ASX:ALU

Stock Analysis Report

Executive Summary

Altium Limited develops and sells computer software for the design of electronic products in the United States and internationally.

Snowflake

Fundamentals

Flawless balance sheet with solid track record.


Similar Companies

Share Price & News

How has Altium's share price performed over time and what events caused price changes?


Latest Share Price and Events


Market Performance


7 Day Return

-4.8%

ALU

-5.7%

AU Software

0.1%

AU Market


1 Year Return

52.5%

ALU

42.6%

AU Software

11.9%

AU Market

Return vs Industry: ALU exceeded the Australian Software industry which returned 42.6% over the past year.

Return vs Market: ALU exceeded the Australian Market which returned 11.9% over the past year.


Shareholder returns

ALUIndustryMarket
7 Day-4.8%-5.7%0.1%
30 Day-6.2%-6.0%-1.1%
90 Day-13.8%-4.7%-1.4%
1 Year54.0%52.5%43.8%42.6%18.5%11.9%
3 Year337.3%316.8%125.8%116.7%36.4%18.1%
5 Year1100.3%971.6%165.9%144.1%50.9%16.7%

Price Volatility Vs. Market

How volatile is Altium's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Altium undervalued compared to its fair value and its price relative to the market?

54.94x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: ALU (A$32.47) is trading above our estimate of fair value (A$24.51)

Significantly Below Fair Value: ALU is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: ALU is poor value based on its PE Ratio (54.9x) compared to the Software industry average (34.3x).

PE vs Market: ALU is poor value based on its PE Ratio (54.9x) compared to the Australian market (18.5x).


Price to Earnings Growth Ratio

PEG Ratio: ALU is poor value based on its PEG Ratio (3x)


Price to Book Ratio

PB vs Industry: ALU is overvalued based on its PB Ratio (15.8x) compared to the AU Software industry average (4.3x).


Next Steps

Future Growth

How is Altium forecast to perform in the next 1 to 3 years based on estimates from 5 analysts?

18.5%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: ALU's forecast earnings growth (18.5% per year) is above the savings rate (2.3%).

Earnings vs Market: ALU's earnings (18.5% per year) are forecast to grow faster than the Australian market (10.2% per year).

High Growth Earnings: ALU's earnings are forecast to grow, but not significantly.

Revenue vs Market: ALU's revenue (18.2% per year) is forecast to grow faster than the Australian market (3.6% per year).

High Growth Revenue: ALU's revenue (18.2% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: ALU's Return on Equity is forecast to be high in 3 years time (35.6%)


Next Steps

Past Performance

How has Altium performed over the past 5 years?

-0.3%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

Earnings Trend: ALU's earnings have declined by -0.3% per year over the past 5 years.

Accelerating Growth: ALU's earnings growth over the past year (41.1%) exceeds its 5-year average (-0.3% per year).

Earnings vs Industry: ALU earnings growth over the past year (41.1%) exceeded the Software industry 22.6%.


Return on Equity

High ROE: ALU's Return on Equity (28.7%) is considered high.


Return on Assets

ROA vs Industry: ALU has a higher Return on Assets than the Software industry average last year.


Return on Capital Employed

ROCE Improving: ALU has significantly improved its Return on Capital Employed over the past 3 years.


Next Steps

Financial Health

How is Altium's financial position?


Financial Position Analysis

Short Term Liabilities: ALU's short term assets ($131.5M) exceeds its short term liabilities ($72.4M)

Long Term Liabilities: ALU's short term assets (131.5M) exceeds its long term liabilities (21.0M)


Debt to Equity History and Analysis

Debt Level: ALU is debt free.

Reducing Debt: ALU has not had any debt for past 5 years.

Debt Coverage: ALU has no debt, therefore it does not need to be covered by operating cash flow.

Interest Coverage: ALU has no debt, therefore coverage of interest payments is not a concern.


Balance Sheet

Inventory Level: ALU has a low level of unsold assets or inventory.

Debt Coverage by Assets: Insufficient data to determine if ALU's debt is covered by short term assets.


Next Steps

Dividend

What is Altium's current dividend yield, its reliability and sustainability?

1.08%

Current Dividend Yield


Dividend Yield vs Market

company1.1%marketbottom25%2.4%markettop25%5.6%industryaverage1.2%forecastin3Years1.8%

Current dividend yield vs market & industry


Stability and Growth of Payments

Notable Dividend: ALU's dividend (1.08%) isn’t notable compared to the bottom 25% of dividend payers in the Australian market (2.44%).

High Dividend: ALU's dividend (1.08%) is low compared to the top 25% of dividend payers in the Australian market (5.58%).

Stable Dividend: ALU is not paying a notable dividend for the Australian market, therefore no need to check if payments are stable.

Growing Dividend: ALU is not paying a notable dividend for the Australian market, therefore no need to check if payments are increasing.


Current Payout to Shareholders

Dividend Coverage: ALU is not paying a notable dividend for the Australian market.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of ALU's dividend in 3 years as they are not forecast to pay a notable one for the Australian market.


Next Steps

Management

What is the CEO of Altium's salary, the management and board of directors tenure and is there insider trading?

5.2yrs

Average management tenure


CEO

Aram Mirkazemi 0

5.8yrs

Tenure

US$3,054,189

Compensation

Mr. Aram Mirkazemi, BE, has been the Chief Executive Officer at Altium Limited since January 16, 2014. Mr. Mirkazemi served as Chief Technology Officer of Altium Ltd. since October 16, 2012 until January 1 ...


CEO Compensation Analysis

Compensation vs. Market: Aram's total compensation ($USD3.05M) is about average for companies of similar size in the Australian market ($USD2.18M).

Compensation vs Earnings: Aram's compensation has increased by more than 20% in the past year.


Management Age and Tenure

5.2yrs

Average Tenure

Experienced Management: ALU's management team is seasoned and experienced (5.2 years average tenure).


Board Age and Tenure

2.8yrs

Average Tenure

59yo

Average Age

Experienced Board: ALU's board of directors are not considered experienced ( 2.8 years average tenure), which suggests a new board.


Insider Trading

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

BuyUS$13,223,59013 Aug 19
Vinva Investment Management
EntityCompany
Shares532,272
Max PriceUS$24.84
SellUS$16,137,86513 Aug 19
Vinva Investment Management
EntityCompany
Shares481,017
Max PriceUS$33.55
BuyUS$492,58328 Jul 19
BlackRock, Inc.
EntityCompany
Shares13,140
Max PriceUS$37.56
BuyUS$68,13625 Jul 19
BlackRock, Inc.
EntityCompany
Shares1,844
Max PriceUS$36.96
SellUS$638,29425 Jul 19
BlackRock, Inc.
EntityCompany
Shares17,378
Max PriceUS$36.73
BuyUS$542,88424 Jul 19
BlackRock, Inc.
EntityCompany
Shares1,205,391
Max PriceUS$36.77
BuyUS$100,23530 Dec 18
Lynn Mickleburgh
EntityIndividual
Role
Member of the Board of Directors
Non-Executive Director
Shares6,800
Max PriceUS$14.74
BuyUS$7,164,94206 Dec 18
Vinva Investment Management
EntityCompany
Shares303,394
Max PriceUS$23.62
SellUS$2,163,73206 Dec 18
Vinva Investment Management
EntityCompany
Shares82,905
Max PriceUS$26.10
BuyUS$104,16226 Oct 18
Wendy Stops
EntityIndividual
Role
Member of the Board of Directors
Independent Non-Executive Director
Shares5,000
Max PriceUS$20.83

Ownership Breakdown


Management Team

  • Henry Potts (72yo)

    • Tenure: 0yrs
    • Compensation: US$3.40m
  • Joe Bedewi (59yo)

    Chief Financial Officer

    • Tenure: 3.6yrs
    • Compensation: US$915.14k
  • Aram Mirkazemi

    CEO & Executive Director

    • Tenure: 5.8yrs
    • Compensation: US$3.05m
  • Kim Besharati

    Company Secretary and VP of Investor Relations & Corporate Affairs

    • Tenure: 4.7yrs
  • Alison Raffin

    Company Secretary

    • Tenure: 7.9yrs
  • Rainer Asfalg

    Global Head of Technical Sales & Support

    • Tenure: 0yrs
  • Ted Pawela

    Chief Operating Officer

    • Tenure: 0yrs
  • Sergiy Kostynsky

    Executive Director

    • Tenure: 1.8yrs
    • Compensation: US$1.07m
  • Don Cantow

    Senior Vice President of Solution Sales

    • Tenure: 0yrs
  • Leigh Gawne

    Head of Ciiva

    • Tenure: 0yrs

Board Members

  • Sam Weiss (65yo)

    Independent Non-Executive Chairman

    • Tenure: 12yrs
    • Compensation: US$285.00k
  • Raelene Murphy (59yo)

    Non-Executive Director

    • Tenure: 3.1yrs
    • Compensation: US$150.00k
  • Aram Mirkazemi

    CEO & Executive Director

    • Tenure: 5.8yrs
    • Compensation: US$3.05m
  • Wendy Stops (58yo)

    Independent Non-Executive Director

    • Tenure: 1.7yrs
    • Compensation: US$150.00k
  • Lynn Mickleburgh

    Non-Executive Director

    • Tenure: 2.6yrs
    • Compensation: US$142.50k
  • Sergiy Kostynsky

    Executive Director

    • Tenure: 1.8yrs
    • Compensation: US$1.07m

Company Information

Altium Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Altium Limited
  • Ticker: ALU
  • Exchange: ASX
  • Founded: 1985
  • Industry: Application Software
  • Sector: Software
  • Market Cap: AU$4.276b
  • Shares outstanding: 130.97m
  • Website: https://www.altium.com

Number of Employees


Location

  • Altium Limited
  • 4225 Executive Square
  • Level 7
  • La Jolla
  • California
  • 92037
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
ALUASX (Australian Securities Exchange)YesOrdinary SharesAUAUDAug 1999
ALMF.FOTCPK (Pink Sheets LLC)YesOrdinary SharesUSUSDAug 1999
ALUCHIA (Chi-X Australia)YesOrdinary SharesAUAUDAug 1999
A5VDB (Deutsche Boerse AG)YesOrdinary SharesDEEURAug 1999

Biography

Altium Limited develops and sells computer software for the design of electronic products in the United States and internationally. It operates through Board and Systems; Microcontrollers and Embedded Syst ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/10/23 10:32
End of Day Share Price2019/10/23 00:00
Earnings2019/06/30
Annual Earnings2019/06/30


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.