ALLETE INC (ALE) Stock Fundamental Analysis
USA - NYSE:ALE - US0185223007 - Common Stock
64 USD
-0.09 (-0.14%)
64 USD
0 (0%)
Taking everything into account, ALE scores 3 out of 10 in our fundamental rating. ALE was compared to 48 industry peers in the Electric Utilities industry. ALE has a medium profitability rating, but doesn't score so well on its financial health evaluation. ALE is valued expensive and it does not seem to be growing. Finally ALE also has an excellent dividend rating.
1. Profitability
1.1 Basic Checks
ALE had positive earnings in the past year.
In the past year ALE had a positive cash flow from operations.
Each year in the past 5 years ALE has been profitable.
ALE had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
ALE has a Return On Assets of 2.66%. This is comparable to the rest of the industry: ALE outperforms 43.75% of its industry peers.
ALE has a Return On Equity of 6.42%. This is amonst the worse of the industry: ALE underperforms 85.42% of its industry peers.
ALE's Return On Invested Capital of 2.15% is on the low side compared to the rest of the industry. ALE is outperformed by 89.58% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for ALE is below the industry average of 5.43%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.66% | ||
| ROE | 6.42% | ||
| ROIC | 2.15% |
ROA(3y)3.04%
ROA(5y)2.9%
ROE(3y)7.37%
ROE(5y)7.27%
ROIC(3y)2.33%
ROIC(5y)2.36%
1.3 Margins
Looking at the Profit Margin, with a value of 11.98%, ALE is in line with its industry, outperforming 43.75% of the companies in the same industry.
ALE's Profit Margin has declined in the last couple of years.
ALE's Operating Margin of 10.08% is on the low side compared to the rest of the industry. ALE is outperformed by 85.42% of its industry peers.
In the last couple of years the Operating Margin of ALE has declined.
ALE's Gross Margin of 92.03% is amongst the best of the industry. ALE outperforms 95.83% of its industry peers.
ALE's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 10.08% | ||
| PM (TTM) | 11.98% | ||
| GM | 92.03% |
OM growth 3Y-0.62%
OM growth 5Y-6.31%
PM growth 3Y-0.57%
PM growth 5Y-4.77%
GM growth 3Y-1.28%
GM growth 5Y-0.42%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so ALE is destroying value.
Compared to 1 year ago, ALE has more shares outstanding
Compared to 5 years ago, ALE has more shares outstanding
Compared to 1 year ago, ALE has an improved debt to assets ratio.
2.2 Solvency
Based on the Altman-Z score of 1.08, we must say that ALE is in the distress zone and has some risk of bankruptcy.
ALE has a better Altman-Z score (1.08) than 64.58% of its industry peers.
A Debt/Equity ratio of 0.68 indicates that ALE is somewhat dependend on debt financing.
ALE has a Debt to Equity ratio of 0.68. This is in the better half of the industry: ALE outperforms 66.67% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.68 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 1.08 |
ROIC/WACC0.3
WACC7.16%
2.3 Liquidity
A Current Ratio of 1.34 indicates that ALE should not have too much problems paying its short term obligations.
ALE has a better Current ratio (1.34) than 72.92% of its industry peers.
ALE has a Quick Ratio of 1.34. This is a bad value and indicates that ALE is not financially healthy enough and could expect problems in meeting its short term obligations.
ALE has a Quick ratio (0.81) which is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.34 | ||
| Quick Ratio | 0.81 |
3. Growth
3.1 Past
The earnings per share for ALE have decreased strongly by -17.23% in the last year.
The Earnings Per Share has been decreasing by -2.89% on average over the past years.
Looking at the last year, ALE shows a decrease in Revenue. The Revenue has decreased by -0.44% in the last year.
ALE shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 4.28% yearly.
EPS 1Y (TTM)-17.23%
EPS 3Y-1.36%
EPS 5Y-2.89%
EPS Q2Q%-3.51%
Revenue 1Y (TTM)-0.44%
Revenue growth 3Y2.53%
Revenue growth 5Y4.28%
Sales Q2Q%1.64%
3.2 Future
ALE is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 11.96% yearly.
ALE is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 5.14% yearly.
EPS Next Y18.92%
EPS Next 2Y14.02%
EPS Next 3Y15.1%
EPS Next 5Y11.96%
Revenue Next Year-1.51%
Revenue Next 2Y2%
Revenue Next 3Y3.82%
Revenue Next 5Y5.14%
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
ALE is valuated rather expensively with a Price/Earnings ratio of 20.19.
Based on the Price/Earnings ratio, ALE is valued a bit more expensive than the industry average as 70.83% of the companies are valued more cheaply.
ALE's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 27.38.
With a Price/Forward Earnings ratio of 15.88, ALE is valued correctly.
Compared to the rest of the industry, the Price/Forward Earnings ratio of ALE is on the same level as its industry peers.
Compared to an average S&P500 Price/Forward Earnings ratio of 22.86, ALE is valued a bit cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 20.19 | ||
| Fwd PE | 15.88 |
4.2 Price Multiples
ALE's Enterprise Value to EBITDA ratio is a bit more expensive when compared to the industry. ALE is more expensive than 64.58% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 12.72 |
4.3 Compensation for Growth
ALE's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
A more expensive valuation may be justified as ALE's earnings are expected to grow with 15.10% in the coming years.
PEG (NY)1.07
PEG (5Y)N/A
EPS Next 2Y14.02%
EPS Next 3Y15.1%
5. Dividend
5.1 Amount
ALE has a Yearly Dividend Yield of 4.56%, which is a nice return.
Compared to an average industry Dividend Yield of 3.77, ALE pays a bit more dividend than its industry peers.
Compared to an average S&P500 Dividend Yield of 2.38, ALE pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.56% |
5.2 History
The dividend of ALE has a limited annual growth rate of 3.68%.
ALE has paid a dividend for at least 10 years, which is a reliable track record.
ALE has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)3.68%
Div Incr Years14
Div Non Decr Years19
5.3 Sustainability
90.47% of the earnings are spent on dividend by ALE. This is not a sustainable payout ratio.
The dividend of ALE is growing, but earnings are growing more, so the dividend growth is sustainable.
DP90.47%
EPS Next 2Y14.02%
EPS Next 3Y15.1%
64
-0.09 (-0.14%)
Chartmill FA Rating
GICS SectorUtilities
GICS IndustryGroupUtilities
GICS IndustryElectric Utilities
Earnings (Last)
Earnings (Next)
Inst Owners74.54%
Inst Owner Change1.73%
Ins Owners0.27%
Ins Owner Change2.7%
Market Cap3.71B
Analysts80
Price Target70.67 (10.42%)
Short Float %1.64%
Short Ratio1.52
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.56% |
Yearly Dividend2.82
Dividend Growth(5Y)3.68%
DP90.47%
Div Incr Years14
Div Non Decr Years19
Ex-Date
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-22.35%
Min EPS beat(2)-37.05%
Max EPS beat(2)-7.65%
EPS beat(4)0
Avg EPS beat(4)-21.03%
Min EPS beat(4)-37.05%
Max EPS beat(4)-7.65%
EPS beat(8)1
Avg EPS beat(8)-2.12%
EPS beat(12)2
Avg EPS beat(12)-5.43%
EPS beat(16)4
Avg EPS beat(16)-4.14%
Revenue beat(2)0
Avg Revenue beat(2)-14.64%
Min Revenue beat(2)-16.12%
Max Revenue beat(2)-13.16%
Revenue beat(4)1
Avg Revenue beat(4)-9.73%
Min Revenue beat(4)-16.12%
Max Revenue beat(4)3.11%
Revenue beat(8)1
Avg Revenue beat(8)-13.44%
Revenue beat(12)5
Avg Revenue beat(12)-2.88%
Revenue beat(16)9
Avg Revenue beat(16)0.95%
PT rev (1m)0.83%
PT rev (3m)4.71%
EPS NQ rev (1m)0%
EPS NQ rev (3m)2.13%
EPS NY rev (1m)0%
EPS NY rev (3m)-5.03%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0%
Revenue NY rev (1m)0%
Revenue NY rev (3m)0%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 20.19 | ||
| Fwd PE | 15.88 | ||
| P/S | 2.42 | ||
| P/FCF | N/A | ||
| P/OCF | 8.63 | ||
| P/B | 1.3 | ||
| P/tB | 1.37 | ||
| EV/EBITDA | 12.72 |
EPS(TTM)3.17
EY4.95%
EPS(NY)4.03
Fwd EY6.3%
FCF(TTM)-0.92
FCFYN/A
OCF(TTM)7.41
OCFY11.58%
SpS26.4
BVpS49.31
TBVpS46.63
PEG (NY)1.07
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.66% | ||
| ROE | 6.42% | ||
| ROCE | 2.35% | ||
| ROIC | 2.15% | ||
| ROICexc | 2.16% | ||
| ROICexgc | 2.22% | ||
| OM | 10.08% | ||
| PM (TTM) | 11.98% | ||
| GM | 92.03% | ||
| FCFM | N/A |
ROA(3y)3.04%
ROA(5y)2.9%
ROE(3y)7.37%
ROE(5y)7.27%
ROIC(3y)2.33%
ROIC(5y)2.36%
ROICexc(3y)2.34%
ROICexc(5y)2.38%
ROICexgc(3y)2.4%
ROICexgc(5y)2.41%
ROCE(3y)2.55%
ROCE(5y)2.58%
ROICexcg growth 3Y0.06%
ROICexcg growth 5Y-6.66%
ROICexc growth 3Y-0.77%
ROICexc growth 5Y-7.11%
OM growth 3Y-0.62%
OM growth 5Y-6.31%
PM growth 3Y-0.57%
PM growth 5Y-4.77%
GM growth 3Y-1.28%
GM growth 5Y-0.42%
F-Score4
Asset Turnover0.22
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.68 | ||
| Debt/FCF | N/A | ||
| Debt/EBITDA | 4.34 | ||
| Cap/Depr | 166.59% | ||
| Cap/Sales | 31.56% | ||
| Interest Coverage | 1.96 | ||
| Cash Conversion | 96.74% | ||
| Profit Quality | N/A | ||
| Current Ratio | 1.34 | ||
| Quick Ratio | 0.81 | ||
| Altman-Z | 1.08 |
F-Score4
WACC7.16%
ROIC/WACC0.3
Cap/Depr(3y)106.82%
Cap/Depr(5y)166.23%
Cap/Sales(3y)17.22%
Cap/Sales(5y)29.28%
Profit Quality(3y)61.51%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-17.23%
EPS 3Y-1.36%
EPS 5Y-2.89%
EPS Q2Q%-3.51%
EPS Next Y18.92%
EPS Next 2Y14.02%
EPS Next 3Y15.1%
EPS Next 5Y11.96%
Revenue 1Y (TTM)-0.44%
Revenue growth 3Y2.53%
Revenue growth 5Y4.28%
Sales Q2Q%1.64%
Revenue Next Year-1.51%
Revenue Next 2Y2%
Revenue Next 3Y3.82%
Revenue Next 5Y5.14%
EBIT growth 1Y-0.9%
EBIT growth 3Y1.9%
EBIT growth 5Y-2.29%
EBIT Next Year158.47%
EBIT Next 3Y53.28%
EBIT Next 5Y37.33%
FCF growth 1Y-117.26%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y-23.29%
OCF growth 3Y20.16%
OCF growth 5Y12.87%