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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
Ametek, Inc. (XNYS:AME) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
AME
Name:
AMETEK, INC. (XNYS:AME)
Sector:
174.95M
Industry:
Specialty Industrial Machinery
CEO:
Mr. David Zapico
Total Employees:
18,500
Our Technological Advancement Rating
Our Rating:
B
Technological advancement compared to industry is 13.13% higher
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF AMETEK, INC.(AME) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND SPECIALTY INDUSTRIAL MACHINERY INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
117.83
One Month Price Target:
$118.66
Six Month Price Target :
$122.81
Likely Price in One Year's Time:
Ticker:
$127.79
Likely Trading Range Today Under (Normal Volatility)
$117.48
Price Upper limit ($) :
$118.3
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$112.93
This week:
$106.87
This month :
$95.9
Other Primary facts
Market Cap:
27.44B
Market Cap Classification:
Large Cap
Number of Shares
IPO Date:
229.58M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
16.72%
-16.17%
Worst Daily Decline:
Our Options Trading Entry Points
Iron Condor entry points for options expiring in 1 week's time
Low risk (<2%) entry points
Buy Call:
Sell Call:
Buy Put:
Sell Put:
$140.58
$130.11
$95.08
$105.55
Medium risk (<10%) entry points
Buy Call
Sell Call
$126.71
Buy Put:
Sell Put:
$124.47
$108.93
$111.19
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
AME
Sharpe Ratio:
1.86%
Comparison:
AME, is amongst the top 40% stocks with highest risk-adjusted returns
Sharpe ratio is -1.59% lower than the industry
& is -18.20% lower than the market/S&P 500 average
Average Returns/Yield of
AME
Daily returns:
0.05%
Weekly returns:
0.24%
Monthly returns:
0.94%
Yearly returns:
16.25%
Comparison of returns:
Average annual returns/yield (last 3 years) is -30.50% below industry average
Classification:
AME, is amongst the top 60% highest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.78
Statistical test of Returns:
AME has not yielded statistically significant higher returns when compared to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
2.05%
Weekly Volatility:
4.58%
Monthly Volatility:
9.16%
Yearly Volatility:
31.75%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
1.09%
Volatility in last five trading days has been -46.83% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-4.16%
Weekly VaR:
-9.31%
Monthly VaR:
-18.61%
How Much Can the price of
AME
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-16%
Worst case (decline):
-64.47%
This translates to price declining to:
$99.07
This translates to price declining to:
$41.87
Severe Crash Probability
Risk of crash in next 6/12 months: Medium (<50%)
What is Value at Risk (VaR)?
Risk Fundamentals
AME is a 31.35% riskier investment compared to the market/S&P 500 & is 12.53% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is -25.10% below industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
AME
Beta in relation to market/S&P 500--1.26
Expected beta in 1 year's time:
0.857
Expected beta in 3 year's time:
1.212
Unlevered (debt free) Beta:
1
Beta in relation to Nasdaq (XNAS):
0.802
Beta in relation to all global stocks::
0.861
Beta Comparison & Analysis
Beta of competitors/peers::
1.138
Beta is 10.50% higher than peers
Average Industry Beta:
1.281
Beta is -1.83% below industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
16.93%
Sustainable growth rate is 13.72% above industry average
Alpha provided | Alpha Analysis
Alpha provided:
-0.005
Alpha is -110.97% below industry average alpha yield
Alpha is -30% below the market average
Analysis of Cost of Capital of
AME
Equity cost of capital:
0.118
Equity cost of capital is -1.35% below industry mean WACC
Unlevered (without debt) cost of capital:
9.36%
Before-tax cost of debt:
3.19%
After-tax cost of debt:
2.52%
Overall debt rating:
High AA grade (second highest grade)
Weighted average cost of capital (WACC):
2.52%
WACC is -74.66% below industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$25.22
Revenue growth rate per share of (3Y):
3.9
Annual revenue growth rate is -25.91% below industry average
EPS:
$4.48
Expected Annual growth rate of EPS (3Y):
3.98%
Expected future EPS growth rate is 30.63% higher than the Specialty Industrial Machinery industry
Free cash flow (FCF) per share:
$4.08
Balance sheet equity growth per share: 44.06%
Equity growth rate per share is 308.20% higher than the industry
Debt per share
$9.60
EBITDA per share
$7.29
Valuation Analysis Today of
AME
P/E Ratio:
25.05
P/E Ratio of Competitors/Peers:
30.91
P/E ratio is -18.96% lower than main peers & is -8.95% lower than the industry
Stock price/value with industry average P/E ratio: $123.26
AME is -4.41% undervalued if valued using industry average P/E ratio
Share value as per dividend discount (DDM) model: $30.47
Present value of the expected future dividends only: $12.97
P/S (Price to Sales ratio):
4.67
Price to sales ratio is 12.61% above the industry mean
P/B (Price to book value ratio):
3.9
Price to free cash flow: 28.88
Price to free cash flow ratio is 4.28% higher than the industry
Net income growth rate (3Y):
28.04%
Net income growth rate is 1982.97% higher than the average industry net income growth rate
Dividend Analysis
Dividend payout rate: 4.87%
Dividend yeild: 0.71%
Previous Dividend: $0.22
Previous adjusted dividend: $0.22
Previous Dividend: $0.84
Expected next dividend best case: $0.24
Expected next dividend worst case: $0.20
Average dividend payment (long-term): $0.19
Average dividend increase/decrease (growth rate) % per period: 4.97%
Expected next dividend payment date: 28/09/2022
Expected next dividend record date: 09/08/2022
-
Previous dividend payment date: 30/06/2022
Previous dividend record date: 06/10/2022
-
Dividend History:
2022-06-09--$0.22
2021-12-07--$0.20
2021-06-11--$0.20
2022-03-09--$0.22
2021-09-13--$0.20
2021-03-12--$0.20
Dividend growth rate is 42.53% higher than the average industry
In-depth Debt & Leverage Analysis
Debt to equity ratio:
31.80%
Net debt to equity ratio:
31.68%
Debt to assets ratio:
18.41%
Net debt to assets ratio:
18.34%
Debt-to-asset ratio is -65.87% below industry average
Ability to repay debt:
Interest coverage ratio:
20.66
Interest coverage ratio is 5.86% more than industry average
Looking forward:
Debt growth rate:
5.41%
Annual debt growth is -93% lower than industry average debt growth rate
Debt repayment rate in last quarter: 0.00%
Analysis of Key Statistics
Correlation of price movement with the market:
0.842
Statistical significance of correlation:
AME has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.635
Stock price is 32.51% more correlated with the market, compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.635
Correlation of price movement with Nasdaq (^IXIC):
0.012
Covariance of price movement with the market:
0.014
Kurtosis
18.071
Returns have severe fat-tails (leptokurtic), i.e., returns considerably higher or lower than the mean returns are considerably more likely, compared to assets with normally distributed returns
Skewness of returns:
-0.609
Returns are left (negative) skewed; mean returns are lower than median and mode returns
Fundamental Analysis & Dupont Analysis of
AME
Gross Profit Margin Ratio:
138%
Operating Profit Margin Ratio:
23.64%
Operating profit margin is -197.62% lower than the industry
Net Profit Margin Ratio:
138%
Effective Tax Rate:
18.93%
Effective tax rate is 1.33% higher than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
15.05%
Return on equity (ROE) is 347.93% higher than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
8.71%
Return on assets (ROA) is 85.68% higher than the industry
Financial Leverage:
1.2x
Current Ratio:
1.43
Current ratio is -52.70% below industry average
Cash Conversion Cycle (days):
26.4
Cash conversion cycle is -57.14% below industry average
The remaining useful life of property plant & equipment is: 4.8 years
Stock based compensation to net income ratio:
0.92%
In-depth Efficiency Analysis
Revenue generated per employee:
312.9K
Each employee generates -92% less revenue than industry average revenue per employee
EBITDA generated per employee:
90.5K
Each employee generates -88% less EBITDA than industry average revenue per employee
Profit generated per employee:
56.4K
Each employee generates -86% less net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
9.5K
Each employee generates -82% less free cash flow than industry average revenue per employee
Assets/Capital per employee
524.3K
Each employee generates -82% less free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
-
-
Competitors/Peer firms of
AME
EQUIFAX INC. (XNYS:EFX)
CUMMINS INC. (XNYS:CMI)
WASTE CONNECTIONS, INC. (XNYS:WCN)
OTIS WORLDWIDE CORPORATION (XNYS:OTIS)
TRANSDIGM GROUP INCORPORATED (XNYS:TDG)
ROCKWELL AUTOMATION, INC. (XNYS:ROK)
FERGUSON PLC (XNYS:FERG)
SOUTHWEST AIRLINES CO. (XNYS:LUV)
KANSAS CITY SOUTHERN (XMEX:KSU*)
Current Analyst Ratings
Strong buy�25%
Buy�29%
Hold�4%
Sell�0%
Strong sell�0%
Overall analyst sentiment is: Buy
Income Statement
Period:
TTM
Date:
3/31/22
Revenue:
5.79B
Cost of Revenue:
Gross Profit:
R&D Expense
General & Admin Expenses:
Selling, General & Admin Expenses
Sales and Marketing Expenses
Other Expenses :
Operating Expenses :
Cost & Expenses :
Interest Income:
Interest Expenses:
Depreciation & Amortization:
EBITDA:
Operating Income:
Other Income Expenses:
Income Before Tax:
Income Tax Expense:
Net Income:
Balance Sheet
Date:
Calendar Year:
Period:
Cash & Cash Equivalents:
Short Term Investments:
Cash & Short Term Investments:
Net Receivables:
Inventory:
Other Current Assets:
Total Current Assets:
PP&E:
Goodwill:
Intangible Assets:
Long Term Investments:
Tax Assets:
Other Non-Current Assets:
Total Non-Current Assets:
Other Assets:
Total Assets:
Accounts Payable:
Short Term Debt:
Tax Payables:
Deferred Revenue:
Other Current Liabilities:
Total Current Liabilities:
Long Term Debt:
Other Non-Current Liabilities:
Total Non Current Liabilities:
Other Liabilities:
Total Liabilities:
Common Stock:
Retained Earnings:
Accumulated Other Comprehensive Loss:
Other Total Stockholders' Equity:
Total Stockholders' Equity:
Total Liabilities and Stockholders' Equity:
Total Investments:
Total Debt:
Net Debt:
3.79B
2.00B
-
-
627.39M
-
-
627.39M
-
81.00M
305.62M
1.67B
1.37B
1.04B
1.29B
243.67M
1.04B
Statement of Cash Flow
Date:
Period:
78.12M
Differed Income Tax :
- 497.00K
Stock Based Compensation :
9.57M
Change in Working Capital :
- 138897.00K
Accounts Receivables:
-
Other Working Capital:
-
Other Non-Cash Items:
- 19404.00K
Net Cash Provided by Operating Activities:
201.34M
Investments in PP&E:
- 26389.00K
Net Acquisitions:
-
Purchases of Investments:
-
Sales/Maturities of Investments:
Other Investing Activities:
Net Cash Used for Investing Activities:
Debt Repayment:
Common Stock Issued:
Common Stock Repurchased:
Dividend Paid:
Other Financing Activities:
Net Cash Used Provided by Financing Activities:
Effect of FOREX on Changes in Cash:
Net Changes in Cash:
Cash at End of Period:
Cash at Beginning of Period:
Operating Cash Flow:
Capital Expenditure:
Free Cash Flow (FCF):
3/31/22
2022
Q1
340.30M
-
340.30M
854.46M
866.47M
211.58M
2.27B
780.29M
5.22B
3.31B
387.62M
-
-
9.70B
-
11.97B
504.25M
331.43M
74.06M
322.89M
432.17M
1.59B
2.20B
529.37M
3.45B
-
5.04B
2.69M
8.12B
- 485590.0K
-
March 31, 2022 at 6:00:00 AM
4.42B
6.93B
11.97B
-
2.54B
2.2B
-
11.51M
- 14881.00K
-
-
- 156724.00K
- 50778.00K
20.06M
- 187443.00K
- 5485.00K
- 6468.00K
340.30M
346.77M
201.34M
- 26389.00K
174.95M
Our Proprietary Portfolio Rating
Our Rating:
B
Price Forecast/Expected Price in Next 5 Years of
AME
2023
2024
2025
2026
2027
$145.05
$157.31
$170.61
$185.03
$200.67