ASX:ALX

Stock Analysis Report

Executive Summary

Atlas Arteria Limited invests in infrastructure and non-infrastructure assets.

Rewards

Earnings are forecast to grow 37.51% per year

Risk Analysis

Debt is not well covered by operating cash flow

Dividend of 3.62% is not well covered by earnings or forecast to be in the next 3 years

Shareholders have been substantially diluted in the past year

Large one-off items impacting financial results

+ 1 more risk


Snowflake Analysis

Reasonable growth potential with poor track record.


Similar Companies

Share Price & News

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


Latest Share Price and Events

Stable Share Price: ALX has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

-2.7%

ALX

0.6%

AU Infrastructure

1.5%

AU Market


1 Year Return

26.1%

ALX

31.3%

AU Infrastructure

20.1%

AU Market

Return vs Industry: ALX underperformed the Australian Infrastructure industry which returned 32.3% over the past year.

Return vs Market: ALX exceeded the Australian Market which returned 19.4% over the past year.


Shareholder returns

ALXIndustryMarket
7 Day-2.7%0.6%1.5%
30 Day1.1%1.5%3.9%
90 Day-3.6%6.5%5.5%
1 Year33.4%26.1%36.5%31.3%25.6%20.1%
3 Year88.7%63.8%74.0%52.3%39.7%20.9%
5 Year236.2%168.7%125.5%81.5%60.8%24.7%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

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

377.84x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: ALX (A$8.28) is trading above our estimate of fair value (A$5.37)

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


Price To Earnings Ratio

PE vs Industry: ALX is poor value based on its PE Ratio (388.1x) compared to the Infrastructure industry average (29.6x).

PE vs Market: ALX is poor value based on its PE Ratio (388.1x) compared to the Australian market (18.9x).


Price to Earnings Growth Ratio

PEG Ratio: ALX is poor value based on its PEG Ratio (10.3x)


Price to Book Ratio

PB vs Industry: ALX is overvalued based on its PB Ratio (2.6x) compared to the XO Infrastructure industry average (2.3x).


Next Steps

Future Growth

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

39.9%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: ALX's forecast earnings growth (37.5% per year) is above the savings rate (1.1%).

Earnings vs Market: ALX's earnings (37.5% per year) are forecast to grow faster than the Australian market (9.6% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: ALX's revenue (4.8% per year) is forecast to grow faster than the Australian market (3.8% per year).

High Growth Revenue: ALX's revenue (4.8% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: ALX's Return on Equity is forecast to be low in 3 years time (9.9%).


Next Steps

Past Performance

How has Atlas Arteria performed over the past 5 years?

21.5%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: ALX has a large one-off loss of A$51.5M impacting its June 30 2019 financial results.

Growing Profit Margin: ALX's current net profit margins (11.1%) are lower than last year (65.5%).


Past Earnings Growth Analysis

Earnings Trend: ALX has become profitable over the past 5 years, growing earnings by 21.5% per year.

Accelerating Growth: ALX's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: ALX had negative earnings growth (-77.5%) over the past year, making it difficult to compare to the Infrastructure industry average (-19.5%).


Return on Equity

High ROE: ALX's Return on Equity (-0.6%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Atlas Arteria's financial position?


Financial Position Analysis

Short Term Liabilities: ALX's short term assets (A$153.5M) exceed its short term liabilities (A$86.0M).

Long Term Liabilities: ALX's short term assets (A$153.5M) do not cover its long term liabilities (A$2.2B).


Debt to Equity History and Analysis

Debt Level: ALX's debt to equity ratio (100.5%) is considered high.

Reducing Debt: Insufficient data to determine if ALX's debt to equity ratio has reduced over the past 5 years.

Debt Coverage: ALX's debt is not well covered by operating cash flow (1.6%).

Interest Coverage: Insufficient data to determine if ALX's interest payments on its debt are well covered by EBIT.


Balance Sheet

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

Debt Coverage by Assets: ALX's debt is not covered by short term assets (assets are 0.1x debt).


Next Steps

Dividend

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

3.72%

Current Dividend Yield


Dividend Yield vs Market

company3.7%marketbottom25%2.4%markettop25%5.5%industryaverage3.4%forecastin3Years4.8%

Current dividend yield vs market & industry

Notable Dividend: ALX's dividend (3.62%) is higher than the bottom 25% of dividend payers in the Australian market (2.34%).

High Dividend: ALX's dividend (3.62%) is low compared to the top 25% of dividend payers in the Australian market (5.47%).


Stability and Growth of Payments

Stable Dividend: Whilst dividend payments have been stable, ALX has been paying a dividend for less than 10 years.

Growing Dividend: ALX's dividend payments have increased, but the company has only paid a dividend for 7 years.


Current Payout to Shareholders

Dividend Coverage: With its high payout ratio (1265.7%), ALX's dividend payments are not well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: ALX's dividends in 3 years are not forecast to be well covered by earnings (116.2% payout ratio).


Next Steps

Management

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

0.8yrs

Average management tenure


CEO

Graeme Bevans (61yo)

0.8yrs

Tenure

0

Mr. Graeme Francis Bevans serves as Chief Executive Officer and Director at Atlas Arteria Limited since April 1, 2019. Mr. Bevans was a Partner at Alinda Capital Partners LLC since 2010. Mr. Bevans focused ...


Management Age and Tenure

0.8yrs

Average Tenure

Experienced Management: ALX's management team is not considered experienced ( 0.8 years average tenure), which suggests a new team.


Board Age and Tenure

1.3yrs

Average Tenure

59yo

Average Age

Experienced Board: ALX's board of directors are not considered experienced ( 1.3 years average tenure), which suggests a new board.


Insider Trading

Insider Buying: ALX insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

SellAU$39,090,18115 Jan 20
Yarra Funds Management Limited
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Nora Scheinkestel
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Chairman of the Board
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Debra Goodin
EntityIndividual
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Member of the Board of Directors
Independent Non-Executive Director
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David Bartholomew
EntityIndividual
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Member of the Board of Directors
Independent Non Executive Director
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Jean-Georges Malcor
EntityIndividual
Role
Member of the Board of Directors
Independent Non-Executive Director
Shares3,238
Max PriceAU$6.90
BuyAU$100,16720 Dec 19
Graeme Bevans
EntityIndividual
Role
Chief Executive Officer
CEO & Director
Shares14,517
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Debra Goodin
EntityIndividual
Role
Member of the Board of Directors
Independent Non-Executive Director
Shares2,594
Max PriceAU$7.70
BuyAU$79,99402 Dec 19
David Bartholomew
EntityIndividual
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Member of the Board of Directors
Independent Non Executive Director
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Nora Scheinkestel
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Chairman of the Board
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Macquarie Capital Investment Management LLC
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Macquarie Group, Ltd., Banking & Securities Investments
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Yarra Funds Management Limited
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Macquarie Capital Investment Management LLC
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Macquarie Investment Management Limited
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Macquarie Group, Ltd., Banking & Securities Investments
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Macquarie Capital Investment Management LLC
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Macquarie Group, Ltd., Banking & Securities Investments
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Max PriceAU$7.34
BuyAU$123,78502 Apr 19
Jean-Georges Malcor
EntityIndividual
Role
Member of the Board of Directors
Independent Non-Executive Director
Shares17,000
Max PriceAU$7.28
BuyAU$19,78207 Mar 19
Nora Scheinkestel
EntityIndividual
Role
Chairman of the Board
Independent Non-Executive Chairman
Shares2,867
Max PriceAU$6.90
BuyAU$99,59504 Mar 19
Debra Goodin
EntityIndividual
Role
Member of the Board of Directors
Independent Non-Executive Director
Shares14,476
Max PriceAU$6.88
BuyAU$60,23704 Mar 19
David Bartholomew
EntityIndividual
Role
Member of the Board of Directors
Independent Non Executive Director
Shares8,730
Max PriceAU$6.90
SellAU$018 Feb 19
Macquarie Investment Management Limited
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Max PriceAU$6.95
SellAU$018 Feb 19
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Macquarie Capital Investment Management LLC
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Max PriceAU$6.98
BuyAU$018 Feb 19
Macquarie Investment Management Limited
EntityCompany
Shares2,778,258
Max PriceAU$7.00
SellAU$79,96018 Feb 19
Macquarie Capital Investment Management LLC
EntityCompany
Shares97,603
Max PriceAU$6.85
BuyAU$018 Feb 19
Macquarie Investment Management Limited
EntityCompany
Shares3,581,939
Max PriceAU$6.95

Ownership Breakdown

Dilution of Shares: Shareholders have been substantially diluted in the past year, with total shares outstanding growing by 82.9%.


Management Team

  • Graeme Bevans (61yo)

    CEO & Director

    • Tenure: 0.8yrs
  • Clayton McCormack

    Company Secretary & General Counsel

    • Tenure: 0.8yrs
  • Nadine Lennie (46yo)

    Chief Financial Officer

    • Tenure: 0.8yrs
  • Navleen Prasad

    Public Affairs Manager

    • Phillipa Chen

      Head of Investor Relations

      • Vincent Portal-Barrault

        Chief Operating Officer

        • Tenure: 0.8yrs

      Board Members

      • NL Scheinkestel (59yo)

        Independent Non-Executive Chairman

        • Tenure: 4.8yrs
        • Compensation: AU$210.00k
      • Graeme Bevans (61yo)

        CEO & Director

        • Tenure: 0.8yrs
      • Jean-Georges Malcor (63yo)

        Independent Non-Executive Director

        • Tenure: 1.2yrs
        • Compensation: AU$24.58k
      • David Bartholomew (58yo)

        Independent Non Executive Director

        • Tenure: 1.3yrs
        • Compensation: AU$35.42k
      • Debbie Goodin (52yo)

        Independent Non-Executive Director

        • Tenure: 2.3yrs
        • Compensation: AU$178.13k

      Company Information

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


      Key Information

      • Name: Atlas Arteria Limited
      • Ticker: ALX
      • Exchange: ASX
      • Founded: 2009
      • Industry: Highways and Railtracks
      • Sector: Transportation
      • Market Cap: AU$7.076b
      • Shares outstanding: 879.02m
      • Website: https://www.atlasarteria.com

      Location

      • Atlas Arteria Limited
      • 50 Martin Place
      • Level 7
      • Sydney
      • New South Wales
      • 2000
      • Australia

      Listings

      TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
      ALXASX (Australian Securities Exchange)YesStapled SecuritiesAUAUDJan 2010
      M82DB (Deutsche Boerse AG)YesStapled SecuritiesDEEURJan 2010
      MAQA.FOTCPK (Pink Sheets LLC)YesStapled SecuritiesUSUSDJan 2010
      ALXCHIA (Chi-X Australia)YesStapled SecuritiesAUAUDJan 2010

      Biography

      Atlas Arteria Limited invests in infrastructure and non-infrastructure assets. It holds a 13.4% interest in TRIP II, the concessionaire for Dulles Greenway toll road located in northern Virginia, the United States. The company was formerly known as Macquarie Atlas Roads Limited and changed its name to Atlas Arteria Limited in May 2018. Atlas Arteria Limited was incorporated in 2009 and is based in Sydney, Australia. 


      Company Analysis and Financial Data Status

      All financial data provided by Standard & Poor's Capital IQ.
      DataLast Updated (UTC time)
      Company Analysis2020/01/22 10:38
      End of Day Share Price2020/01/22 00:00
      Earnings2019/06/30
      Annual Earnings2018/12/31


      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.