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 189 industry peers in the Health Care Equipment & Supplies industry. ALC has an excellent profitability rating, but there are some minor concerns on its financial health. ALC has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
In the past year ALC was profitable.
In the past year ALC had a positive cash flow from operations.
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 79.89% of the companies in the same industry.
ALC's Return On Equity of 5.09% is fine compared to the rest of the industry. ALC outperforms 79.37% of its industry peers.
Looking at the Return On Invested Capital, with a value of 3.93%, ALC is in the better half of the industry, outperforming 74.60% of the companies in the same industry.
ALC had an Average Return On Invested Capital over the past 3 years of 3.01%. This is below the industry average of 7.87%.
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
The Profit Margin of ALC (11.28%) is better than 86.24% of its industry peers.
In the last couple of years the Profit Margin of ALC has grown nicely.
The Operating Margin of ALC (14.07%) is better than 82.54% of its industry peers.
ALC's Operating Margin has improved in the last couple of years.
ALC has a Gross Margin (54.25%) which is comparable to the rest of the industry.
ALC's Gross Margin has improved in the last couple of years.
| 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
ALC has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
ALC has more shares outstanding than it did 1 year ago.
Compared to 5 years ago, ALC has more shares outstanding
ALC has a better debt/assets ratio than last year.
2.2 Solvency
An Altman-Z score of 4.55 indicates that ALC is not in any danger for bankruptcy at the moment.
The Altman-Z score of ALC (4.55) is better than 76.72% 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 86.24% of the companies in the same industry.
A Debt/Equity ratio of 0.23 indicates that ALC is not too dependend on debt financing.
ALC has a Debt to Equity ratio (0.23) which is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.23 | ||
| Debt/FCF | 3.58 | ||
| Altman-Z | 4.55 |
ROIC/WACC0.83
WACC4.75%
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 (2.70) which is comparable to the rest of the industry.
A Quick Ratio of 1.66 indicates that ALC should not have too much problems paying its short term obligations.
Looking at the Quick ratio, with a value of 1.66, ALC is in line with its industry, outperforming 43.39% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.7 | ||
| Quick Ratio | 1.66 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 11.31% over the past year.
Measured over the past years, ALC shows a quite strong growth in Earnings Per Share. The EPS has been growing by 10.04% on average per year.
Looking at the last year, ALC shows a small growth in Revenue. The Revenue has grown by 3.80% in the last year.
Measured over the past years, ALC shows a small growth in Revenue. The Revenue has been growing by 5.71% on average per year.
EPS 1Y (TTM)11.31%
EPS 3Y12.36%
EPS 5Y10.04%
EPS Q2Q%40.73%
Revenue 1Y (TTM)3.8%
Revenue growth 3Y6.13%
Revenue growth 5Y5.71%
Sales Q2Q%1.19%
3.2 Future
Based on estimates for the next years, ALC will show a quite strong growth in Earnings Per Share. The EPS will grow by 12.42% on average per year.
ALC is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 6.58% yearly.
EPS Next Y8.02%
EPS Next 2Y11.99%
EPS Next 3Y12.14%
EPS Next 5Y12.42%
Revenue Next Year5.62%
Revenue Next 2Y6.39%
Revenue Next 3Y6.33%
Revenue Next 5Y6.58%
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 stable: in the next years the growth will be about the same than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
ALC is valuated quite expensively with a Price/Earnings ratio of 28.70.
75.66% of the companies in the same industry are more expensive than ALC, based on the Price/Earnings ratio.
ALC's Price/Earnings ratio indicates a similar valuation than the S&P500 average which is at 26.03.
ALC is valuated rather expensively with a Price/Forward Earnings ratio of 22.88.
Based on the Price/Forward Earnings ratio, ALC is valued a bit cheaper than the industry average as 77.78% of the companies are valued more expensively.
The average S&P500 Price/Forward Earnings ratio is at 21.94. ALC is around the same levels.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 28.7 | ||
| Fwd PE | 22.88 |
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 77.25% of the companies listed in the same industry.
Based on the Price/Free Cash Flow ratio, ALC is valued cheaper than 82.01% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 30.11 | ||
| EV/EBITDA | 18.12 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates ALC does not grow enough to justify the current Price/Earnings ratio.
ALC has a very decent profitability rating, which may justify a higher PE ratio.
ALC's earnings are expected to grow with 12.14% in the coming years. This may justify a more expensive valuation.
PEG (NY)3.58
PEG (5Y)2.86
EPS Next 2Y11.99%
EPS Next 3Y12.14%
5. Dividend
5.1 Amount
With a yearly dividend of 0.38%, ALC is not a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 1.82, ALC pays a better dividend. On top of this ALC pays more dividend than 91.01% of the companies listed in the same industry.
With a Dividend Yield of 0.38, ALC pays less dividend than the S&P500 average, which is at 2.36.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.38% |
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%
87.54
-0.53 (-0.6%)
Chartmill FA Rating
GICS SectorHealth Care
GICS IndustryGroupHealth Care Equipment & Services
GICS IndustryHealth Care Equipment & Supplies
Earnings (Last)
Earnings (Next)
Inst Owners69.58%
Inst Owner Change-6.2%
Ins Owners0.12%
Ins Owner ChangeN/A
Market Cap43.74B
Analysts81.74
Price Target113.83 (30.03%)
Short Float %0.83%
Short Ratio2.58
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.38% |
Yearly Dividend0.26
Dividend Growth(5Y)N/A
DP11.61%
Div Incr Years1
Div Non Decr Years1
Ex-Date
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)-1.56%
Min Revenue beat(2)-2.56%
Max Revenue beat(2)-0.56%
Revenue beat(4)0
Avg Revenue beat(4)-2.13%
Min Revenue beat(4)-2.97%
Max Revenue beat(4)-0.56%
Revenue beat(8)1
Avg Revenue beat(8)-1.8%
Revenue beat(12)2
Avg Revenue beat(12)-1.15%
Revenue beat(16)6
Avg Revenue beat(16)0.13%
PT rev (1m)3.45%
PT rev (3m)10.24%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-6.61%
EPS NY rev (1m)0%
EPS NY rev (3m)-3.12%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-1.89%
Revenue NY rev (1m)0.03%
Revenue NY rev (3m)-0.72%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 28.7 | ||
| Fwd PE | 22.88 | ||
| P/S | 4.41 | ||
| P/FCF | 30.11 | ||
| P/OCF | 20.63 | ||
| P/B | 1.99 | ||
| P/tB | 12.7 | ||
| EV/EBITDA | 18.12 |
EPS(TTM)3.05
EY3.48%
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)3.58
PEG (5Y)2.86
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 | 4.55 |
F-Score6
WACC4.75%
ROIC/WACC0.83
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)11.31%
EPS 3Y12.36%
EPS 5Y10.04%
EPS Q2Q%40.73%
EPS Next Y8.02%
EPS Next 2Y11.99%
EPS Next 3Y12.14%
EPS Next 5Y12.42%
Revenue 1Y (TTM)3.8%
Revenue growth 3Y6.13%
Revenue growth 5Y5.71%
Sales Q2Q%1.19%
Revenue Next Year5.62%
Revenue Next 2Y6.39%
Revenue Next 3Y6.33%
Revenue Next 5Y6.58%
EBIT growth 1Y12.13%
EBIT growth 3Y13.34%
EBIT growth 5Y43.18%
EBIT Next Year47.77%
EBIT Next 3Y21.71%
EBIT Next 5Y15.14%
FCF growth 1Y202.71%
FCF growth 3Y104.3%
FCF growth 5Y41.96%
OCF growth 1Y71.52%
OCF growth 3Y15.59%
OCF growth 5Y17.69%