AIR PRODUCTS & CHEMICALS INC (APD) Stock Fundamental Analysis
NYSE:APD - New York Stock Exchange, Inc. - US0091581068 - Common Stock - Currency: USD
We assign a fundamental rating of 4 out of 10 to APD. APD was compared to 85 industry peers in the Chemicals industry. APD has an excellent profitability rating, but there are concerns on its financial health. APD is valied quite expensively at the moment, while it does show a decent growth rate.
1. Profitability
1.1 Basic Checks
APD had positive earnings in the past year.
In the past year APD had a positive cash flow from operations.
Each year in the past 5 years APD has been profitable.
Each year in the past 5 years APD had a positive operating cash flow.
1.2 Ratios
With an excellent Return On Assets value of 9.59%, APD belongs to the best of the industry, outperforming 94.12% of the companies in the same industry.
With an excellent Return On Equity value of 22.98%, APD belongs to the best of the industry, outperforming 91.76% of the companies in the same industry.
With a decent Return On Invested Capital value of 6.74%, APD is doing good in the industry, outperforming 69.41% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for APD is in line with the industry average of 7.10%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 9.59% | ||
| ROE | 22.98% | ||
| ROIC | 6.74% |
ROA(3y)8.39%
ROA(5y)8.09%
ROE(3y)18.57%
ROE(5y)17.37%
ROIC(3y)7.56%
ROIC(5y)7.62%
1.3 Margins
Looking at the Profit Margin, with a value of 31.88%, APD belongs to the top of the industry, outperforming 100.00% of the companies in the same industry.
In the last couple of years the Profit Margin of APD has grown nicely.
APD has a Operating Margin of 24.48%. This is amongst the best in the industry. APD outperforms 92.94% of its industry peers.
In the last couple of years the Operating Margin of APD has remained more or less at the same level.
Looking at the Gross Margin, with a value of 32.55%, APD is in the better half of the industry, outperforming 62.35% of the companies in the same industry.
APD's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 24.48% | ||
| PM (TTM) | 31.88% | ||
| GM | 32.55% |
OM growth 3Y3.42%
OM growth 5Y-0.02%
PM growth 3Y15.88%
PM growth 5Y9.9%
GM growth 3Y2.26%
GM growth 5Y-0.31%
2. Health
2.1 Basic Checks
APD has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
The number of shares outstanding for APD remains at a similar level compared to 1 year ago.
APD has more shares outstanding than it did 5 years ago.
The debt/assets ratio for APD is higher compared to a year ago.
2.2 Solvency
APD has an Altman-Z score of 2.80. This is not the best score and indicates that APD is in the grey zone with still only limited risk for bankruptcy at the moment.
APD's Altman-Z score of 2.80 is amongst the best of the industry. APD outperforms 81.18% of its industry peers.
APD has a Debt/Equity ratio of 0.80. This is a neutral value indicating APD is somewhat dependend on debt financing.
APD has a worse Debt to Equity ratio (0.80) than 60.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.8 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 2.8 |
ROIC/WACC0.85
WACC7.89%
2.3 Liquidity
APD has a Current Ratio of 1.11. This is a normal value and indicates that APD is financially healthy and should not expect problems in meeting its short term obligations.
APD's Current ratio of 1.11 is on the low side compared to the rest of the industry. APD is outperformed by 82.35% of its industry peers.
A Quick Ratio of 0.96 indicates that APD may have some problems paying its short term obligations.
APD has a Quick ratio (0.96) which is in line with its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.11 | ||
| Quick Ratio | 0.96 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 6.67% over the past year.
Measured over the past years, APD shows a quite strong growth in Earnings Per Share. The EPS has been growing by 8.62% on average per year.
The Revenue has decreased by -3.12% in the past year.
APD shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 6.29% yearly.
EPS 1Y (TTM)6.67%
EPS 3Y11.28%
EPS 5Y8.62%
EPS Q2Q%1.42%
Revenue 1Y (TTM)-3.12%
Revenue growth 3Y5.44%
Revenue growth 5Y6.29%
Sales Q2Q%-2.2%
3.2 Future
The Earnings Per Share is expected to grow by 7.92% on average over the next years.
The Revenue is expected to grow by 6.76% on average over the next years.
EPS Next Y1.97%
EPS Next 2Y5.75%
EPS Next 3Y7.72%
EPS Next 5Y7.92%
Revenue Next Year-0.46%
Revenue Next 2Y2.92%
Revenue Next 3Y4.8%
Revenue Next 5Y6.76%
3.3 Evolution
The EPS growth rate is stable: in the next years the growth will be about the same than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 21.74, the valuation of APD can be described as rather expensive.
APD's Price/Earnings ratio is in line with the industry average.
When comparing the Price/Earnings ratio of APD to the average of the S&P500 Index (28.88), we can say APD is valued slightly cheaper.
APD is valuated rather expensively with a Price/Forward Earnings ratio of 19.50.
APD's Price/Forward Earnings ratio is in line with the industry average.
Compared to an average S&P500 Price/Forward Earnings ratio of 21.20, APD is valued at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 21.74 | ||
| Fwd PE | 19.5 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, APD is valued a bit more expensive than the industry average as 65.88% of the companies are valued more cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 16.44 |
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 excellent profitability rating of APD may justify a higher PE ratio.
PEG (NY)11.01
PEG (5Y)2.52
EPS Next 2Y5.75%
EPS Next 3Y7.72%
5. Dividend
5.1 Amount
APD has a Yearly Dividend Yield of 2.66%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 3.80, APD pays a bit more dividend than its industry peers.
Compared to an average S&P500 Dividend Yield of 2.45, APD has a dividend comparable with the average S&P500 company.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.66% |
5.2 History
On average, the dividend of APD grows each year by 9.29%, which is quite nice.
APD has paid a dividend for at least 10 years, which is a reliable track record.
APD has not decreased its dividend in the past 5 years, so it has a somewhat stable track record.
Dividend Growth(5Y)9.29%
Div Incr Years6
Div Non Decr Years6
5.3 Sustainability
APD pays out 40.91% of its income as dividend. This is a bit on the high side, but may be sustainable.
APD's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP40.91%
EPS Next 2Y5.75%
EPS Next 3Y7.72%
271.09
+0.16 (+0.06%)
Chartmill FA Rating
GICS SectorMaterials
GICS IndustryGroupMaterials
GICS IndustryChemicals
Earnings (Last)
Earnings (Next)
Inst Owners90.78%
Inst Owner Change0.59%
Ins Owners0.04%
Ins Owner Change1.44%
Market Cap60.31B
Analysts75.86
Price Target339.03 (25.06%)
Short Float %1.7%
Short Ratio3.02
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.66% |
Yearly Dividend7.04
Dividend Growth(5Y)9.29%
DP40.91%
Div Incr Years6
Div Non Decr Years6
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)0.34%
Min EPS beat(2)-0.56%
Max EPS beat(2)1.25%
EPS beat(4)3
Avg EPS beat(4)2.46%
Min EPS beat(4)-0.56%
Max EPS beat(4)4.72%
EPS beat(8)6
Avg EPS beat(8)0.84%
EPS beat(12)8
Avg EPS beat(12)0.56%
EPS beat(16)8
Avg EPS beat(16)-0.01%
Revenue beat(2)0
Avg Revenue beat(2)-1.52%
Min Revenue beat(2)-1.8%
Max Revenue beat(2)-1.23%
Revenue beat(4)0
Avg Revenue beat(4)-2.61%
Min Revenue beat(4)-4.8%
Max Revenue beat(4)-1.23%
Revenue beat(8)1
Avg Revenue beat(8)-3.53%
Revenue beat(12)3
Avg Revenue beat(12)-1.75%
Revenue beat(16)7
Avg Revenue beat(16)0.08%
PT rev (1m)-6.43%
PT rev (3m)-4.32%
EPS NQ rev (1m)0.02%
EPS NQ rev (3m)-7.27%
EPS NY rev (1m)-0.81%
EPS NY rev (3m)-2.27%
Revenue NQ rev (1m)-0.1%
Revenue NQ rev (3m)-2.48%
Revenue NY rev (1m)-0.2%
Revenue NY rev (3m)-1.49%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 21.74 | ||
| Fwd PE | 19.5 | ||
| P/S | 5.01 | ||
| P/FCF | N/A | ||
| P/OCF | 15.74 | ||
| P/B | 3.61 | ||
| P/tB | 3.88 | ||
| EV/EBITDA | 16.44 |
EPS(TTM)12.47
EY4.6%
EPS(NY)13.9
Fwd EY5.13%
FCF(TTM)-16.35
FCFYN/A
OCF(TTM)17.22
OCFY6.35%
SpS54.09
BVpS75.03
TBVpS69.84
PEG (NY)11.01
PEG (5Y)2.52
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 9.59% | ||
| ROE | 22.98% | ||
| ROCE | 8.37% | ||
| ROIC | 6.74% | ||
| ROICexc | 7.13% | ||
| ROICexgc | 7.39% | ||
| OM | 24.48% | ||
| PM (TTM) | 31.88% | ||
| GM | 32.55% | ||
| FCFM | N/A |
ROA(3y)8.39%
ROA(5y)8.09%
ROE(3y)18.57%
ROE(5y)17.37%
ROIC(3y)7.56%
ROIC(5y)7.62%
ROICexc(3y)8.39%
ROICexc(5y)9.21%
ROICexgc(3y)8.81%
ROICexgc(5y)9.81%
ROCE(3y)9.41%
ROCE(5y)9.47%
ROICexcg growth 3Y-11.13%
ROICexcg growth 5Y-10.1%
ROICexc growth 3Y-10.01%
ROICexc growth 5Y-9.24%
OM growth 3Y3.42%
OM growth 5Y-0.02%
PM growth 3Y15.88%
PM growth 5Y9.9%
GM growth 3Y2.26%
GM growth 5Y-0.31%
F-Score5
Asset Turnover0.3
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.8 | ||
| Debt/FCF | N/A | ||
| Debt/EBITDA | 3.02 | ||
| Cap/Depr | 508.53% | ||
| Cap/Sales | 62.06% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 86.79% | ||
| Profit Quality | N/A | ||
| Current Ratio | 1.11 | ||
| Quick Ratio | 0.96 | ||
| Altman-Z | 2.8 |
F-Score5
WACC7.89%
ROIC/WACC0.85
Cap/Depr(3y)342.56%
Cap/Depr(5y)285.18%
Cap/Sales(3y)38.64%
Cap/Sales(5y)33.63%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)6.67%
EPS 3Y11.28%
EPS 5Y8.62%
EPS Q2Q%1.42%
EPS Next Y1.97%
EPS Next 2Y5.75%
EPS Next 3Y7.72%
EPS Next 5Y7.92%
Revenue 1Y (TTM)-3.12%
Revenue growth 3Y5.44%
Revenue growth 5Y6.29%
Sales Q2Q%-2.2%
Revenue Next Year-0.46%
Revenue Next 2Y2.92%
Revenue Next 3Y4.8%
Revenue Next 5Y6.76%
EBIT growth 1Y6.98%
EBIT growth 3Y9.05%
EBIT growth 5Y6.27%
EBIT Next Year72.27%
EBIT Next 3Y27.2%
EBIT Next 5Y20.12%
FCF growth 1Y-5496.14%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y21.09%
OCF growth 3Y2.95%
OCF growth 5Y4.19%