We assign a fundamental rating of 5 out of 10 to ATHM. ATHM was compared to 70 industry peers in the Interactive Media & Services industry. ATHM has an excellent financial health rating, but there are some minor concerns on its profitability. ATHM is valued correctly, but it does not seem to be growing.

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1. Profitability

2. Health

3. Growth

4. Valuation

5. Dividend

1. Profitability

1.1 Basic Checks

ATHM had positive earnings in the past year.
In the past 5 years ATHM has always been profitable.
In the past 5 years ATHM always reported a positive cash flow from operatings.

1.2 Ratios

With a decent Return On Assets value of 5.08%, ATHM is doing good in the industry, outperforming 74.29% of the companies in the same industry.
With a decent Return On Equity value of 6.07%, ATHM is doing good in the industry, outperforming 71.43% of the companies in the same industry.
The Return On Invested Capital of ATHM (2.19%) is comparable to the rest of the industry.
The Average Return On Invested Capital over the past 3 years for ATHM is significantly below the industry average of 13.70%.

		Industry Rank	Sector Rank
ROA	5.08%
ROE	6.07%
ROIC	2.19%

ROA(3y)5.85%

ROA(5y)7.89%

ROE(3y)7.39%

ROE(5y)10.2%

ROIC(3y)2.57%

ROIC(5y)4.69%

1.3 Margins

The Profit Margin of ATHM (21.59%) is better than 87.14% of its industry peers.
In the last couple of years the Profit Margin of ATHM has declined.
With a decent Operating Margin value of 10.54%, ATHM is doing good in the industry, outperforming 72.86% of the companies in the same industry.
In the last couple of years the Operating Margin of ATHM has declined.
The Gross Margin of ATHM (72.04%) is better than 65.71% of its industry peers.
In the last couple of years the Gross Margin of ATHM has declined.

		Industry Rank	Sector Rank
OM	10.54%
PM (TTM)	21.59%
GM	72.04%

OM growth 3Y-20.94%

OM growth 5Y-20.88%

PM growth 3Y-8.15%

PM growth 5Y-9.55%

GM growth 3Y-2.64%

GM growth 5Y-2.28%

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ROA

ROE

ROIC

Operating and Profit Margin

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2. Health

2.1 Basic Checks

With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), ATHM is destroying value.
ATHM has more shares outstanding than it did 1 year ago.
ATHM has more shares outstanding than it did 5 years ago.
ATHM has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.

2.2 Solvency

ATHM has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.

		Industry Rank	Sector Rank
Debt/Equity	0
Debt/FCF	N/A
Altman-Z	N/A

ROIC/WACC0.29

WACC7.54%

2.3 Liquidity

A Current Ratio of 8.01 indicates that ATHM has no problem at all paying its short term obligations.
ATHM has a Current ratio of 8.01. This is amongst the best in the industry. ATHM outperforms 91.43% of its industry peers.
A Quick Ratio of 8.01 indicates that ATHM has no problem at all paying its short term obligations.
ATHM's Quick ratio of 8.01 is amongst the best of the industry. ATHM outperforms 91.43% of its industry peers.

		Industry Rank	Sector Rank
Current Ratio	8.01
Quick Ratio	8.01

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WACC

Debt/Equity

How to determine the health of a company

Altman-Z score

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3. Growth

3.1 Past

ATHM shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -11.87%.
ATHM shows a decrease in Earnings Per Share. Measured over the last years, the EPS has been decreasing by -9.99% yearly.
The Revenue has decreased by -5.52% in the past year.
Measured over the past years, ATHM shows a decrease in Revenue. The Revenue has been decreasing by -3.52% on average per year.

EPS 1Y (TTM)-11.87%

EPS 3Y-6.54%

EPS 5Y-9.99%

EPS Q2Q%-15.44%

Revenue 1Y (TTM)-5.52%

Revenue growth 3Y-0.92%

Revenue growth 5Y-3.52%

Sales Q2Q%0.2%

3.2 Future

ATHM is expected to show a decrease in Earnings Per Share. In the coming years, the EPS will decrease by -2.91% yearly.
ATHM is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 5.84% yearly.

EPS Next Y-15.71%

EPS Next 2Y-8.99%

EPS Next 3Y-4.53%

EPS Next 5Y-2.91%

Revenue Next Year-3.39%

Revenue Next 2Y-0.59%

Revenue Next 3Y0.48%

Revenue Next 5Y5.84%

3.3 Evolution

The EPS growth rate is accelerating: in the next years the growth will be better 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 accelerating.

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4. Valuation

4.1 Price/Earnings Ratio

The Price/Earnings ratio is 10.54, which indicates a very decent valuation of ATHM.
Based on the Price/Earnings ratio, ATHM is valued a bit cheaper than the industry average as 78.57% of the companies are valued more expensively.
When comparing the Price/Earnings ratio of ATHM to the average of the S&P500 Index (27.25), we can say ATHM is valued rather cheaply.
Based on the Price/Forward Earnings ratio of 11.34, the valuation of ATHM can be described as reasonable.
Based on the Price/Forward Earnings ratio, ATHM is valued a bit cheaper than the industry average as 75.71% of the companies are valued more expensively.
ATHM is valuated cheaply when we compare the Price/Forward Earnings ratio to 25.98, which is the current average of the S&P500 Index.

		Industry Rank	Sector Rank
PE	10.54
Fwd PE	11.34

4.2 Price Multiples

ATHM's Enterprise Value to EBITDA is on the same level as the industry average.

		Industry Rank	Sector Rank
P/FCF	N/A
EV/EBITDA	20.63

4.3 Compensation for Growth

ATHM's earnings are expected to decrease with -4.53% in the coming years. This may justify a cheaper valuation.

PEG (NY)N/A

PEG (5Y)N/A

EPS Next 2Y-8.99%

EPS Next 3Y-4.53%

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5. Dividend

5.1 Amount

With a Yearly Dividend Yield of 7.61%, ATHM is a good candidate for dividend investing.
ATHM's Dividend Yield is rather good when compared to the industry average which is at 0.77. ATHM pays more dividend than 98.57% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 1.82, ATHM pays a better dividend.

		Industry Rank	Sector Rank
Dividend Yield	7.61%

5.2 History

ATHM has been paying a dividend for over 5 years, so it has already some track record.
The dividend of ATHM decreased in the last 3 years.

Dividend Growth(5Y)N/A

Div Incr Years2

Div Non Decr Years2

5.3 Sustainability

DPN/A

EPS Next 2Y-8.99%

EPS Next 3Y-4.53%

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AUTOHOME INC-ADR / ATHM FAQ

Can you provide the ChartMill fundamental rating for AUTOHOME INC-ADR?

ChartMill assigns a fundamental rating of 5 / 10 to ATHM.

What is the valuation status for ATHM stock?

ChartMill assigns a valuation rating of 4 / 10 to AUTOHOME INC-ADR (ATHM). This can be considered as Fairly Valued.

What is the profitability of ATHM stock?

AUTOHOME INC-ADR (ATHM) has a profitability rating of 5 / 10.

Can you provide the PE and PB ratios for ATHM stock?

The Price/Earnings (PE) ratio for AUTOHOME INC-ADR (ATHM) is 10.54 and the Price/Book (PB) ratio is 0.78.

What is the earnings growth outlook for AUTOHOME INC-ADR?

The Earnings per Share (EPS) of AUTOHOME INC-ADR (ATHM) is expected to decline by -15.71% in the next year.