NYSE:ALG

Stock Analysis Report

NOT FOR DISTRIBUTION
Header cover image

Executive Summary

Alamo Group Inc. designs, manufactures, distributes, and services agricultural and infrastructure maintenance equipment for governmental and industrial use worldwide. More Details


Snowflake Analysis

Adequate balance sheet with moderate growth potential.


Similar Companies

Share Price & News

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


Latest Share Price and Events

Stable Share Price: ALG is less volatile than 75% of US stocks over the past 3 months, typically moving +/- 5% a week.

Volatility Over Time: ALG's weekly volatility (5%) has been stable over the past year.


Market Performance


7 Day Return

0.8%

ALG

1.7%

US Machinery

2.1%

US Market


1 Year Return

16.5%

ALG

18.2%

US Machinery

19.8%

US Market

Return vs Industry: ALG underperformed the US Machinery industry which returned 18.2% over the past year.

Return vs Market: ALG underperformed the US Market which returned 19.7% over the past year.


Shareholder returns

ALGIndustryMarket
7 Day0.8%1.7%2.1%
30 Day13.1%13.7%8.1%
90 Day22.4%15.2%6.0%
1 Year17.0%16.5%21.3%18.2%22.5%19.8%
3 Year17.5%15.8%31.2%21.8%46.5%36.8%
5 Year154.5%148.2%127.2%101.8%96.9%75.3%

Long-Term Price Volatility Vs. Market

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


Simply Wall St News

Valuation

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

27.66x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: ALG ($136.61) is trading above our estimate of fair value ($74.12)

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


Price To Earnings Ratio

PE vs Industry: ALG is good value based on its PE Ratio (27.7x) compared to the US Machinery industry average (29.8x).

PE vs Market: ALG is poor value based on its PE Ratio (27.7x) compared to the US market (19.7x).


Price to Earnings Growth Ratio

PEG Ratio: ALG is poor value based on its PEG Ratio (1.1x)


Price to Book Ratio

PB vs Industry: ALG's PB Ratio (2.7x) is in line with the US Machinery industry average.


Next Steps

Future Growth

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

24.1%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: ALG's forecast earnings growth (24.1% per year) is above the savings rate (2.2%).

Earnings vs Market: ALG's earnings (24.1% per year) are forecast to grow faster than the US market (22% per year).

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

Revenue vs Market: ALG's revenue (6.3% per year) is forecast to grow slower than the US market (10.2% per year).

High Growth Revenue: ALG's revenue (6.3% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: ALG's Return on Equity is forecast to be low in 3 years time (12.6%).


Next Steps

Past Performance

How has Alamo Group performed over the past 5 years?

10.6%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: ALG has high quality earnings.

Growing Profit Margin: ALG's current net profit margins (4.9%) are lower than last year (6.5%).


Past Earnings Growth Analysis

Earnings Trend: ALG's earnings have grown by 10.6% per year over the past 5 years.

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

Earnings vs Industry: ALG had negative earnings growth (-16.8%) over the past year, making it difficult to compare to the Machinery industry average (-15.6%).


Return on Equity

High ROE: ALG's Return on Equity (9.6%) is considered low.


Next Steps

Financial Health

How is Alamo Group's financial position?


Financial Position Analysis

Short Term Liabilities: ALG's short term assets ($567.2M) exceed its short term liabilities ($157.7M).

Long Term Liabilities: ALG's short term assets ($567.2M) exceed its long term liabilities ($410.6M).


Debt to Equity History and Analysis

Debt Level: ALG's debt to equity ratio (61.8%) is considered high.

Reducing Debt: ALG's debt to equity ratio has increased from 49.3% to 61.8% over the past 5 years.

Debt Coverage: ALG's debt is well covered by operating cash flow (48.3%).

Interest Coverage: ALG's interest payments on its debt are well covered by EBIT (6x coverage).


Balance Sheet


Next Steps

Dividend

What is Alamo Group current dividend yield, its reliability and sustainability?

0.38%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: ALG's dividend (0.38%) isn’t notable compared to the bottom 25% of dividend payers in the US market (1.47%).

High Dividend: ALG's dividend (0.38%) is low compared to the top 25% of dividend payers in the US market (4.05%).


Stability and Growth of Payments

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

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


Current Payout to Shareholders

Dividend Coverage: ALG is not paying a notable dividend for the US market.


Future Payout to Shareholders

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


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

9.7yrs

Average management tenure


CEO

Ron Robinson (68 yo)

21.33yrs

Tenure

US$3,200,896

Compensation

Mr. Ronald A. Robinson, also known as Ron, has been the Chief Executive Officer and President of Alamo Group Inc. since July 7, 1999 and served as its Interim Chairman of the Board from November 30, 2017 t...


CEO Compensation Analysis

Compensation vs Market: Ron's total compensation ($USD3.20M) is about average for companies of similar size in the US market ($USD4.15M).

Compensation vs Earnings: Ron's compensation has been consistent with company performance over the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Ronald Robinson
President21.33yrsUS$3.20m2.01%
$ 32.6m
Dan Malone
Executive VP13.83yrsUS$802.96k0.11%
$ 1.8m
Edward Rizzuti
VP, General Counsel & Secretary5.33yrsUS$809.19k0.044%
$ 715.7k
Jeffery Leonard
Executive Vice President of Industrial Divisionno dataUS$1.18m0.13%
$ 2.0m
Richard Raborn
Executive Vice President of Agricultural Division5.58yrsUS$799.58k0.066%
$ 1.1m
Janet Pollock
Vice President of Human Resources2.5yrsno data0.015%
$ 240.7k
Richard Wehrle
VP, Controller & Treasurer19.5yrsUS$375.63k0.20%
$ 3.3m

9.7yrs

Average Tenure

60yo

Average Age

Experienced Management: ALG's management team is seasoned and experienced (9.7 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Ronald Robinson
President21.33yrsUS$3.20m2.01%
$ 32.6m
Richard Parod
Independent Director2.92yrsUS$177.00k0.043%
$ 699.0k
Roderick Baty
Independent Chairman of the Board2.5yrsUS$195.20k0.17%
$ 2.7m
Lorie Tekorius
Independent Director0.92yrUS$60.78k0.011%
$ 185.2k
Robert Bauer
Independent Director5.25yrsUS$174.20k0.056%
$ 908.1k
Eric Etchart
Independent Director5.25yrsUS$186.20k0.064%
$ 1.0m
Tracy Jokinen
Independent Director4.25yrsUS$184.40k0.038%
$ 619.6k

4.3yrs

Average Tenure

63yo

Average Age

Experienced Board: ALG's board of directors are considered experienced (4.3 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: ALG insiders have only sold shares in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Alamo Group Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Alamo Group Inc.
  • Ticker: ALG
  • Exchange: NYSE
  • Founded: 1955
  • Industry: Construction Machinery and Heavy Trucks
  • Sector: Capital Goods
  • Market Cap: US$1.623b
  • Shares outstanding: 11.88m
  • Website: https://www.alamo-group.com

Number of Employees


Location

  • Alamo Group Inc.
  • 1627 East Walnut Street
  • Seguin
  • Texas
  • 78155
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
ALGNYSE (New York Stock Exchange)YesCommon StockUSUSDMar 1993
AL3DB (Deutsche Boerse AG)YesCommon StockDEEURMar 1993

Biography

Alamo Group Inc. designs, manufactures, distributes, and services agricultural and infrastructure maintenance equipment for governmental and industrial use worldwide. The company offers hydraulically-power...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/11/26 23:13
End of Day Share Price2020/11/25 00:00
Earnings2020/09/30
Annual Earnings2019/12/31


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.