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Arconic

NYSE:ARNC
Snowflake Description

Fair value with limited growth.

The Snowflake is generated from 30 checks in 5 different areas, read more below.
ARNC
NYSE
$10B
Market Cap
  1. Home
  2. US
  3. Capital Goods
Company description

Arconic Inc. engineers, manufactures, and sells lightweight metals worldwide. The last earnings update was 48 days ago. More info.


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ARNC Share Price and Events
7 Day Returns
-0.6%
NYSE:ARNC
-2.2%
US Aerospace & Defense
0.3%
US Market
1 Year Returns
31.5%
NYSE:ARNC
0.8%
US Aerospace & Defense
0.7%
US Market
ARNC Shareholder Return
  7 Day 30 Day 90 Day 1 Year 3 Year 5 Year
Arconic (ARNC) -0.6% 4.2% 19.9% 31.5% - -
US Aerospace & Defense -2.2% 0.9% 6% 0.8% 41.6% 59%
US Market 0.3% 0.4% 0.6% 0.7% 37.2% 37.4%
1 Year Return vs Industry and Market
  • ARNC outperformed the Aerospace & Defense industry which returned 0.8% over the past year.
  • ARNC outperformed the Market in United States of America which returned 0.7% over the past year.
Price Volatility
ARNC
Industry
5yr Volatility vs Market

ARNC Value

 Is Arconic undervalued based on future cash flows and its price relative to the stock market?

Value is all about what a company is worth versus what price it is available for. If you went into a grocery store and all the bananas were on sale at half price, they could be considered undervalued.
INTRINSIC VALUE BASED ON FUTURE CASH FLOWS
Here we compare the current share price of Arconic to its discounted cash flow analysis.value.

The discounted cash flow value is simply looking at what the company is worth today, based on estimates of how much money it is expected to make in the future.
Raw Data

Below are the data sources, inputs and calculation used to determine the intrinsic value for Arconic.

NYSE:ARNC Discounted Cash Flow Data Sources
Data Point Source Value
Valuation Model 2 Stage Free Cash Flow to Equity
Levered Free Cash Flow Average of 11 Analyst Estimates (S&P Global) See below
Discount Rate (Cost of Equity) See below 10%
Perpetual Growth Rate 10-Year US Government Bond Rate 2.7%

An important part of a discounted cash flow is the discount rate, below we explain how it has been calculated.

Calculation of Discount Rate/ Cost of Equity for NYSE:ARNC
Data Point Calculation/ Source Result
Risk-Free Rate 10-Year US Govt Bond Rate 2.7%
Equity Risk Premium S&P Global 6%
Aerospace & Defense Unlevered Beta Simply Wall St/ S&P Global 0.87
Re-levered Beta = Unlevered beta (1 + (1- tax rate) (Debt/Equity))
= 0.875 (1 + (1- 21%) (64.72%))
1.215
Levered Beta Levered Beta limited to 0.8 to 2.0
(practical range for a stable firm)
1.22
Discount Rate/ Cost of Equity = Cost of Equity = Risk Free Rate + (Levered Beta * Equity Risk Premium)
= 2.73% + (1.215 * 5.96%)
9.97%

Discounted Cash Flow Calculation for NYSE:ARNC using 2 Stage Free Cash Flow to Equity Model

The calculations below outline how an intrinsic value for Arconic is arrived at by discounting future cash flows to their present value using the 2 stage method. We try to start with analysts estimates of free cash flow, however if these are not available we use the most recent financial results. In the 1st stage we continue to grow the free cash flow over a 10 year period, with the growth rate trending towards the perpetual growth rate used in the 2nd stage. The 2nd stage assumes the company grows at a stable rate into perpetuity.

NYSE:ARNC DCF 1st Stage: Next 10 year cash flow forecast
Levered FCF (USD, Millions) Source Present Value
Discounted (@ 9.97%)
2019 668.67 Analyst x3 608.02
2020 930.50 Analyst x4 769.37
2021 904.00 Analyst x1 679.67
2022 914.00 Analyst x1 624.86
2023 942.00 Analyst x1 585.59
2024 952.90 Est @ 1.16% 538.64
2025 968.42 Est @ 1.63% 497.77
2026 987.39 Est @ 1.96% 461.49
2027 1,009.02 Est @ 2.19% 428.82
2028 1,032.75 Est @ 2.35% 399.10
Present value of next 10 years cash flows $5,593.33
NYSE:ARNC DCF 2nd Stage: Terminal Value
Calculation Result
Terminal Value = FCF2028 × (1 + g) ÷ (Discount Rate – g)
= $1,032.75 × (1 + 2.73%) ÷ (9.97% – 2.73%)
$14,645.35
Present Value of Terminal Value = Terminal Value ÷ (1 + r)10
= $14,645.35 ÷ (1 + 9.97%)10
$5,659.65
NYSE:ARNC Total Equity Value
Calculation Result
Total Equity Value = Present value of next 10 years cash flows + Terminal Value
= $5,593.33 + $5,659.65
$11,252.98
Equity Value per Share
(USD)
= Total value / Shares Outstanding
= $11,252.98 / 448.63
$25.08
NYSE:ARNC Discount to Share Price
Calculation Result
Value per share (USD) From above. $25.08
Current discount Discount to share price of $22.88
= -1 x ($22.88 - $25.08) / $25.08
8.8%

Learn more about our DCF calculations in Simply Wall St’s analysis model .

Current Discount
Amount off the current price Arconic is available for.
Intrinsic value
9%
Share price is $22.88 vs Future cash flow value of $25.08
Current Discount Checks
For Arconic to be considered undervalued it must be available for at least 20% below the current price. Less than 40% is even better.
  • Arconic's share price is below the future cash flow value, but not at a moderate discount (< 20%).
  • Arconic's share price is below the future cash flow value, but not at a substantial discount (< 40%).
PRICE RELATIVE TO MARKET
We can also value a company based on what the stock market is willing to pay for it. This is similar to the price of fruit (e.g. Mangoes or Avocados) increasing when they are out of season, or how much your home is worth.

The amount the stock market is willing to pay for Arconic's earnings, growth and assets is considered below, and whether this is a fair price.
Price based on past earnings
Are Arconic's earnings available for a low price, and how does this compare to other companies in the same industry?
Raw Data
NYSE:ARNC PE (Price to Earnings) Ratio Data Sources
Data Point Source Value
Earnings Per Share * Company Filings (2019-03-31) in USD $1.42
NYSE:ARNC Share Price ** NYSE (2019-06-17) in USD $22.88
United States of America Aerospace & Defense Industry PE Ratio Median Figure of 38 Publicly-Listed Aerospace & Defense Companies 22.79x
United States of America Market PE Ratio Median Figure of 3,093 Publicly-Listed Companies 17.68x

* Trailing twelve months (TTM) annual GAAP earnings per share excluding extraordinary items.

** Primary Listing of Arconic.

NYSE:ARNC PE (Price to Earnings) Ratio Calculation
Calculation Outcome
PE Ratio

= NYSE:ARNC Share Price ÷ EPS (both in USD)

= 22.88 ÷ 1.42

16.06x

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • Arconic is good value based on earnings compared to the US Aerospace & Defense industry average.
  • Arconic is good value based on earnings compared to the United States of America market.
Price based on expected Growth
Does Arconic's expected growth come at a high price?
Raw Data
NYSE:ARNC PEG (Price to Earnings to Growth) Ratio Data Sources
Data Point Source Value
PE Ratio See PE Ratio Section 16.06x
Net Income Annual Growth Rate See Future Growth Section.
Line of Best Fit* through Consensus Estimate Earnings of 11 Analysts
15.7%per year
United States of America Aerospace & Defense Industry PEG Ratio Median Figure of 33 Publicly-Listed Aerospace & Defense Companies 1.92x
United States of America Market PEG Ratio Median Figure of 2,125 Publicly-Listed Companies 1.52x

*Line of best fit is calculated by linear regression .

NYSE:ARNC PEG (Price to Earnings to Growth) Ratio Calculation
Calculation Outcome
PEG Ratio

= PE Ratio ÷ Net Income Annual Growth Rate

= 16.06x ÷ 15.7%

1.02x

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • Arconic is poor value based on expected growth next year.
Price based on value of assets
What value do investors place on Arconic's assets?
Raw Data
NYSE:ARNC PB (Price to Book) Ratio Data Sources
Data Point Source Value
Book Value per Share Company Filings (2019-03-31) in USD $11.28
NYSE:ARNC Share Price * NYSE (2019-06-17) in USD $22.88
United States of America Aerospace & Defense Industry PB Ratio Median Figure of 55 Publicly-Listed Aerospace & Defense Companies 2.69x
United States of America Market PB Ratio Median Figure of 5,245 Publicly-Listed Companies 1.79x
NYSE:ARNC PB (Price to Book) Ratio Calculation
Calculation Outcome
PB Ratio

= NYSE:ARNC Share Price ÷ Book Value per Share (both in USD)

= 22.88 ÷ 11.28

2.03x

* Primary Listing of Arconic.

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • Arconic is good value based on assets compared to the US Aerospace & Defense industry average.
X
Value checks
We assess Arconic's value by looking at:
  1. Is the discounted cash flow value less than 20%, or 40% of the share price? (2 checks) ( Click here or on bar chart for details of DCF calculation. )
  2. Is the PE ratio less than the market average, and/ or less than the Aerospace & Defense industry average (and greater than 0)? (2 checks)
  3. Is the PEG ratio within a reasonable range (0 to 1)? (1 check)
  4. Is the PB ratio less than the Aerospace & Defense industry average (and greater than 0)? (1 check)
  5. Arconic has a total score of 3/6, see the detailed checks below.

    Note: We use GAAP Earnings per Share in all our calculations including PE and PEG Ratio.

    Full details on the Value part of the Simply Wall St company analysis model.

ARNC Future Performance

 How is Arconic expected to perform in the next 1 to 3 years based on estimates from 11 analysts?

The future performance of a company is measured in the same way as past performance, by looking at estimated growth and how much profit it is expected to make.

Future estimates come from professional analysts. Just like forecasting the weather, they don’t always get it right!
Annual Growth Rate
15.7%
Expected annual growth in earnings.
Earnings growth vs Low Risk Savings
Is Arconic expected to grow at an attractive rate?
  • Arconic's earnings growth is expected to exceed the low risk savings rate of 2.7%.
Growth vs Market Checks
  • Arconic's earnings growth is expected to exceed the United States of America market average.
  • Arconic's revenue growth is positive but not above the United States of America market average.
Annual Growth Rates Comparison
Raw Data
NYSE:ARNC Future Growth Rates Data Sources
Data Point Source Value (per year)
NYSE:ARNC Future Earnings Growth Rate Line of Best Fit* through Consensus Estimate Earnings of 11 Analysts 15.7%
NYSE:ARNC Future Revenue Growth Rate Line of Best Fit* through Consensus Estimate Revenue of 11 Analysts 3.1%
United States of America Aerospace & Defense Industry Earnings Growth Rate Market Cap Weighted Average 10.6%
United States of America Aerospace & Defense Industry Revenue Growth Rate Market Cap Weighted Average 5.1%
United States of America Market Earnings Growth Rate Market Cap Weighted Average 13.8%
United States of America Market Revenue Growth Rate Market Cap Weighted Average 7.3%

*Line of best fit is calculated by linear regression .

Industry and Market average data is calculated daily.

Learn more about our growth rate calculations in Simply Wall St’s analysis model.

Analysts growth expectations
Raw Data
NYSE:ARNC Analysts Growth Expectations Data Sources
Data Point Source Value
Past Financials Company Filings (2 months ago) See Below
Future Estimates Average of up to 11 Analyst Estimates (S&P Global) See Below
All numbers in USD Millions and using Trailing twelve months (TTM) annual period rather than quarterly.
NYSE:ARNC Future Estimates Data
Date (Data in USD Millions) Revenue Cash Flow Net Income * Avg. No. Analysts
2023-12-31 16,135 1
2022-12-31 15,768 1
2021-12-31 15,447 4
2020-12-31 14,989 1,428 965 11
2019-12-31 14,419 1,244 860 11
NYSE:ARNC Past Financials Data
Date (Data in USD Millions) Revenue Cash Flow Net Income *
2019-03-31 14,110 395 684
2018-12-31 14,014 217 640
2018-09-30 13,813 125 -305
2018-06-30 13,525 17 -364
2018-03-31 13,213 -80 -290
2017-12-31 12,960 -39 -127
2017-09-30 12,656 289 -708
2017-06-30 12,558 652 -760
2017-03-31 12,531 905 -918
2016-12-31 12,394 95 -1,131

*GAAP earnings excluding extraordinary items.

Super high growth metrics
High Growth Checks
  • Arconic's earnings are expected to grow by 15.7% yearly, however this is not considered high growth (20% yearly).
  • Arconic's revenue is expected to grow by 3.1% yearly, however this is not considered high growth (20% yearly).
Past and Future Earnings per Share
The accuracy of the analysts who estimate the future performance data can be gauged below. We look back 3 years and see if they were any good at predicting what actually occurred. We also show the highest and lowest estimates looking forward to see if there is a wide range.
Raw Data
NYSE:ARNC Past and Future Earnings per Share
Data Point Source Value
Past Financials Company Filings (2 months ago) See Below
Future Estimates Average of up to 11 Analyst Estimates (S&P Global) See Below

All data from Arconic Company Filings, last reported 2 months ago, and in Trailing twelve months (TTM) annual period rather than quarterly.

NYSE:ARNC Future Estimates Data
Date (Data in USD Millions) EPS * EPS High Estimate EPS Low Estimate Avg. No. Analysts
2023-12-31
2022-12-31
2021-12-31
2020-12-31 2.04 2.16 1.97 5.00
2019-12-31 1.75 1.83 1.68 4.00
NYSE:ARNC Past Financials Data
Date (Data in USD Millions) EPS *
2019-03-31 1.42
2018-12-31 1.33
2018-09-30 -0.63
2018-06-30 -0.77
2018-03-31 -0.63
2017-12-31 -0.28
2017-09-30 -1.61
2017-06-30 -1.73
2017-03-31 -2.09
2016-12-31 -2.58

*GAAP earnings excluding extraordinary items.

Performance in 3 years
In the same way as past performance we look at the future estimated return (profit) compared to the available funds. We do this looking forward 3 years.
  • Arconic is not expected to efficiently use shareholders’ funds in the future (Return on Equity less than 20%).
X
Future performance checks
We assess Arconic's future performance by looking at:
  1. Is the annual earnings growth rate expected to beat the low risk savings rate, plus a premium to keep pace with inflation?
  2. Is the annual earnings growth rate expected to beat the average growth rate in earnings of the United States of America market? (1 check)
  3. Is the annual revenue growth rate expected to beat the average growth rate in revenue of the United States of America market? (1 check)
  4. Is the annual earnings growth rate expected to be above 20%? (1 check)
  5. Is the annual revenue growth rate expected to be above 20%? (1 check)
  6. Is the Return on Equity in 3 years expected to be over 20%? (1 check)
Some of the above checks will fail if the company is expected to be loss making in the relevant year.
Arconic has a total score of 2/6, see the detailed checks below.

Note 1: We use GAAP Net Income Excluding Exceptional Items for our Earnings in all our calculations.

Full details on the Future part of the Simply Wall St company analysis model.

ARNC Past Performance

  How has Arconic performed over the past 5 years?

The past performance of a company can be measured by how much growth it has experienced and how much profit it makes relative to the funds and assets it has available.
Past earnings growth
Below we compare Arconic's growth in the last year to its industry (Aerospace & Defense).
Past Earnings growth analysis
We also check if the company has grown in the past 5 years, and whether it has maintained that growth in the year.
  • Arconic has delivered over 20% year on year earnings growth in the past 5 years.
  • Arconic has become profitable in the last year making the earnings growth rate difficult to compare to the 5-year average.
  • Arconic has become profitable in the last year making it difficult to compare the US Aerospace & Defense industry average.
Earnings and Revenue History
Arconic's revenue and profit over the past 5 years is shown below, any years where they have experienced a loss will show up in red.
Raw Data

All data from Arconic Company Filings, last reported 2 months ago, and in Trailing twelve months (TTM) annual period rather than quarterly.

NYSE:ARNC Past Revenue, Cash Flow and Net Income Data
Date (Data in USD Millions) Revenue Net Income * G+A Expenses R&D Expenses
2019-03-31 14,110.00 684.00 720.00 102.00
2018-12-31 14,014.00 640.00 716.00 103.00
2018-09-30 13,813.00 -305.00 700.00 105.00
2018-06-30 13,525.00 -364.00 796.00 104.00
2018-03-31 13,213.00 -290.00 838.00 104.00
2017-12-31 12,960.00 -127.00 837.00 109.00
2017-09-30 12,656.00 -708.00 853.00 120.00
2017-06-30 12,558.00 -760.00 767.00 126.00
2017-03-31 12,531.00 -918.00 761.00 129.00
2016-12-31 12,394.00 -1,131.00 866.00 130.00
2015-12-31 12,413.00 -226.00 716.00 169.00
2014-12-31 12,542.00 -82.00 728.00 123.00

*GAAP earnings excluding extraordinary items.

Performance last year
We want to ensure a company is making the most of what it has available. This is done by comparing the return (profit) to a company's available funds, assets and capital.
  • Arconic has not efficiently used shareholders’ funds last year (Return on Equity less than 20%).
  • Arconic used its assets less efficiently than the US Aerospace & Defense industry average last year based on Return on Assets.
  • Arconic has significantly improved its use of capital last year versus 3 years ago (Return on Capital Employed).
X
Past performance checks
We assess Arconic's performance over the past 5 years by checking for:
  1. Has earnings increased in past 5 years? (1 check)
  2. Has the earnings growth in the last year exceeded that of the Aerospace & Defense industry? (1 check)
  3. Is the recent earnings growth over the last year higher than the average annual growth over the past 5 years? (1 check)
  4. Is the Return on Equity (ROE) higher than 20%? (1 check)
  5. Is the Return on Assets (ROA) above industry average? (1 check)
  6. Has the Return on Capital Employed (ROCE) increased from 3 years ago? (1 check)
The above checks will fail if the company has reported a loss in the most recent earnings report. Some checks require at least 3 or 5 years worth of data.
Arconic has a total score of 2/6, see the detailed checks below.

Note: We use GAAP Net Income excluding extraordinary items in all our calculations.

Full details on the Past part of the Simply Wall St company analysis model.

ARNC Health

 How is Arconic's financial health and their level of debt?

A company's financial position is much like your own financial position, it includes everything you own (assets) and owe (liabilities).

The boxes below represent the relative size of what makes up Arconic's finances.

The net worth of a company is the difference between its assets and liabilities.
Net Worth
  • Arconic is able to meet its short term (1 year) commitments with its holdings of cash and other short term assets.
  • Arconic's long term commitments exceed its cash and other short term assets.
Balance sheet
This treemap shows a more detailed breakdown of Arconic's finances. If any of them are yellow this indicates they may be out of proportion and red means they relate to one of the checks below.
Assets
Liabilities and shares
The 'shares' portion represents any funds contributed by the owners (shareholders) and any profits.
  • High level of physical assets or inventory.
  • Debt is covered by short term assets, assets are 1x debt.
Historical Debt
Nearly all companies have debt. Debt in itself isn’t bad, however if the debt is too high, or the company can’t afford to pay the interest on its debts this may have impacts in the future.

The graphic below shows equity (available funds) and debt, we ideally want to see the red area (debt) decreasing.

If there is any debt we look at the companies capability to repay it, and whether the level has increased over the past 5 years.
Raw Data

All data from Arconic Company Filings, last reported 2 months ago.

NYSE:ARNC Past Debt and Equity Data
Date (Data in USD Millions) Total Equity Total Debt Cash & Short Term Investments
2019-03-31 5,178.00 6,643.00 1,319.00
2018-12-31 5,585.00 6,330.00 2,277.00
2018-09-30 5,375.00 6,357.00 1,535.00
2018-06-30 5,218.00 6,357.00 1,455.00
2018-03-31 5,282.00 6,354.00 1,205.00
2017-12-31 4,924.00 6,844.00 2,150.00
2017-09-30 5,961.00 6,857.00 1,815.00
2017-06-30 5,753.00 6,844.00 1,785.00
2017-03-31 5,495.00 8,093.00 2,553.00
2016-12-31 5,141.00 8,084.00 1,863.00
2015-12-31 14,131.00 8,827.00 1,362.00
2014-12-31
  • Arconic's level of debt (122.3%) compared to net worth is high (greater than 40%).
  • Unable to establish if Arconic's debt level has increased without past 5-year debt data.
  • Debt is not well covered by operating cash flow (6.2%, less than 20% of total debt).
  • Interest payments on debt are well covered by earnings (EBIT is 3.9x coverage).
X
Financial health checks
We assess Arconic's financial health by checking for:
  1. Are short term assets greater than short term liabilities? (1 check)
  2. Are short term assets greater than long term liabilities? (1 check)
  3. Has the debt to equity ratio increased in the past 5 years? (1 check)
  4. Is the debt to equity ratio over 40%? (1 check)
  5. Is the debt covered by operating cash flow? (1 check)
  6. Are earnings greater than 5x the interest on debt (if company pays interest at all)? (1 check)
  7. Arconic has a total score of 2/6, see the detailed checks below.
For companies that are loss making and have been so on average in the past we replace the last 2 checks with:
  1. Does cash and short term investments cover stable operating expenses (recurring G&A and R&D) for more than 3 years? (1 check)
  2. Does cash and short term investments cover growing operating expenses (recurring G&A and R&D) for more than 3 years? (1 check)


Full details on the Health part of the Simply Wall St company analysis model.

ARNC Dividends

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

Dividends are regular cash payments to you from the company, similar to a bank paying you interest on a savings account.
Annual Dividend Income
Dividend payments
0.35%
Current annual income from Arconic dividends. Estimated to be 0.47% next year.
If you bought $2,000 of Arconic shares you are expected to receive $7 in your first year as a dividend.
Dividend Amount
Here we look how much dividend is being paid, if any. Is it above what you can get in a savings account? It is up there with the best dividend paying companies?
  • Arconic's pays a lower dividend yield than the bottom 25% of dividend payers in United States of America (1.46%).
  • Arconic's dividend is below the markets top 25% of dividend payers in United States of America (3.71%).
Annualized Historical and Future Dividends
It is important to see if the dividend for a company is stable, and not wildly increasing/decreasing each year. This graph shows you the historical rate to count toward your assessment of the stock.

We also check to see if the dividend has increased in the past 10 years.
Raw Data
NYSE:ARNC Annualized Past and Future Dividends
Data Point Source Value
Past Annualized Dividend Yield S&P Global Market Data See Below
Past Dividends per Share Company Filings/ Annualized Dividend Payments See Below
Future Dividends per Share Estimates Average of up to 11 Analyst Estimates (S&P Global) See Below
United States of America Aerospace & Defense Industry Average Dividend Yield Market Cap Weighted Average of 22 Stocks 1.9%
United States of America Market Average Dividend Yield Market Cap Weighted Average of 2011 Stocks 2.5%
United States of America Minimum Threshold Dividend Yield 10th Percentile 0.8%
United States of America Bottom 25% Dividend Yield 25th Percentile 1.5%
United States of America Top 25% Dividend Yield 75th Percentile 3.7%

Industry and Market average data is calculated daily.

Note all dividend per share amounts are annualized and not quarterly or other period.

NYSE:ARNC Future Dividends Estimate Data
Date (Data in $) Dividend per Share (annual) Avg. No. Analysts
2023-12-31
2022-12-31
2021-12-31 0.08 3.00
2020-12-31 0.11 8.00
2019-12-31 0.12 8.00
NYSE:ARNC Past Annualized Dividends Data
Date (Data in $) Dividend per share (annual) Avg. Yield (%)
2019-03-11 0.080 0.382
2019-01-29 0.240 1.313
2018-09-27 0.240 1.200
2018-05-17 0.240 1.229
2018-02-15 0.240 1.088
2018-01-19 0.240 0.867
2017-09-19 0.240 0.924
2017-07-24 0.240 0.960
2017-02-23 0.240 0.911
2017-01-13 0.240 0.958

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • Arconic is not paying a notable dividend for United States of America, therefore no need to check if the payments are stable.
  • Arconic is not paying a notable dividend for United States of America, therefore no need to check if the payments are increasing.
Current Payout to shareholders
What portion of Arconic's earnings are paid to the shareholders as a dividend.
  • No need to calculate the sustainability of Arconic's dividends as it is not paying a notable one for United States of America.
Future Payout to shareholders
  • No need to calculate the sustainability of Arconic's dividends in 3 years as they are not expected to pay a notable one for United States of America.
X
Income/ dividend checks
We assess Arconic's dividend by checking for:
  1. Firstly is the company paying a notable dividend (greater than 0.8%) - if not then the rest of the checks are ignored.
  2. Is current dividend yield above the bottom 25% of dividend payers? (1 check)
  3. Is current dividend yield above the top 25% of dividend payers? (1 check)
  4. Have they paid a dividend for 10 years, and during this period has the dividend been volatile (drop of more than 25%)? (1 check)
  5. If they have paid a dividend for 10 years has it increased in this time? (1 check)
  6. How sustainable is the dividend, can Arconic afford to pay it from its earnings today and in 3 years (Payout ratio less than 90%)? (2 checks)
  7. Arconic has a total score of 0/6, see the detailed checks below.


Full details on the Dividends part of the Simply Wall St company analysis model.

ARNC Management

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

Management is one of the most important areas of a company. We look at unreasonable CEO compensation, how long the team and board of directors have been around for and insider trading.
CEO
John Plant
COMPENSATION $402,459
AGE 64
TENURE AS CEO 0.3 years
CEO Bio

Mr. John C. Plant, FCA, has been a Director of Gates Industrial Corporation plc since December 15, 2017 and has served as a director of Gates entities since 2015. Mr. Plant has been Executive Vice President at Northrop Grumman Space & Mission Systems Corporation since 2001 and has been its Member of Chief Executive Officer office since February 2002. Mr. Plant served as the President and Chief Executive Officer of TRW Automotive Inc. at TRW Aeronautical Systems since 2001. Mr. Plant served as the President and Chief Executive Officer at ZF TRW Automotive Holdings Corp. since February 28, 2003 until 2011. Mr. Plant served as the President and Chief Executive Officer of TRW Chassis Systems since 2001. Mr. Plant was President of Lucas Varity Automotive and Managing Director of the Electrical and Electronic division from 1991 to 1997. He was a co-member of the Chief Executive Officer of TRW Inc. from 2001 to 2003 and an Executive Vice President of TRW from 1999 to 2003. Mr. Plant was the Chief Executive Officer and President of TRW Automotive Holdings Corporation (renamed ZF TRW Automotive in 2015), a diverse automotive supplier, from 2011 to 2015. He served as a General Manager of TRW's Automotive Business since 1999. He served as a General Manager of TRW Chassis Systems from 1999 to 2001, President of LucasVarity Automotive from 1998 to 1999 and Managing Director of Electrical and Electronic Division of Lucas Automotive from 1991 to 1998. From 1978 to 1999, Mr. Plant was employed by Lucas Industries in a variety of positions, including certain management positions (last serving as President of Lucas Variety Automotive until its acquisition by TRW). He joined TRW Inc., Aeronautical Unit in 1999. He served as Chairman at TRW Automotive Inc from February 18, 2011 to May 2015. He served as Chairman of ZF TRW Automotive Holdings Corp. since February 16, 2011 until May 15, 2015. He has been a Director at Masco Corporation since May 8, 2012 and Jabil , Inc. since January 21, 2016. He has been a Director at Arconic Inc. (formerly, Alcoa Inc.) since February 5, 2016. Mr. Plant is currently Chairman of the Board of Arconic Inc. Mr. Plant also serves as Chief Executive Officer of Arconic Inc. since February 06, 2019. He serves as a Director of Gates Corporation and Jabil Circuit Corporation. He served as a Director of ZF TRW Automotive Holdings Corp from February 28, 2003 to May 15, 2015. Mr. Plant served as Director of TRW Automotive Inc. He served as a Trustee of Henry Ford Health System, Inc. Mr. Plant has extensive business experience as a public company executive. He served as a Director of Martin Currie Global Portfolio Trust plc (also known as Martin Currie Portfolio Investment Trust PLC) from January 28, 1999 to June 7, 2004. He also serves as Vice Chairman of the Washington based Kennedy Center Corporate Fund Board and a board member of the Automotive Safety Council. From 1974 to 1977, Mr. Plant served as a Chartered Accountant at Touche Ross. Mr. Plant is a Fellow of the Institute of Chartered Accountants. Mr. Plant holds a Bachelor of Commerce Degree in Economics, Accounting and Law and was bestowed an honorary Doctorate from University of Birmingham in 2014.

CEO Compensation
  • John's compensation has increased in line with Arconic recently becoming profitable.
  • John's remuneration is lower than average for companies of similar size in United States of America.
Management Team Tenure

Average tenure and age of the Arconic management team in years:

1.5
Average Tenure
56
Average Age
  • The average tenure for the Arconic management team is less than 2 years, this suggests a new team.
Management Team

John Plant

TITLE
Chairman & CEO
COMPENSATION
$402K
AGE
64
TENURE
0.3 yrs

Elmer Doty

TITLE
President
COMPENSATION
$192K
AGE
64
TENURE
0.3 yrs

Ken Giacobbe

TITLE
Executive VP & CFO
COMPENSATION
$3M
AGE
52
TENURE
2.6 yrs

Kate Ramundo

TITLE
Executive VP
COMPENSATION
$2M
AGE
50
TENURE
2.6 yrs

Tim Myers

TITLE
Executive VP and Group President of Global Rolled Products
COMPENSATION
$3M
AGE
52

PT Luther

TITLE
Director of Investor Relations

Max Laun

TITLE
VP, General Counsel and Chief Ethics & Compliance Officer

George King

TITLE
Head of Corporate Development

Neil Marchuk

TITLE
Executive Vice President of Human Resources
AGE
60
TENURE
0.3 yrs

L. Watts-Stanfield

TITLE
Chief Financial Officer of Transportation & Construction Solutions and Member of Executive Council
TENURE
3.8 yrs
Board of Directors Tenure

Average tenure and age of the Arconic board of directors in years:

3
Average Tenure
65.5
Average Age
  • The average tenure for the Arconic board of directors is less than 3 years, this suggests a new board.
Board of Directors

Elmer Doty

TITLE
President
COMPENSATION
$192K
AGE
64
TENURE
2.1 yrs

Rick Schmidt

TITLE
Independent Director
COMPENSATION
$268K
AGE
68
TENURE
3.3 yrs

John Plant

TITLE
Chairman & CEO
COMPENSATION
$402K
AGE
64
TENURE
1.7 yrs

Sean Mahoney

TITLE
Director
COMPENSATION
$266K
AGE
55
TENURE
3.3 yrs

Raj Gupta

TITLE
Director
COMPENSATION
$240K
AGE
73
TENURE
2.6 yrs

Jim Albaugh

TITLE
Director
COMPENSATION
$198K
AGE
68
TENURE
2.1 yrs

Stan O'Neal

TITLE
Independent Director
COMPENSATION
$251K
AGE
67
TENURE
11.4 yrs

Chris Ayers

TITLE
Director
COMPENSATION
$192K
AGE
51
TENURE
2.1 yrs

Michelle Kiely

TITLE
Member of Community Advisory Board
TENURE
6.1 yrs

Frank Sewell

TITLE
Member of Community Advisory Board
TENURE
6.1 yrs
Who owns this company?
Recent Insider Trading
  • More shares have been bought than sold by Arconic insiders in the past 3 months.
Recent Insider Transactions
Announced Type Name Entity Role Start End Shares Max Price ($) Value ($)
06. May 19 Buy John Plant Individual 02. May 19 02. May 19 50,000 $22.14 $1,106,930
06. May 19 Buy Rajiv Gupta Individual 02. May 19 02. May 19 22,603 $22.10 $499,447
X
Management checks
We assess Arconic's management by checking for:
  1. Is the CEO's compensation unreasonable compared to market cap? (1 check)
  2. Has the CEO's compensation increased more than 20% whilst the EPS is down more then 20%? (1 check)
  3. Is the average tenure of the management team less than 2 years? (1 check)
  4. Is the average tenure of the board of directors team less than 3 years? (1 check)
  5. Arconic has a total score of 0/6, this is not included on the snowflake, see the detailed checks below.


Note: We use the top 6 management executives and board members in our calculations.

Note 2: Insider trading include any internal stakeholders and these transactions .

Full details on the Management part of the Simply Wall St company analysis model.

ARNC News

Simply Wall St News

Does Arconic Inc. (NYSE:ARNC) Create Value For Shareholders?

The formula for ROE is: Return on Equity = Net Profit ÷ Shareholders' Equity Or for Arconic: 13% = US$684m ÷ US$5.2b (Based on the trailing twelve months to March 2019.) Most readers would understand what net profit is, but it’s worth explaining the concept of shareholders’ equity. … The Importance Of Debt To Return On Equity Companies usually need to invest money to grow their profits. … In my book the highest quality companies have high return on equity, despite low debt.

Simply Wall St -

Should You Worry About Arconic Inc.’s (NYSE:ARNC) ROCE?

The formula for calculating the return on capital employed is: Return on Capital Employed = Earnings Before Interest and Tax (EBIT) ÷ (Total Assets - Current Liabilities) Or for Arconic: 0.086 = US$1.3b ÷ (US$18b - US$3.7b) (Based on the trailing twelve months to March 2019.) So, Arconic has an ROCE of 8.6%. … How Arconic's Current Liabilities Impact Its ROCE Short term (or current) liabilities, are things like supplier invoices, overdrafts, or tax bills that need to be paid within 12 months. … Due to the way the ROCE equation works, having large bills due in the near term can make it look as though a company has less capital employed, and thus a higher ROCE than usual.

Simply Wall St -

Arconic (NYSE:ARNC) Shareholders Booked A 17% Gain In The Last Year

One way to examine how market sentiment has changed over time is to look at the interaction between a company's share price and its earnings per share (EPS). … During the last year Arconic grew its earnings per share, moving from a loss to a profit. … When a company is just on the edge of profitability it can be well worth considering other metrics in order to more precisely gauge growth (and therefore understand share price movements).

Simply Wall St -

What Kind Of Shareholders Own Arconic Inc. (NYSE:ARNC)?

The big shareholder groups in Arconic Inc. … Large companies usually have institutions as shareholders, and we usually see insiders owning shares in smaller companies. … Taking a look at our data on the ownership groups (below), it's seems that.

Simply Wall St -

Did Arconic Inc. (NYSE:ARNC) Use Debt To Deliver Its ROE Of 11%?

While some investors are already well versed in financial metrics (hat tip), this article is for those who would like to learn about Return On Equity (ROE) and why it is important. … That means that for every $1 worth of shareholders' equity, it generated $0.11 in profit. … Return on Equity = Net Profit ÷ Shareholders' Equity

Simply Wall St -

Is Arconic Inc. (NYSE:ARNC) Expensive For A Reason? A Look At The Intrinsic Value

by taking the foreast future cash flows of the company and discounting them back to today's value. … Discounted Cash Flows (DCF) … If you want to learn more about discounted cash flow, the basis for my calcs can be read in detail in the Simply Wall St analysis model.

Simply Wall St -

Is Arconic Inc.'s (NYSE:ARNC) Balance Sheet A Threat To Its Future?

Mid-caps stocks, like Arconic Inc. … Surprisingly though, when accounted for risk, mid-caps have delivered better returns compared to the two other categories of stocks. … Don’t forget that this is a general and concentrated examination of Arconic’s financial health, so you should conduct further analysis.

Simply Wall St -

What Kind Of Shareholder Appears On The Arconic Inc.'s (NYSE:ARNC) Shareholder Register?

Insiders often own a large chunk of younger, smaller, companies while huge companies tend to have institutions as shareholders. … We also tend to see lower insider ownership in companies that were previously publicly owned. … Our analysis of the ownership of the company, below, shows that.

Simply Wall St -

Did Arconic Inc (NYSE:ARNC) Insiders Buy Up More Shares?

So we'll take a look at whether insiders have been buying or selling shares in Arconic Inc (NYSE:ARNC). … Over the last year, we can see that the biggest insider purchase was by David Hess for US$1m worth of shares, at about US$24.80 per share. … Happily, we note that in the last year insiders bought 42.30k shares for a total of US$1.0m

Simply Wall St -

Calculating The Intrinsic Value Of Arconic Inc (NYSE:ARNC)

by taking the foreast future cash flows of the company and discounting them back to today's value. … Discounted Cash Flows (DCF). … Anyone interested in learning a bit more about intrinsic value should have a read of the Simply Wall St analysis model

Simply Wall St -

ARNC Company Info

Description

Arconic Inc. engineers, manufactures, and sells lightweight metals worldwide. The company operate in three segments: Engineered Products and Solutions, Global Rolled Products, and Transportation and Construction Solutions. The Engineered Products and Solutions segment produces and sells fastening systems and seamless rolled rings; investment castings, including airfoils and forged jet engine components; and extruded, machined, and formed aircraft parts for aerospace (commercial and defense), industrial, commercial transportation, and power generation end markets. It also offers various forged, extruded, and machined metal products for the oil and gas, automotive, and land and sea defense end markets. The Global Rolled Products segment produces and sells aluminum sheets and plates for the aerospace, automotive, commercial transportation, packaging, building and construction, and industrial products end markets; and aseptic foils for the packaging end market. The Transportation and Construction Solutions segment provides integrated aluminum structural systems, architectural extrusions, and forged aluminum commercial vehicle wheels, which are used primarily in the commercial transportation and nonresidential building and construction end markets. It also produces aluminum products for the industrial products end market. Arconic Inc. sells its products directly to customers, as well as through distributors. The company was founded in 1888 and is based in New York, New York.

Details
Name: Arconic Inc.
ARNC
Exchange: NYSE
Founded: 1888
$10,264,633,304
448,629,078
Website: http://www.arconic.com
Address: Arconic Inc.
390 Park Avenue,
New York,
New York, 10022,
United States
Listings
Exchange Symbol Ticker Symbol Security Exchange Country Currency Listed on
NYSE ARNC Common Stock New York Stock Exchange US USD 31. Oct 2016
DB ALU2 Common Stock Deutsche Boerse AG DE EUR 31. Oct 2016
LSE 0TCU Common Stock London Stock Exchange GB USD 31. Oct 2016
WBAG ARNC Common Stock Wiener Boerse AG AT EUR 31. Oct 2016
SNSE ARNC Common Stock Santiago Stock Exchange CL USD 31. Oct 2016
BMV ARNC * Common Stock Bolsa Mexicana de Valores MX MXN 31. Oct 2016
AMEX ARNC.PR PFD SER A NYSE MKT LLC US USD 01. Nov 2016
BASE ARNC CEDEAR EACH 6 REP 1 COM USD1 Buenos Aires Stock Exchange AR ARS 10. Nov 2016
Number of employees
Current staff
Staff numbers
43,000
Arconic employees.
Industry
Aerospace and Defense
Capital Goods
Company Analysis and Financial Data Status
Area Date (UTC time)
Company Analysis updated: 2019/06/18 00:49
End of day share price update: 2019/06/17 00:00
Last estimates confirmation: 2019/06/14
Last earnings filing: 2019/05/01
Last earnings reported: 2019/03/31
Last annual earnings reported: 2018/12/31


All dates and times in UTC. All financial data provided by Standard & Poor’s Capital IQ.

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.