LATAM AIRLINES GROUP SA-ADR (LTM) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:LTM - US51817R1068 - ADR
63.62 USD
+1.2 (+1.92%)
63.62 USD
0 (0%)
We assign a fundamental rating of 5 out of 10 to LTM. LTM was compared to 22 industry peers in the Passenger Airlines industry. Both the profitability and the financial health of LTM get a neutral evaluation. Nothing too spectacular is happening here. LTM is valied quite expensively at the moment, while it does show a decent growth rate.
1. Profitability
1.1 Basic Checks
- In the past year LTM has reported negative net income.
- LTM had a positive operating cash flow in the past year.
- In multiple years LTM reported negative net income over the last 5 years.
- The reported operating cash flow has been mixed in the past 5 years: LTM reported negative operating cash flow in multiple years.
1.2 Ratios
- With an excellent Return On Assets value of 7.05%, LTM belongs to the best of the industry, outperforming 90.91% of the companies in the same industry.
- LTM has a better Return On Equity (127.90%) than 100.00% of its industry peers.
- LTM has a better Return On Invested Capital (15.79%) than 90.91% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.05% | ||
| ROE | 127.9% | ||
| ROIC | 15.79% |
ROA(3y)6.84%
ROA(5y)-8.7%
ROE(3y)1143.97%
ROE(5y)N/A
ROIC(3y)N/A
ROIC(5y)N/A
1.3 Margins
- With an excellent Profit Margin value of 8.88%, LTM belongs to the best of the industry, outperforming 86.36% of the companies in the same industry.
- LTM's Profit Margin has improved in the last couple of years.
- The Operating Margin of LTM (14.24%) is better than 86.36% of its industry peers.
- In the last couple of years the Operating Margin of LTM has grown nicely.
- LTM's Gross Margin of 27.19% is on the low side compared to the rest of the industry. LTM is outperformed by 63.64% of its industry peers.
- LTM's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 14.24% | ||
| PM (TTM) | 8.88% | ||
| GM | 27.19% |
OM growth 3YN/A
OM growth 5Y9.93%
PM growth 3YN/A
PM growth 5Y32.12%
GM growth 3YN/A
GM growth 5Y3.89%
2. Health
2.1 Basic Checks
- LTM has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
- The number of shares outstanding for LTM remains at a similar level compared to 1 year ago.
- Compared to 5 years ago, LTM has more shares outstanding
- LTM has a better debt/assets ratio than last year.
2.2 Solvency
- LTM has an Altman-Z score of 1.65. This is a bad value and indicates that LTM is not financially healthy and even has some risk of bankruptcy.
- The Altman-Z score of LTM (1.65) is better than 72.73% of its industry peers.
- The Debt to FCF ratio of LTM is 5.56, which is a neutral value as it means it would take LTM, 5.56 years of fcf income to pay off all of its debts.
- With an excellent Debt to FCF ratio value of 5.56, LTM belongs to the best of the industry, outperforming 81.82% of the companies in the same industry.
- A Debt/Equity ratio of 7.40 is on the high side and indicates that LTM has dependencies on debt financing.
- Looking at the Debt to Equity ratio, with a value of 7.40, LTM is in line with its industry, outperforming 45.45% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 7.4 | ||
| Debt/FCF | 5.56 | ||
| Altman-Z | 1.65 |
ROIC/WACC1.55
WACC10.16%
2.3 Liquidity
- A Current Ratio of 0.60 indicates that LTM may have some problems paying its short term obligations.
- With a Current ratio value of 0.60, LTM perfoms like the industry average, outperforming 54.55% of the companies in the same industry.
- LTM has a Quick Ratio of 0.60. This is a bad value and indicates that LTM is not financially healthy enough and could expect problems in meeting its short term obligations.
- Looking at the Quick ratio, with a value of 0.53, LTM is in line with its industry, outperforming 50.00% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.6 | ||
| Quick Ratio | 0.53 |
3. Growth
3.1 Past
- The earnings per share for LTM have decreased strongly by -100.00% in the last year.
- Measured over the past years, LTM shows a very negative growth in Earnings Per Share. The EPS has been decreasing by -50.65% on average per year.
- LTM shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 10.24%.
- LTM shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 4.97% yearly.
EPS 1Y (TTM)-100%
EPS 3YN/A
EPS 5Y-50.65%
EPS Q2Q%-100%
Revenue 1Y (TTM)10.24%
Revenue growth 3Y37.99%
Revenue growth 5Y4.97%
Sales Q2Q%17.06%
3.2 Future
- LTM is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 26.41% yearly.
- LTM is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 7.95% yearly.
EPS Next Y35.34%
EPS Next 2Y16.34%
EPS Next 3Y26.41%
EPS Next 5YN/A
Revenue Next Year9.14%
Revenue Next 2Y8.25%
Revenue Next 3Y7.95%
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 accelerating.
- 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.
4. Valuation
4.1 Price/Earnings Ratio
- A Price/Forward Earnings ratio of 45.13 indicates a quite expensive valuation of LTM.
- LTM's Price/Forward Earnings ratio is in line with the industry average.
- Compared to an average S&P500 Price/Forward Earnings ratio of 24.26, LTM is valued quite expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | N/A | ||
| Fwd PE | 45.13 |
4.2 Price Multiples
- LTM's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. LTM is cheaper than 77.27% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 13.5 | ||
| EV/EBITDA | N/A |
4.3 Compensation for Growth
- The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
- LTM has a very decent profitability rating, which may justify a higher PE ratio.
- LTM's earnings are expected to grow with 26.41% in the coming years. This may justify a more expensive valuation.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y16.34%
EPS Next 3Y26.41%
5. Dividend
5.1 Amount
- With a Yearly Dividend Yield of 3.87%, LTM has a reasonable but not impressive dividend return.
- Compared to an average industry Dividend Yield of 0.86, LTM pays a better dividend. On top of this LTM pays more dividend than 95.45% of the companies listed in the same industry.
- Compared to an average S&P500 Dividend Yield of 1.82, LTM pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.87% |
5.2 History
- The dividend of LTM decreases each year by -47.04%.
- LTM has been paying a dividend for over 5 years, so it has already some track record.
Dividend Growth(5Y)-47.04%
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
- LTM pays out 25.08% of its income as dividend. This is a sustainable payout ratio.
DP25.08%
EPS Next 2Y16.34%
EPS Next 3Y26.41%
LATAM AIRLINES GROUP SA-ADR / LTM FAQ
What is the fundamental rating for LTM stock?
ChartMill assigns a fundamental rating of 5 / 10 to LTM.
What is the valuation status of LATAM AIRLINES GROUP SA-ADR (LTM) stock?
ChartMill assigns a valuation rating of 3 / 10 to LATAM AIRLINES GROUP SA-ADR (LTM). This can be considered as Overvalued.
Can you provide the profitability details for LATAM AIRLINES GROUP SA-ADR?
LATAM AIRLINES GROUP SA-ADR (LTM) has a profitability rating of 6 / 10.
What is the earnings growth outlook for LATAM AIRLINES GROUP SA-ADR?
The Earnings per Share (EPS) of LATAM AIRLINES GROUP SA-ADR (LTM) is expected to grow by 35.34% in the next year.