Albany International (AIN): Examining Valuation Following Prolonged Share Price Weakness

Albany International (AIN) has seen its stock struggle to hold momentum this year, with performance in the red over the past month and year to date. Investors are watching the company’s next steps as the market recalibrates.

See our latest analysis for Albany International.

Albany International’s share price has struggled to gain traction, down more than 29% so far this year and showing a 23% decline in total return over the past twelve months. Recent lack of sustained momentum suggests that investors are wary, even as the company’s longer-term total return remains positive over five years.

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After this extended slide in share price, investors are left wondering whether Albany International is now trading at a discount compared to its fundamentals, or if the market has already accounted for any future growth potential.

Most Popular Narrative: 12.9% Undervalued

With Albany International's fair value narrative calculated at $64.50 per share and a last close at $56.16, this signals a notable valuation discrepancy. Market watchers will want to know the key drivers that justify pricing in this gap.

Accelerating adoption of lightweight composites in aerospace and defense, as demonstrated by expanding content on next-generation aircraft, ramping on key programs like CH-53K, LEAP, and Bell 525, and new applications such as 3D woven parts replacing titanium, positions Albany's Engineered Composites segment for significant high-margin revenue and earnings expansion. Investments in process automation, facility rationalization, and supply chain improvements (like S/4HANA implementation and optimized global footprint) are expected to yield operating leverage, drive cost efficiencies, and expand operating margins in the next several years.

Read the complete narrative.

What numbers are driving this bullish stance? Hints: One segment could soon deliver outsized margins, and the forward profit multiple in this narrative might surprise you. Ready to uncover which financial assumptions lie beneath the surface? The story behind this valuation turns conventional wisdom on its head.

Result: Fair Value of $64.50 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, persistent declines in traditional paper goods demand and delays in ramping up key aerospace programs could present challenges to Albany’s path to long-term growth.

Find out about the key risks to this Albany International narrative.

Another View: SWS DCF Model Offers a Different Perspective

While analysts see Albany International as undervalued based on future earnings growth, our SWS DCF model comes to a less optimistic conclusion. According to this cash flow-based approach, the shares are actually trading above their fair value. This suggests the market may be factoring in more optimism than fundamentals warrant. Could the gap between these two models signal a valuation risk that investors should watch closely?

Look into how the SWS DCF model arrives at its fair value.

Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out Albany International for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover undervalued stocks based on their cash flows. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity.

Build Your Own Albany International Narrative

If you see the story differently or want to dive into the numbers for yourself, you can build your own narrative in just a few minutes and Do it your way.

A great starting point for your Albany International research is our analysis highlighting 2 key rewards and 1 important warning sign that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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