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ARGAN (ARG.PA) Stock Fundamental Analysis

EPA:ARG - Euronext Paris - Matif - FR0010481960 - REIT - Currency: EUR

61  -4.1 (-6.3%)

Fundamental Rating

5

ARG gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 41 industry peers in the Diversified REITs industry. While ARG is still in line with the averages on profitability rating, there are concerns on its financial health. ARG is not valued too expensively and it also shows a decent growth rate. ARG also has an excellent dividend rating.


Dividend Valuation Growth Profitability Health

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6

1. Profitability

1.1 Basic Checks

In the past year ARG was profitable.
ARG had a positive operating cash flow in the past year.
ARG had positive earnings in 4 of the past 5 years.
Each year in the past 5 years ARG had a positive operating cash flow.
ARG.PA Yearly Net Income VS EBIT VS OCF VS FCFARG.PA Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 2023 0 200M -200M 400M 600M

1.2 Ratios

With a decent Return On Assets value of 2.26%, ARG is doing good in the industry, outperforming 60.98% of the companies in the same industry.
Looking at the Return On Equity, with a value of 4.55%, ARG is in the better half of the industry, outperforming 60.98% of the companies in the same industry.
ARG has a Return On Invested Capital (3.34%) which is in line with its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for ARG is in line with the industry average of 3.99%.
The last Return On Invested Capital (3.34%) for ARG is above the 3 year average (2.90%), which is a sign of increasing profitability.
Industry RankSector Rank
ROA 2.26%
ROE 4.55%
ROIC 3.34%
ROA(3y)3.51%
ROA(5y)5.21%
ROE(3y)7.25%
ROE(5y)11.6%
ROIC(3y)2.9%
ROIC(5y)2.65%
ARG.PA Yearly ROA, ROE, ROICARG.PA Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2015 2016 2017 2018 2019 2020 2021 2022 2023 0 10 -10 20 30

1.3 Margins

ARG has a Profit Margin of 48.87%. This is in the better half of the industry: ARG outperforms 70.73% of its industry peers.
The Operating Margin of ARG (92.90%) is better than 90.24% of its industry peers.
In the last couple of years the Operating Margin of ARG has remained more or less at the same level.
Industry RankSector Rank
OM 92.9%
PM (TTM) 48.87%
GM N/A
OM growth 3Y-0.27%
OM growth 5Y0.35%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3YN/A
GM growth 5YN/A
ARG.PA Yearly Profit, Operating, Gross MarginsARG.PA Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2015 2016 2017 2018 2019 2020 2021 2022 2023 0 100 -100 200 300 400

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3

2. Health

2.1 Basic Checks

With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), ARG is destroying value.
The number of shares outstanding for ARG has been increased compared to 1 year ago.
ARG has more shares outstanding than it did 5 years ago.
The debt/assets ratio for ARG is higher compared to a year ago.
ARG.PA Yearly Shares OutstandingARG.PA Yearly Shares OutstandingYearly Shares Outstanding 2015 2016 2017 2018 2019 2020 2021 2022 2023 5M 10M 15M 20M
ARG.PA Yearly Total Debt VS Total AssetsARG.PA Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2015 2016 2017 2018 2019 2020 2021 2022 2023 1B 2B 3B 4B

2.2 Solvency

Based on the Altman-Z score of 1.20, we must say that ARG is in the distress zone and has some risk of bankruptcy.
ARG has a better Altman-Z score (1.20) than 80.49% of its industry peers.
ARG has a debt to FCF ratio of 11.78. This is a negative value and a sign of low solvency as ARG would need 11.78 years to pay back of all of its debts.
With a decent Debt to FCF ratio value of 11.78, ARG is doing good in the industry, outperforming 60.98% of the companies in the same industry.
ARG has a Debt/Equity ratio of 0.88. This is a neutral value indicating ARG is somewhat dependend on debt financing.
ARG has a Debt to Equity ratio of 0.88. This is in the lower half of the industry: ARG underperforms 68.29% of its industry peers.
Industry RankSector Rank
Debt/Equity 0.88
Debt/FCF 11.78
Altman-Z 1.2
ROIC/WACC0.61
WACC5.52%
ARG.PA Yearly LT Debt VS Equity VS FCFARG.PA Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 2023 0 500M 1B 1.5B 2B

2.3 Liquidity

A Current Ratio of 0.65 indicates that ARG may have some problems paying its short term obligations.
With a Current ratio value of 0.65, ARG perfoms like the industry average, outperforming 58.54% of the companies in the same industry.
ARG has a Quick Ratio of 0.65. This is a bad value and indicates that ARG is not financially healthy enough and could expect problems in meeting its short term obligations.
The Quick ratio of ARG (0.65) is better than 60.98% of its industry peers.
Industry RankSector Rank
Current Ratio 0.65
Quick Ratio 0.65
ARG.PA Yearly Current Assets VS Current LiabilitesARG.PA Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2015 2016 2017 2018 2019 2020 2021 2022 2023 200M 400M 600M 800M

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5

3. Growth

3.1 Past

ARG shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 118.49%, which is quite impressive.
Looking at the last year, ARG shows a quite strong growth in Revenue. The Revenue has grown by 9.10% in the last year.
ARG shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 16.78% yearly.
EPS 1Y (TTM)118.49%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%132.73%
Revenue 1Y (TTM)9.1%
Revenue growth 3Y8.93%
Revenue growth 5Y16.78%
Sales Q2Q%8.43%

3.2 Future

Based on estimates for the next years, ARG will show a very strong growth in Earnings Per Share. The EPS will grow by 99.71% on average per year.
Based on estimates for the next years, ARG will show a small growth in Revenue. The Revenue will grow by 5.36% on average per year.
EPS Next Y1399.37%
EPS Next 2Y296.66%
EPS Next 3Y151.52%
EPS Next 5Y99.71%
Revenue Next Year7.27%
Revenue Next 2Y6.69%
Revenue Next 3Y5.69%
Revenue Next 5Y5.36%

3.3 Evolution

The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
ARG.PA Yearly Revenue VS EstimatesARG.PA Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 50M 100M 150M 200M
ARG.PA Yearly EPS VS EstimatesARG.PA Yearly EPS VS EstimatesYearly EPS VS Estimates 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 0 2 4 6

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6

4. Valuation

4.1 Price/Earnings Ratio

With a Price/Earnings ratio of 15.44, ARG is valued correctly.
Compared to the rest of the industry, the Price/Earnings ratio of ARG is on the same level as its industry peers.
ARG is valuated rather cheaply when we compare the Price/Earnings ratio to 29.07, which is the current average of the S&P500 Index.
With a Price/Forward Earnings ratio of 10.27, the valuation of ARG can be described as very reasonable.
Compared to the rest of the industry, the Price/Forward Earnings ratio of ARG is on the same level as its industry peers.
When comparing the Price/Forward Earnings ratio of ARG to the average of the S&P500 Index (22.05), we can say ARG is valued rather cheaply.
Industry RankSector Rank
PE 15.44
Fwd PE 10.27
ARG.PA Price Earnings VS Forward Price EarningsARG.PA Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 5 10 15 20 25

4.2 Price Multiples

The rest of the industry has a similar Enterprise Value to EBITDA ratio as ARG.
ARG's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. ARG is cheaper than 60.98% of the companies in the same industry.
Industry RankSector Rank
P/FCF 9.5
EV/EBITDA 19.54
ARG.PA Per share dataARG.PA EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 20 40 60 80

4.3 Compensation for Growth

ARG's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
ARG has a very decent profitability rating, which may justify a higher PE ratio.
ARG's earnings are expected to grow with 151.52% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.01
PEG (5Y)N/A
EPS Next 2Y296.66%
EPS Next 3Y151.52%

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7

5. Dividend

5.1 Amount

ARG has a Yearly Dividend Yield of 5.25%, which is a nice return.
ARG's Dividend Yield is comparable with the industry average which is at 8.11.
ARG's Dividend Yield is rather good when compared to the S&P500 average which is at 2.39.
Industry RankSector Rank
Dividend Yield 5.25%

5.2 History

The dividend of ARG is nicely growing with an annual growth rate of 35.57%!
Dividend Growth(5Y)35.57%
Div Incr Years1
Div Non Decr Years1
ARG.PA Yearly Dividends per shareARG.PA Yearly Dividends per shareYearly Dividends per share 2019 2020 2021 2022 2023 2024 2025 0.5 1 1.5 2

5.3 Sustainability

55.64% of the earnings are spent on dividend by ARG. This is a bit on the high side, but may be sustainable.
ARG's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP55.64%
EPS Next 2Y296.66%
EPS Next 3Y151.52%
ARG.PA Yearly Income VS Free CF VS DividendARG.PA Yearly Income VS Free CF VS DividendYearly Income VS Free CF VS Dividend 2015 2016 2017 2018 2019 2020 2021 2022 2023 0 200M -200M 400M 600M
ARG.PA Dividend Payout.ARG.PA Dividend Payout, showing the Payout Ratio.ARG.PA Dividend Payout.PayoutRetained Earnings

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ARGAN

EPA:ARG (3/26/2025, 5:29:37 PM)

61

-4.1 (-6.3%)

Chartmill FA Rating
GICS SectorReal Estate
GICS IndustryGroupEquity Real Estate Investment Trusts (REITs)
GICS IndustryDiversified REITs
Earnings (Last)01-16 2025-01-16/amc
Earnings (Next)04-01 2025-04-01
Inst Owners31.33%
Inst Owner ChangeN/A
Ins Owners36.77%
Ins Owner ChangeN/A
Market Cap1.55B
Analysts81.54
Price Target82.37 (35.03%)
Short Float %N/A
Short RatioN/A
Dividend
Industry RankSector Rank
Dividend Yield 5.25%
Yearly Dividend2.68
Dividend Growth(5Y)35.57%
DP55.64%
Div Incr Years1
Div Non Decr Years1
Ex-DateN/A
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)N/A
Avg Revenue beat(2)N/A
Min Revenue beat(2)N/A
Max Revenue beat(2)N/A
Revenue beat(4)N/A
Avg Revenue beat(4)N/A
Min Revenue beat(4)N/A
Max Revenue beat(4)N/A
Revenue beat(8)N/A
Avg Revenue beat(8)N/A
Revenue beat(12)N/A
Avg Revenue beat(12)N/A
Revenue beat(16)N/A
Avg Revenue beat(16)N/A
PT rev (1m)0%
PT rev (3m)-9.47%
EPS NQ rev (1m)N/A
EPS NQ rev (3m)N/A
EPS NY rev (1m)0%
EPS NY rev (3m)6.71%
Revenue NQ rev (1m)N/A
Revenue NQ rev (3m)N/A
Revenue NY rev (1m)0%
Revenue NY rev (3m)0.05%
Valuation
Industry RankSector Rank
PE 15.44
Fwd PE 10.27
P/S 8.02
P/FCF 9.5
P/OCF 9.5
P/B 0.75
P/tB 0.77
EV/EBITDA 19.54
EPS(TTM)3.95
EY6.48%
EPS(NY)5.94
Fwd EY9.74%
FCF(TTM)6.42
FCFY10.52%
OCF(TTM)6.42
OCFY10.53%
SpS7.6
BVpS81.66
TBVpS79.47
PEG (NY)0.01
PEG (5Y)N/A
Profitability
Industry RankSector Rank
ROA 2.26%
ROE 4.55%
ROCE 4.55%
ROIC 3.34%
ROICexc 3.4%
ROICexgc 3.45%
OM 92.9%
PM (TTM) 48.87%
GM N/A
FCFM 84.42%
ROA(3y)3.51%
ROA(5y)5.21%
ROE(3y)7.25%
ROE(5y)11.6%
ROIC(3y)2.9%
ROIC(5y)2.65%
ROICexc(3y)3.09%
ROICexc(5y)2.78%
ROICexgc(3y)3.14%
ROICexgc(5y)2.83%
ROCE(3y)3.95%
ROCE(5y)3.61%
ROICexcg growth 3Y2.21%
ROICexcg growth 5Y-3.66%
ROICexc growth 3Y2.31%
ROICexc growth 5Y-3.95%
OM growth 3Y-0.27%
OM growth 5Y0.35%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3YN/A
GM growth 5YN/A
F-Score7
Asset Turnover0.05
Health
Industry RankSector Rank
Debt/Equity 0.88
Debt/FCF 11.78
Debt/EBITDA 10.16
Cap/Depr 31.68%
Cap/Sales 0.04%
Interest Coverage 250
Cash Conversion 90.79%
Profit Quality 172.75%
Current Ratio 0.65
Quick Ratio 0.65
Altman-Z 1.2
F-Score7
WACC5.52%
ROIC/WACC0.61
Cap/Depr(3y)51.95%
Cap/Depr(5y)N/A
Cap/Sales(3y)0.08%
Cap/Sales(5y)62.23%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)118.49%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%132.73%
EPS Next Y1399.37%
EPS Next 2Y296.66%
EPS Next 3Y151.52%
EPS Next 5Y99.71%
Revenue 1Y (TTM)9.1%
Revenue growth 3Y8.93%
Revenue growth 5Y16.78%
Sales Q2Q%8.43%
Revenue Next Year7.27%
Revenue Next 2Y6.69%
Revenue Next 3Y5.69%
Revenue Next 5Y5.36%
EBIT growth 1Y10.22%
EBIT growth 3Y8.63%
EBIT growth 5Y17.18%
EBIT Next Year381.6%
EBIT Next 3Y73.01%
EBIT Next 5Y64.31%
FCF growth 1Y21.46%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y21.4%
OCF growth 3Y12.24%
OCF growth 5Y18.05%