 3.58 years to pay back of all of its debts.
With an excellent Debt to FCF ratio value of 3.58, ALC belongs to the best of the industry, outperforming 87.17% of the companies in the same industry.
ALC has a Debt/Equity ratio of 0.23. This is a healthy value indicating a solid balance between debt and equity.
The Debt to Equity ratio of ALC (0.23) is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.23 | ||
| Debt/FCF | 3.58 | ||
| Altman-Z | 4.57 |
ROIC/WACC0.84
WACC4.69%
2.3 Liquidity
A Current Ratio of 2.70 indicates that ALC has no problem at all paying its short term obligations.
ALC has a Current ratio of 2.70. This is comparable to the rest of the industry: ALC outperforms 51.87% of its industry peers.
A Quick Ratio of 1.66 indicates that ALC should not have too much problems paying its short term obligations.
ALC has a Quick ratio (1.66) which is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.7 | ||
| Quick Ratio | 1.66 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 6.38% over the past year.
ALC shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 10.04% yearly.
The Revenue has been growing slightly by 3.80% in the past year.
The Revenue has been growing slightly by 5.71% on average over the past years.
EPS 1Y (TTM)6.38%
EPS 3Y12.36%
EPS 5Y10.04%
EPS Q2Q%-6.41%
Revenue 1Y (TTM)3.8%
Revenue growth 3Y6.13%
Revenue growth 5Y5.71%
Sales Q2Q%0.29%
3.2 Future
The Earnings Per Share is expected to grow by 12.48% on average over the next years. This is quite good.
Based on estimates for the next years, ALC will show a small growth in Revenue. The Revenue will grow by 6.95% on average per year.
EPS Next Y8.02%
EPS Next 2Y11.99%
EPS Next 3Y12.14%
EPS Next 5Y12.48%
Revenue Next Year5.62%
Revenue Next 2Y6.39%
Revenue Next 3Y6.33%
Revenue Next 5Y6.95%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
The Revenue 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
With a Price/Earnings ratio of 29.16, ALC can be considered very expensive at the moment.
Based on the Price/Earnings ratio, ALC is valued a bit cheaper than 75.94% of the companies in the same industry.
The average S&P500 Price/Earnings ratio is at 27.30. ALC is around the same levels.
The Price/Forward Earnings ratio is 22.87, which indicates a rather expensive current valuation of ALC.
Compared to the rest of the industry, the Price/Forward Earnings ratio of ALC indicates a somewhat cheap valuation: ALC is cheaper than 76.47% of the companies listed in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 21.76. ALC is around the same levels.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 29.16 | ||
| Fwd PE | 22.87 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of ALC indicates a somewhat cheap valuation: ALC is cheaper than 75.94% of the companies listed in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of ALC indicates a rather cheap valuation: ALC is cheaper than 82.89% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 30.09 | ||
| EV/EBITDA | 18.24 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
The decent profitability rating of ALC may justify a higher PE ratio.
A more expensive valuation may be justified as ALC's earnings are expected to grow with 12.14% in the coming years.
PEG (NY)3.63
PEG (5Y)2.9
EPS Next 2Y11.99%
EPS Next 3Y12.14%
5. Dividend
5.1 Amount
ALC has a yearly dividend return of 0.39%, which is pretty low.
ALC's Dividend Yield is rather good when compared to the industry average which is at 1.77. ALC pays more dividend than 90.91% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 2.37, ALC's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.39% |
5.2 History
ALC has been paying a dividend for over 5 years, so it has already some track record.
The dividend of ALC decreased recently.
Dividend Growth(5Y)N/A
Div Incr Years1
Div Non Decr Years1
5.3 Sustainability
ALC pays out 11.61% of its income as dividend. This is a sustainable payout ratio.
DP11.61%
EPS Next 2Y11.99%
EPS Next 3Y12.14%
87.48
-1.22 (-1.38%)
Chartmill FA Rating
GICS SectorHealth Care
GICS IndustryGroupHealth Care Equipment & Services
GICS IndustryHealth Care Equipment & Supplies
Earnings (Last)
Earnings (Next)
Inst Owners68.39%
Inst Owner Change0%
Ins Owners0.12%
Ins Owner ChangeN/A
Market Cap43.71B
Analysts80.91
Price Target112.26 (28.33%)
Short Float %1.06%
Short Ratio3.31
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.39% |
Yearly Dividend0.26
Dividend Growth(5Y)N/A
DP11.61%
Div Incr Years1
Div Non Decr Years1
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-1.84%
Min EPS beat(2)-4.26%
Max EPS beat(2)0.57%
EPS beat(4)3
Avg EPS beat(4)1.13%
Min EPS beat(4)-4.26%
Max EPS beat(4)7.68%
EPS beat(8)6
Avg EPS beat(8)1.96%
EPS beat(12)8
Avg EPS beat(12)2.89%
EPS beat(16)12
Avg EPS beat(16)5.61%
Revenue beat(2)0
Avg Revenue beat(2)-1.99%
Min Revenue beat(2)-3.43%
Max Revenue beat(2)-0.56%
Revenue beat(4)0
Avg Revenue beat(4)-2.34%
Min Revenue beat(4)-3.43%
Max Revenue beat(4)-0.56%
Revenue beat(8)1
Avg Revenue beat(8)-1.91%
Revenue beat(12)2
Avg Revenue beat(12)-1.23%
Revenue beat(16)6
Avg Revenue beat(16)0.08%
PT rev (1m)-1.38%
PT rev (3m)2.03%
EPS NQ rev (1m)-3.58%
EPS NQ rev (3m)-7.12%
EPS NY rev (1m)0%
EPS NY rev (3m)-0.67%
Revenue NQ rev (1m)0.61%
Revenue NQ rev (3m)1.07%
Revenue NY rev (1m)0%
Revenue NY rev (3m)0.03%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 29.16 | ||
| Fwd PE | 22.87 | ||
| P/S | 4.4 | ||
| P/FCF | 30.09 | ||
| P/OCF | 20.62 | ||
| P/B | 1.99 | ||
| P/tB | 12.69 | ||
| EV/EBITDA | 18.24 |
EPS(TTM)3
EY3.43%
EPS(NY)3.83
Fwd EY4.37%
FCF(TTM)2.91
FCFY3.32%
OCF(TTM)4.24
OCFY4.85%
SpS19.86
BVpS44.03
TBVpS6.89
PEG (NY)3.63
PEG (5Y)2.9
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.61% | ||
| ROE | 5.09% | ||
| ROCE | 4.85% | ||
| ROIC | 3.93% | ||
| ROICexc | 4.14% | ||
| ROICexgc | 12.86% | ||
| OM | 14.07% | ||
| PM (TTM) | 11.28% | ||
| GM | 54.25% | ||
| FCFM | 14.64% |
ROA(3y)2.6%
ROA(5y)1.44%
ROE(3y)3.72%
ROE(5y)2.06%
ROIC(3y)3.01%
ROIC(5y)N/A
ROICexc(3y)3.18%
ROICexc(5y)N/A
ROICexgc(3y)10.24%
ROICexgc(5y)N/A
ROCE(3y)3.72%
ROCE(5y)N/A
ROICexcg growth 3Y2.95%
ROICexcg growth 5Y30.08%
ROICexc growth 3Y10.31%
ROICexc growth 5Y41.26%
OM growth 3Y6.79%
OM growth 5Y35.45%
PM growth 3Y31.33%
PM growth 5YN/A
GM growth 3Y-0.59%
GM growth 5Y2.7%
F-Score6
Asset Turnover0.32
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.23 | ||
| Debt/FCF | 3.58 | ||
| Debt/EBITDA | 1.91 | ||
| Cap/Depr | 53.75% | ||
| Cap/Sales | 6.72% | ||
| Interest Coverage | 7.59 | ||
| Cash Conversion | 80.39% | ||
| Profit Quality | 129.73% | ||
| Current Ratio | 2.7 | ||
| Quick Ratio | 1.66 | ||
| Altman-Z | 4.57 |
F-Score6
WACC4.69%
ROIC/WACC0.84
Cap/Depr(3y)77.98%
Cap/Depr(5y)73.14%
Cap/Sales(3y)9.96%
Cap/Sales(5y)10.48%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)6.38%
EPS 3Y12.36%
EPS 5Y10.04%
EPS Q2Q%-6.41%
EPS Next Y8.02%
EPS Next 2Y11.99%
EPS Next 3Y12.14%
EPS Next 5Y12.48%
Revenue 1Y (TTM)3.8%
Revenue growth 3Y6.13%
Revenue growth 5Y5.71%
Sales Q2Q%0.29%
Revenue Next Year5.62%
Revenue Next 2Y6.39%
Revenue Next 3Y6.33%
Revenue Next 5Y6.95%
EBIT growth 1Y12.13%
EBIT growth 3Y13.34%
EBIT growth 5Y43.18%
EBIT Next Year44.89%
EBIT Next 3Y21.32%
EBIT Next 5Y15.19%
FCF growth 1Y202.71%
FCF growth 3Y104.3%
FCF growth 5Y41.96%
OCF growth 1Y71.52%
OCF growth 3Y15.59%
OCF growth 5Y17.69%