NYSE:ATI

Stock Analysis Report

Allegheny Technologies

Executive Summary

Allegheny Technologies Incorporated manufactures and sells specialty materials and components worldwide.

Rewards

Trading at 55.4% below its fair value

Earnings grew by 32.4% over the past year

Risk Analysis

Earnings are forecast to decline by an average of -2.9% per year for the next 3 years

Interest payments are not well covered by earnings

Highly volatile share price over past 3 months

Large one-off items impacting financial results

+ 1 more risk


Snowflake Analysis

Undervalued with acceptable track record.


Similar Companies

Reliance Steel & Aluminum

NYSE:RS

Share Price & News

How has Allegheny Technologies's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: ATI's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

1.0%

ATI

-0.02%

US Metals and Mining

1.2%

US Market


1 Year Return

-26.7%

ATI

13.1%

US Metals and Mining

24.2%

US Market

Return vs Industry: ATI underperformed the US Metals and Mining industry which returned 17.5% over the past year.

Return vs Market: ATI underperformed the US Market which returned 24.7% over the past year.


Shareholder returns

ATIIndustryMarket
7 Day1.0%-0.02%1.2%
30 Day-9.2%0.7%3.5%
90 Day-5.5%11.6%11.7%
1 Year-26.7%-26.7%16.5%13.1%26.9%24.2%
3 Year9.9%9.9%2.1%-3.4%53.0%43.2%
5 Year-31.0%-33.9%34.6%24.2%75.3%56.0%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

Is Allegheny Technologies undervalued compared to its fair value and its price relative to the market?

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: ATI ($19.06) is trading below our estimate of fair value ($42.69)

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


Price To Earnings Ratio

PE vs Industry: ATI is good value based on its PE Ratio (9.9x) compared to the Metals and Mining industry average (11.4x).

PE vs Market: ATI is good value based on its PE Ratio (9.9x) compared to the US market (18.9x).


Price to Earnings Growth Ratio

PEG Ratio: ATI's earnings are forecast to decline next year, so we can't calculate its PEG ratio.


Price to Book Ratio

PB vs Industry: ATI is good value based on its PB Ratio (1.1x) compared to the US Metals and Mining industry average (1.6x).


Next Steps

Future Growth

How is Allegheny Technologies forecast to perform in the next 1 to 3 years based on estimates from 11 analysts?

-2.9%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: ATI's earnings are forecast to decline over the next 3 years (-2.9% per year).

Earnings vs Market: ATI's earnings are forecast to decline over the next 3 years (-2.9% per year).

High Growth Earnings: ATI's earnings are forecast to decline over the next 3 years.

Revenue vs Market: ATI's revenue (1.8% per year) is forecast to grow slower than the US market (7.5% per year).

High Growth Revenue: ATI's revenue (1.8% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: ATI's Return on Equity is forecast to be low in 3 years time (8.5%).


Next Steps

Past Performance

How has Allegheny Technologies performed over the past 5 years?

32.9%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: ATI has a large one-off gain of $89.5M impacting its September 30 2019 financial results.

Growing Profit Margin: ATI's current net profit margins (5.8%) are higher than last year (4.7%).


Past Earnings Growth Analysis

Earnings Trend: ATI has become profitable over the past 5 years, growing earnings by 32.9% per year.

Accelerating Growth: ATI's earnings growth over the past year (32.4%) is below its 5-year average (32.9% per year).

Earnings vs Industry: ATI earnings growth over the past year (32.4%) exceeded the Metals and Mining industry -7.6%.


Return on Equity

High ROE: ATI's Return on Equity (11.2%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Allegheny Technologies's financial position?


Financial Position Analysis

Short Term Liabilities: ATI's short term assets ($2.4B) exceed its short term liabilities ($763.3M).

Long Term Liabilities: ATI's short term assets ($2.4B) do not cover its long term liabilities ($2.6B).


Debt to Equity History and Analysis

Debt Level: ATI's debt to equity ratio (67.6%) is considered high.

Reducing Debt: ATI's debt to equity ratio has increased from 51.1% to 67.6% over the past 5 years.

Debt Coverage: ATI's debt is not well covered by operating cash flow (17.3%).

Interest Coverage: ATI's interest payments on its debt are not well covered by EBIT (2.8x coverage).


Balance Sheet

Inventory Level: ATI has a high level of physical assets or inventory.

Debt Coverage by Assets: ATI's debt is covered by short term assets (assets are 1.6x debt).


Next Steps

Dividend

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


Dividend Yield vs Market

company0%marketbottom25%1.4%markettop25%3.7%industryaverage2.5%forecastin3Years0%

Current dividend yield vs market & industry

Notable Dividend: Unable to evaluate ATI's dividend yield against the bottom 25% of dividend payers, as the company has not reported any payouts.

High Dividend: Unable to evaluate ATI's dividend yield against the top 25% of dividend payers, as the company has not reported any payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if ATI's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if ATI's dividend payments have been increasing.


Current Payout to Shareholders

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


Future Payout to Shareholders

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


Next Steps

Management

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

5.5yrs

Average management tenure


CEO

Bob Wetherbee (60yo)

1yrs

Tenure

US$2,469,940

Compensation

Mr. Robert S. Wetherbee, also known as Bob, has been President, Chief Executive Officer and Director at Allegheny Technologies Incorporated since January 1, 2019. Mr. Wetherbee served as an Executive Vice  ...


CEO Compensation Analysis

Compensation vs Market: Bob's total compensation ($USD2.47M) is below average for companies of similar size in the US market ($USD3.86M).

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


Management Age and Tenure

5.5yrs

Average Tenure

58.5yo

Average Age

Experienced Management: ATI's management team is seasoned and experienced (5.5 years average tenure).


Board Age and Tenure

6.1yrs

Average Tenure

67.5yo

Average Age

Experienced Board: ATI's board of directors are considered experienced (6.1 years average tenure).


Insider Trading

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


Recent Insider Transactions

BuyUS$36,34015 Aug 19
Elizabeth Powers
EntityIndividual
Role
Head of Human Resources
Senior VP & Chief Human Resources Officer
Shares2,000
Max PriceUS$18.17
BuyUS$44,20815 Aug 19
Kevin Kramer
EntityIndividual
Role
Head of Marketing
Senior VP and Chief Commercial & Marketing Officer
Shares2,500
Max PriceUS$17.68
BuyUS$51,62015 Aug 19
Timothy Harris
EntityIndividual
Role
Chief Information Officer
Senior VP and Chief Digital & Information Officer
Shares2,900
Max PriceUS$17.80
BuyUS$35,06015 Aug 19
Elliot Davis
EntityIndividual
Role
Chief Legal Officer
Senior VP
Shares2,000
Max PriceUS$17.53
BuyUS$36,36015 Aug 19
Leroy Ball
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares2,000
Max PriceUS$18.18
BuyUS$91,80014 Aug 19
Robert Wetherbee
EntityIndividual
Role
Chief Executive Officer
President
Shares5,000
Max PriceUS$18.36
SellUS$192,06028 Jan 19
Barbara Jeremiah
EntityIndividual
Shares7,500
Max PriceUS$25.61

Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 2%.


Management Team

  • Bob Wetherbee (60yo)

    President

    • Tenure: 1yrs
    • Compensation: US$2.47m
  • Don Newman (54yo)

    SVP of Finance & CFO

    • Beth Powers (59yo)

      Senior VP & Chief Human Resources Officer

      • Tenure: 5.2yrs
    • Elliot Davis (58yo)

      Senior VP

      • Tenure: 9.4yrs
    • John Sims (59yo)

      Executive Vice President of High Performance Material & Components Segment

      • Tenure: 8.7yrs
      • Compensation: US$2.28m
    • Karl Schwartz (56yo)

      VP, Controller & Chief Accounting Officer

      • Tenure: 8.7yrs
    • Kevin Kramer (59yo)

      Senior VP and Chief Commercial & Marketing Officer

      • Tenure: 5.9yrs
      • Compensation: US$2.08m
    • Pat DeCourcy (57yo)

      Senior VP & Special Advisor to the CEO

      • Compensation: US$2.26m
    • Scott Minder

      VP of Investor Relations & Treasurer

      • Tenure: 2.5yrs
    • Timothy Harris

      Senior VP and Chief Digital & Information Officer

      • Tenure: 0.7yrs

    Board Members

    • Jim Rohr (70yo)

      Independent Director

      • Tenure: 24yrs
      • Compensation: US$240.00k
    • Jim Diggs (71yo)

      Independent Director

      • Tenure: 19yrs
      • Compensation: US$235.00k
    • J. Harvey (68yo)

      Independent Director

      • Tenure: 12.1yrs
      • Compensation: US$225.00k
    • Diane Creel (71yo)

      Chairman & Lead Director

      • Tenure: 0.7yrs
      • Compensation: US$265.00k
    • Leroy Ball (50yo)

      Independent Director

      • Tenure: 0.9yrs
    • Bob Wetherbee (60yo)

      President

      • Tenure: 1yrs
      • Compensation: US$2.47m
    • John Pipski (72yo)

      Independent Director

      • Tenure: 8.1yrs
      • Compensation: US$245.00k
    • Carolyn Corvi (67yo)

      Independent Director

      • Tenure: 7.3yrs
      • Compensation: US$225.00k
    • David Morehouse (58yo)

      Independent Director

      • Tenure: 4.9yrs
      • Compensation: US$225.00k
    • Hawk Carlisle (63yo)

      Independent Director

      • Tenure: 1.9yrs

    Company Information

    Allegheny Technologies Incorporated's company bio, employee growth, exchange listings and data sources


    Key Information

    • Name: Allegheny Technologies Incorporated
    • Ticker: ATI
    • Exchange: NYSE
    • Founded: 1960
    • Industry: Steel
    • Sector: Materials
    • Market Cap: US$2.354b
    • Shares outstanding: 126.09m
    • Website: https://www.atimetals.com

    Number of Employees


    Location

    • Allegheny Technologies Incorporated
    • 1000 Six PPG Place
    • Pittsburgh
    • Pennsylvania
    • 15222
    • United States

    Listings

    TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
    ATINYSE (New York Stock Exchange)YesCommon SharesUSUSDMay 1987
    ATDDB (Deutsche Boerse AG)YesCommon SharesDEEURMay 1987

    Biography

    Allegheny Technologies Incorporated manufactures and sells specialty materials and components worldwide. The company operates through two segments, High Performance Materials & Components, and Flat-Rolled Products. The High Performance Materials & Components segment produces high performance materials, including titanium and titanium-based alloys; nickel-and cobalt-based alloys and superalloys; zirconium and related alloys, such as hafnium and niobium; powder alloys; and other specialty materials in long product forms of ingots, billets, bars, rods, wires, and shapes and rectangles, as well as seamless tubes, plus precision forgings, castings, components, and machined parts. This segment serves aerospace and defense, medical, oil and gas, and electrical energy markets. The Flat-Rolled Products segment provides stainless steel, nickel-based alloys, specialty alloys, and titanium and titanium-based alloys in various product forms, including plate, sheet, engineered strip, and Precision Rolled Strip products. This segment serves various markets, such as chemical and hydrocarbon processing, automotive, aerospace and defense, food processing equipment and appliances, construction and mining, electronics, communication equipment, and computers. Allegheny Technologies Incorporated was founded in 1960 and is based in Pittsburgh, Pennsylvania. 


    Company Analysis and Financial Data Status

    All financial data provided by Standard & Poor's Capital IQ.
    DataLast Updated (UTC time)
    Company Analysis2020/01/20 23:31
    End of Day Share Price2020/01/17 00:00
    Earnings2019/09/30
    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.