ALAMO GROUP INC (ALG) Stock Fundamental Analysis
NYSE:ALG - New York Stock Exchange, Inc. - US0113111076 - Common Stock - Currency: USD
Taking everything into account, ALG scores 6 out of 10 in our fundamental rating. ALG was compared to 128 industry peers in the Machinery industry. ALG has an excellent financial health rating, but there are some minor concerns on its profitability. ALG has a valuation in line with the averages, but on the other hand it scores bad on growth.
1. Profitability
1.1 Basic Checks
In the past year ALG was profitable.
ALG had a positive operating cash flow in the past year.
Each year in the past 5 years ALG has been profitable.
ALG had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
ALG has a better Return On Assets (7.68%) than 67.97% of its industry peers.
ALG has a Return On Equity of 10.94%. This is comparable to the rest of the industry: ALG outperforms 57.03% of its industry peers.
Looking at the Return On Invested Capital, with a value of 9.74%, ALG is in the better half of the industry, outperforming 66.41% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for ALG is in line with the industry average of 10.82%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.68% | ||
| ROE | 10.94% | ||
| ROIC | 9.74% |
ROA(3y)8.48%
ROA(5y)7.45%
ROE(3y)12.99%
ROE(5y)11.88%
ROIC(3y)11.11%
ROIC(5y)9.98%
1.3 Margins
With a Profit Margin value of 7.25%, ALG perfoms like the industry average, outperforming 59.38% of the companies in the same industry.
ALG's Profit Margin has improved in the last couple of years.
Looking at the Operating Margin, with a value of 10.18%, ALG is in line with its industry, outperforming 54.69% of the companies in the same industry.
ALG's Operating Margin has improved in the last couple of years.
The Gross Margin of ALG (25.33%) is worse than 64.06% of its industry peers.
In the last couple of years the Gross Margin of ALG has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 10.18% | ||
| PM (TTM) | 7.25% | ||
| GM | 25.33% |
OM growth 3Y4.92%
OM growth 5Y3.6%
PM growth 3Y5.8%
PM growth 5Y4.77%
GM growth 3Y0.34%
GM growth 5Y0.72%
2. Health
2.1 Basic Checks
ALG has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
ALG has more shares outstanding than it did 1 year ago.
Compared to 5 years ago, ALG has more shares outstanding
Compared to 1 year ago, ALG has an improved debt to assets ratio.
2.2 Solvency
An Altman-Z score of 6.56 indicates that ALG is not in any danger for bankruptcy at the moment.
ALG's Altman-Z score of 6.56 is amongst the best of the industry. ALG outperforms 85.94% of its industry peers.
ALG has a debt to FCF ratio of 1.09. This is a very positive value and a sign of high solvency as it would only need 1.09 years to pay back of all of its debts.
ALG's Debt to FCF ratio of 1.09 is amongst the best of the industry. ALG outperforms 84.38% of its industry peers.
ALG has a Debt/Equity ratio of 0.19. This is a healthy value indicating a solid balance between debt and equity.
ALG's Debt to Equity ratio of 0.19 is fine compared to the rest of the industry. ALG outperforms 71.09% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.19 | ||
| Debt/FCF | 1.09 | ||
| Altman-Z | 6.56 |
ROIC/WACC1.02
WACC9.59%
2.3 Liquidity
ALG has a Current Ratio of 4.30. This indicates that ALG is financially healthy and has no problem in meeting its short term obligations.
Looking at the Current ratio, with a value of 4.30, ALG belongs to the top of the industry, outperforming 88.28% of the companies in the same industry.
ALG has a Quick Ratio of 2.62. This indicates that ALG is financially healthy and has no problem in meeting its short term obligations.
ALG's Quick ratio of 2.62 is amongst the best of the industry. ALG outperforms 85.16% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 4.3 | ||
| Quick Ratio | 2.62 |
3. Growth
3.1 Past
ALG shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -14.59%.
The Earnings Per Share has been growing by 10.26% on average over the past years. This is quite good.
The Revenue has decreased by -6.43% in the past year.
Measured over the past years, ALG shows a small growth in Revenue. The Revenue has been growing by 7.79% on average per year.
EPS 1Y (TTM)-14.59%
EPS 3Y13.14%
EPS 5Y10.26%
EPS Q2Q%-1.12%
Revenue 1Y (TTM)-6.43%
Revenue growth 3Y6.87%
Revenue growth 5Y7.79%
Sales Q2Q%-8.14%
3.2 Future
The Earnings Per Share is expected to grow by 12.28% on average over the next years. This is quite good.
The Revenue is expected to grow by 1.08% on average over the next years.
EPS Next Y12.9%
EPS Next 2Y12.28%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue Next Year-1.63%
Revenue Next 2Y1.08%
Revenue Next 3YN/A
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 stable.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 23.61 indicates a rather expensive valuation of ALG.
Compared to the rest of the industry, the Price/Earnings ratio of ALG is on the same level as its industry peers.
ALG is valuated at similar levels of the S&P average when we compare the Price/Earnings ratio to 27.24, which is the current average of the S&P500 Index.
ALG is valuated rather expensively with a Price/Forward Earnings ratio of 18.67.
ALG's Price/Forward Earnings is on the same level as the industry average.
The average S&P500 Price/Forward Earnings ratio is at 36.42. ALG is valued slightly cheaper when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 23.61 | ||
| Fwd PE | 18.67 |
4.2 Price Multiples
ALG's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. ALG is cheaper than 60.16% of the companies in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of ALG indicates a rather cheap valuation: ALG is cheaper than 82.03% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 13.82 | ||
| EV/EBITDA | 12.77 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
ALG has a very decent profitability rating, which may justify a higher PE ratio.
ALG's earnings are expected to grow with 12.28% in the coming years. This may justify a more expensive valuation.
PEG (NY)1.83
PEG (5Y)2.3
EPS Next 2Y12.28%
EPS Next 3YN/A
5. Dividend
5.1 Amount
ALG has a yearly dividend return of 0.54%, which is pretty low.
ALG's Dividend Yield is comparable with the industry average which is at 1.91.
With a Dividend Yield of 0.54, ALG pays less dividend than the S&P500 average, which is at 2.40.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.54% |
5.2 History
On average, the dividend of ALG grows each year by 16.84%, which is quite nice.
ALG has been paying a dividend for at least 10 years, so it has a reliable track record.
ALG has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)16.84%
Div Incr Years10
Div Non Decr Years24
5.3 Sustainability
ALG pays out 11.19% of its income as dividend. This is a sustainable payout ratio.
The dividend of ALG is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP11.19%
EPS Next 2Y12.28%
EPS Next 3YN/A
226.63
+11.01 (+5.11%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryMachinery
Earnings (Last)
Earnings (Next)
Inst Owners86.82%
Inst Owner Change-0.78%
Ins Owners1.13%
Ins Owner Change2.08%
Market Cap2.74B
Analysts80
Price Target221.85 (-2.11%)
Short Float %3.48%
Short Ratio3.61
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.54% |
Yearly Dividend1.04
Dividend Growth(5Y)16.84%
DP11.19%
Div Incr Years10
Div Non Decr Years24
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)8.89%
Min EPS beat(2)2.42%
Max EPS beat(2)15.36%
EPS beat(4)2
Avg EPS beat(4)-1%
Min EPS beat(4)-14.4%
Max EPS beat(4)15.36%
EPS beat(8)4
Avg EPS beat(8)0.6%
EPS beat(12)7
Avg EPS beat(12)5.53%
EPS beat(16)9
Avg EPS beat(16)3.78%
Revenue beat(2)0
Avg Revenue beat(2)-2.44%
Min Revenue beat(2)-3.87%
Max Revenue beat(2)-1.02%
Revenue beat(4)0
Avg Revenue beat(4)-2.61%
Min Revenue beat(4)-3.87%
Max Revenue beat(4)-1.02%
Revenue beat(8)3
Avg Revenue beat(8)-0.6%
Revenue beat(12)6
Avg Revenue beat(12)0.3%
Revenue beat(16)9
Avg Revenue beat(16)1.15%
PT rev (1m)0%
PT rev (3m)6.88%
EPS NQ rev (1m)0%
EPS NQ rev (3m)10.66%
EPS NY rev (1m)-0.02%
EPS NY rev (3m)9.2%
Revenue NQ rev (1m)-0.88%
Revenue NQ rev (3m)-0.54%
Revenue NY rev (1m)-0.49%
Revenue NY rev (3m)-0.37%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 23.61 | ||
| Fwd PE | 18.67 | ||
| P/S | 1.72 | ||
| P/FCF | 13.82 | ||
| P/OCF | 12.29 | ||
| P/B | 2.59 | ||
| P/tB | 3.89 | ||
| EV/EBITDA | 12.77 |
EPS(TTM)9.6
EY4.24%
EPS(NY)12.14
Fwd EY5.36%
FCF(TTM)16.4
FCFY7.24%
OCF(TTM)18.43
OCFY8.13%
SpS131.83
BVpS87.43
TBVpS58.28
PEG (NY)1.83
PEG (5Y)2.3
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.68% | ||
| ROE | 10.94% | ||
| ROCE | 12.55% | ||
| ROIC | 9.74% | ||
| ROICexc | 11.53% | ||
| ROICexgc | 17.02% | ||
| OM | 10.18% | ||
| PM (TTM) | 7.25% | ||
| GM | 25.33% | ||
| FCFM | 12.44% |
ROA(3y)8.48%
ROA(5y)7.45%
ROE(3y)12.99%
ROE(5y)11.88%
ROIC(3y)11.11%
ROIC(5y)9.98%
ROICexc(3y)12.08%
ROICexc(5y)10.73%
ROICexgc(3y)18.15%
ROICexgc(5y)16.79%
ROCE(3y)14.31%
ROCE(5y)12.86%
ROICexcg growth 3Y5.21%
ROICexcg growth 5Y8.14%
ROICexc growth 3Y8.81%
ROICexc growth 5Y10.49%
OM growth 3Y4.92%
OM growth 5Y3.6%
PM growth 3Y5.8%
PM growth 5Y4.77%
GM growth 3Y0.34%
GM growth 5Y0.72%
F-Score6
Asset Turnover1.06
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.19 | ||
| Debt/FCF | 1.09 | ||
| Debt/EBITDA | 0.93 | ||
| Cap/Depr | 45.87% | ||
| Cap/Sales | 1.54% | ||
| Interest Coverage | 8.92 | ||
| Cash Conversion | 103.23% | ||
| Profit Quality | 171.5% | ||
| Current Ratio | 4.3 | ||
| Quick Ratio | 2.62 | ||
| Altman-Z | 6.56 |
F-Score6
WACC9.59%
ROIC/WACC1.02
Cap/Depr(3y)64.41%
Cap/Depr(5y)58.21%
Cap/Sales(3y)1.95%
Cap/Sales(5y)1.86%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-14.59%
EPS 3Y13.14%
EPS 5Y10.26%
EPS Q2Q%-1.12%
EPS Next Y12.9%
EPS Next 2Y12.28%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue 1Y (TTM)-6.43%
Revenue growth 3Y6.87%
Revenue growth 5Y7.79%
Sales Q2Q%-8.14%
Revenue Next Year-1.63%
Revenue Next 2Y1.08%
Revenue Next 3YN/A
Revenue Next 5YN/A
EBIT growth 1Y-17.19%
EBIT growth 3Y12.13%
EBIT growth 5Y11.67%
EBIT Next Year38.46%
EBIT Next 3YN/A
EBIT Next 5YN/A
FCF growth 1Y469.75%
FCF growth 3Y96.3%
FCF growth 5Y26.31%
OCF growth 1Y215.21%
OCF growth 3Y61.61%
OCF growth 5Y18.76%