Advanced Drainage Systems (NYSE:WMS) - Share price, News & Analysis

WMS fundamental analysis
Snowflake Score
Valuation	2/6
Future Growth	5/6
Past Performance	3/6
Financial Health	3/6
Dividends	0/6

WMS Stock Overview

Rewards

Trading at 26.2% below our estimate of its fair value

Earnings are forecast to grow 24.01% per year

Earnings have grown 28.7% per year over the past 5 years

Risk Analysis

Has a high level of debt

Shareholders have been diluted in the past year

Advanced Drainage Systems Competitors

Kimberly-Clark

NYSE:KMB

US$43.2b

Myriad Genetics

NasdaqGS:MYGN

US$1.8b

Paul Hartmann

DB:PHH2

€1.1b

Price History & Performance

Summary of all time highs, changes and price drops for Advanced Drainage Systems
Historical stock prices
Current Share Price	US$104.91
52 Week High	US$138.02
52 Week Low	US$92.28
Beta	1.39
1 Month Change	-3.66%
3 Month Change	-10.00%
1 Year Change	-6.41%
3 Year Change	250.17%
5 Year Change	408.04%
Change since IPO	555.69%

Recent News & Updates

May 20

Here's Why I Think Advanced Drainage Systems (NYSE:WMS) Might Deserve Your Attention Today

For beginners, it can seem like a good idea (and an exciting prospect) to buy a company that tells a good story to...

May 15

Advanced Drainage Systems: Pullback In Stock Occurred, 48% Upside Possible

Advanced Drainage Systems is poised for strong growth as its solutions are needed for all phases of storm water management. The recent sell-off improved the valuation, leaving plenty of upside for the stock. The technical perspective is indicating a bullish turnaround for the stock.

May 08

Advanced Drainage Systems, Inc. (NYSE:WMS) Shares Could Be 39% Below Their Intrinsic Value Estimate

In this article we are going to estimate the intrinsic value of Advanced Drainage Systems, Inc. ( NYSE:WMS ) by taking...

Shareholder Returns

	WMS	US Building	US Market
7D	3.6%	-3.1%	-2.7%
1Y	-6.4%	-19.8%	-12.9%

Return vs Industry: WMS exceeded the US Building industry which returned -19.8% over the past year.

Return vs Market: WMS exceeded the US Market which returned -12.9% over the past year.

Price Volatility

Is WMS's price volatile compared to industry and market?
WMS volatility
WMS Average Weekly Movement	7.0%
Building Industry Average Movement	6.3%
Market Average Movement	7.8%
10% most volatile stocks in US Market	16.8%
10% least volatile stocks in US Market	2.9%

Stable Share Price: WMS is not significantly more volatile than the rest of US stocks over the past 3 months, typically moving +/- 7% a week.

Volatility Over Time: WMS's weekly volatility (7%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
1966	5,635	Donald Barbour	https://www.adspipe.com

Advanced Drainage Systems, Inc. designs, manufactures, and markets thermoplastic corrugated pipes and related water management products, and drainage solutions for use in the underground construction and infrastructure marketplace in the United States, Canada, Mexico, and internationally. The company operates through Pipe, International, Infiltrator, and Allied Products & Other segments. It offers single, double, and triple wall corrugated polypropylene and polyethylene pipes; plastic leachfield chambers and systems, EZflow synthetic aggregate bundles, mechanical aeration wastewater solutions, septic tanks and accessories, and combined treatment and dispersal systems; and allied products, including storm retention/detention and septic chambers, polyvinyl chloride drainage structures, fittings, and water quality filters and separators.

Advanced Drainage Systems Fundamentals Summary

How do Advanced Drainage Systems's earnings and revenue compare to its market cap?
WMS fundamental statistics
Market Cap	US$8.85b
Earnings (TTM)	US$229.53m
Revenue (TTM)	US$2.77b

38.6x

P/E Ratio

3.2x

P/S Ratio

Is WMS overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
WMS income statement (TTM)
Revenue	US$2.77b
Cost of Revenue	US$1.95b
Gross Profit	US$819.57m
Other Expenses	US$590.03m
Earnings	US$229.53m

Last Reported Earnings

Mar 31, 2022

Next Earnings Date

n/a

Earnings per share (EPS)	2.72
Gross Margin	29.59%
Net Profit Margin	8.29%
Debt/Equity Ratio	84.0%

How did WMS perform over the long term?

See historical performance and comparison

Dividends

0.5%

Current Dividend Yield

14%

Payout Ratio

Does WMS pay a reliable dividends?

See WMS dividend history and benchmarks

When do you need to buy WMS by to receive an upcoming dividend?
Advanced Drainage Systems dividend dates
Ex Dividend Date	May 31 2022
Dividend Pay Date	Jun 15 2022
Days until Ex dividend	8 days
Days until Dividend pay date	23 days

Does WMS pay a reliable dividends?

See WMS dividend history and benchmarks

Valuation

Is Advanced Drainage Systems undervalued compared to its fair value and its price relative to the market?

Valuation Score

2/6

Valuation Score 2/6

Below Fair Value
Significantly Below Fair Value
PE vs Industry
PE vs Market
PEG Ratio
PB vs Industry

26.2%

Undervalued compared to fair value

Share Price vs. Fair Value

Below Fair Value: WMS ($104.91) is trading below our estimate of fair value ($142.22)

Significantly Below Fair Value: WMS is trading below fair value by more than 20%.

Price To Earnings Ratio

PE vs Industry: WMS is poor value based on its PE Ratio (38.6x) compared to the US Building industry average (16.3x).

PE vs Market: WMS is poor value based on its PE Ratio (38.6x) compared to the US market (15.3x).

Price to Earnings Growth Ratio

PEG Ratio: WMS is poor value based on its PEG Ratio (1.6x)

Price to Book Ratio

PB vs Industry: WMS is overvalued based on its PB Ratio (9.9x) compared to the US Building industry average (2.1x).

Future Growth

How is Advanced Drainage Systems forecast to perform in the next 1 to 3 years based on estimates from 4 analysts?

Future Growth Score

5/6

Future Growth Score 5/6

Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Future ROE

24.0%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: WMS's forecast earnings growth (24% per year) is above the savings rate (1.9%).

Earnings vs Market: WMS's earnings (24% per year) are forecast to grow faster than the US market (12.5% per year).

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

Revenue vs Market: WMS's revenue (8% per year) is forecast to grow faster than the US market (7.8% per year).

High Growth Revenue: WMS's revenue (8% per year) is forecast to grow slower than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: WMS's Return on Equity is forecast to be very high in 3 years time (46.5%).

Past Performance

How has Advanced Drainage Systems performed over the past 5 years?

Past Performance Score

3/6

Past Performance Score 3/6

Quality Earnings
Growing Profit Margin
Earnings Trend
Accelerating Growth
Earnings vs Industry
High ROE

28.7%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: WMS has high quality earnings.

Growing Profit Margin: WMS's current net profit margins (8.3%) are lower than last year (9.3%).

Past Earnings Growth Analysis

Earnings Trend: WMS's earnings have grown significantly by 28.7% per year over the past 5 years.

Accelerating Growth: WMS's earnings growth over the past year (23.8%) is below its 5-year average (28.7% per year).

Earnings vs Industry: WMS earnings growth over the past year (23.8%) underperformed the Building industry 27.3%.

Return on Equity

High ROE: WMS's Return on Equity (24.9%) is considered high.

Financial Health

How is Advanced Drainage Systems's financial position?

Financial Health Score

3/6

Financial Health Score 3/6

Short Term Liabilities
Long Term Liabilities
Debt Level
Reducing Debt
Debt Coverage
Interest Coverage

Financial Position Analysis

Short Term Liabilities: WMS's short term assets ($871.9M) exceed its short term liabilities ($391.2M).

Long Term Liabilities: WMS's short term assets ($871.9M) do not cover its long term liabilities ($1.2B).

Debt to Equity History and Analysis

Debt Level: WMS's net debt to equity ratio (82.2%) is considered high.

Reducing Debt: WMS's debt to equity ratio has increased from 63.6% to 84% over the past 5 years.

Debt Coverage: WMS's debt is well covered by operating cash flow (29.6%).

Interest Coverage: WMS's interest payments on its debt are well covered by EBIT (13.4x coverage).

Balance Sheet

Dividend

What is Advanced Drainage Systems's current dividend yield, its reliability and sustainability?

Dividend Score

0/6

Dividend Score 0/6

Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Future Dividend Coverage

0.46%

Current Dividend Yield

Upcoming Dividend Payment

Dividend Yield vs Market

Notable Dividend: WMS's dividend (0.46%) isn’t notable compared to the bottom 25% of dividend payers in the US market (1.58%).

High Dividend: WMS's dividend (0.46%) is low compared to the top 25% of dividend payers in the US market (4.11%).

Stability and Growth of Payments

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

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

Earnings Payout to Shareholders

Earnings Coverage: WMS is not paying a notable dividend for the US market.

Cash Payout to Shareholders

Cash Flow Coverage: WMS is not paying a notable dividend for the US market.

Discover strong dividend paying companies

Management

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

3.6yrs

Average management tenure

CEO

Donald Barbour (58 yo)

4.67yrs

Tenure

US$6,078,864

Compensation

Mr. Donald Scott Barbour has been Chief Executive Officer and President of Advanced Drainage Systems, Inc. since September 1, 2017. He serves as Independent Director at Allison Transmission Holdings, Inc....

CEO Compensation Analysis

Compensation vs Market: Donald's total compensation ($USD6.08M) is about average for companies of similar size in the US market ($USD8.23M).

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

Leadership Team

Experienced Management: WMS's management team is considered experienced (3.6 years average tenure).

Board Members

Experienced Board: WMS's board of directors are considered experienced (5.2 years average tenure).

Ownership

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

Insider Trading Volume

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

Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 18.7%.

Data	Last Updated (UTC time)
Company Analysis	2022/05/21 00:00
End of Day Share Price	2022/05/20 00:00
Earnings	2022/03/31
Annual Earnings	2022/03/31