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ABCO : NASDAQ : Services
$41.46 | %
Today's Range: 0.00 - 0.00
Avg. Daily Volume: 387,300
07/28/16 - 4:00 PM ET

Financial Analysis


ADVISORY BOARD CO's gross profit margin for the first quarter of its fiscal year 2016 has increased when compared to the same period a year ago. Sales and net income have grown, and although the growth in revenues has outpaced the average competitor within the industry, the net income growth has not. ADVISORY BOARD CO has weak liquidity. Currently, the Quick Ratio is 0.90 which shows a lack of ability to cover short-term cash needs. The liquidity decreased from the same period a year ago, despite already having weak liquidity to begin with. This would indicate deteriorating cash flow.

During the same period, stockholders' equity ("net worth") has decreased by 23.37% from the same quarter last year. Overall, the key liquidity measurements indicate that the company is in a position in which financial difficulties could develop in the future.

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Income Statement Q1 FY16 Q1 FY15
Net Sales ($mil)200.74179.32
EBITDA ($mil)39.4927.43
EBIT ($mil)20.7310.15
Net Income ($mil)10.34-22.07


Balance Sheet Q1 FY16 Q1 FY15
Cash & Equiv. ($mil)52.4477.86
Total Assets ($mil)1896.632069.57
Total Debt ($mil)550.5571.24
Equity ($mil)440.54574.89


Profitability Q1 FY16 Q1 FY15
Gross Profit Margin51.6746.94
EBITDA Margin19.6715.29
Operating Margin10.335.66
Sales Turnover0.420.3
Return on Assets-4.56-1.14
Return on Equity-19.65-4.13
Debt Q1 FY16 Q1 FY15
Current Ratio0.930.99
Debt/Capital0.560.5
Interest Expense4.825.61
Interest Coverage4.31.81


Share Data Q1 FY16 Q1 FY15
Shares outstanding (mil)40.8842.24
Div / share0.00.0
EPS0.25-0.54
Book value / share10.7813.61
Institutional Own % n/a n/a
Avg Daily Volume393307.0646758.0

Valuation


HOLD. The current P/E ratio is negative, which has no meaningful value in the assessment of premium or discount valuation, it simply displays that the company has negative earnings. Conducting a second comparison, its price-to-book ratio of 3.54 indicates a premium versus the S&P 500 average of 2.81 and a significant discount versus the industry average of 6.18. The price-to-sales ratio is similar to the S&P 500 average, but it is significantly below the industry average, indicating a discount. After reviewing these and other key valuation criteria, ADVISORY BOARD CO proves to trade at a discount to investment alternatives within the industry.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
ABCO NM Peers 44.35   ABCO 10.76 Peers 23.52

Neutral. The absence of a valid P/E ratio happens when a stock can not be valued on the basis of a negative stream of earnings.

ABCO's P/E is negative making this valuation measure meaningless.

 

Discount. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.

ABCO is trading at a significant discount to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
ABCO 20.09 Peers 21.00   ABCO NA Peers 2.87

Average. An average price-to-projected earnings ratio can signify an industry neutral stock price and average future growth expectations.

ABCO is trading at a valuation on par with its peers.

 

Neutral. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.

Ratio not available.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
ABCO 3.54 Peers 6.18   ABCO -249.15 Peers 17.64

Discount. A lower price-to-book ratio makes a stock more attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

ABCO is trading at a significant discount to its peers.

 

Lower. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

However, ABCO is expected to significantly trail its peers on the basis of its earnings growth rate.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
ABCO 1.97 Peers 3.53   ABCO 28.30 Peers 13.27

Discount. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.

ABCO is trading at a significant discount to its industry on this measurement.

 

Higher. A sales growth rate that exceeds the industry implies that a company is gaining market share.

ABCO has a sales growth rate that significantly exceeds its peers.

 

 

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