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ABCO : NASDAQ : Services
$51.1 up 2.0 | 4.07%
Today's Range: 49.25 - 51.675
Avg. Daily Volume: 585900.0
04/28/17 - 4:00 PM ET

Financial Analysis


ADVISORY BOARD CO's gross profit margin for the fourth quarter of its fiscal year 2016 has increased when compared to the same period a year ago. Even though sales decreased, the net income has increased, representing an increase to the bottom line. ADVISORY BOARD CO has weak liquidity. Currently, the Quick Ratio is 0.99 which shows a lack of ability to cover short-term cash needs. The company's liquidity has increased from the same period last year, indicating improving cash flow.

During the same period, stockholders' equity ("net worth") has increased by 15.13% 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 Q4 FY16 Q4 FY15
Net Sales ($mil)203.85204.95
EBITDA ($mil)44.7336.61
EBIT ($mil)25.3217.76
Net Income ($mil)35.87-105.28


Balance Sheet Q4 FY16 Q4 FY15
Cash & Equiv. ($mil)91.1571.83
Total Assets ($mil)2036.881979.87
Total Debt ($mil)585.45552.92
Equity ($mil)517.04449.09


Profitability Q4 FY16 Q4 FY15
Gross Profit Margin52.6449.84
EBITDA Margin21.9417.86
Operating Margin12.428.66
Sales Turnover0.390.39
Return on Assets4.47-6.01
Return on Equity17.64-26.5
Debt Q4 FY16 Q4 FY15
Current Ratio1.010.96
Debt/Capital0.530.55
Interest Expense4.44.91
Interest Coverage5.763.62


Share Data Q4 FY16 Q4 FY15
Shares outstanding (mil)40.1941.57
Div / share0.00.0
EPS0.88-2.51
Book value / share12.8610.8
Institutional Own % n/a n/a
Avg Daily Volume641423.0615808.0

Valuation


BUY. The current P/E ratio indicates a significant discount compared to an average of 38.64 for the Professional Services industry and a discount compared to the S&P 500 average of 24.92. Conducting a second comparison, its price-to-book ratio of 3.69 indicates a premium versus the S&P 500 average of 2.99 and a significant discount versus the industry average of 7.97. The price-to-sales ratio is above the S&P 500 average, but well below the industry average. Upon assessment of 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 21.21 Peers 38.64   ABCO 16.96 Peers 18.60

Discount. A lower P/E ratio than its peers can signify a less expensive stock or lower growth expectations.

ABCO is trading at a significant discount to its peers.

 

Average. 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 valuation on par 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 22.14 Peers 19.88   ABCO NM Peers 1.69

Premium. A higher price-to-projected earnings ratio than its peers can signify a more expensive stock or higher future growth expectations.

ABCO is trading at a premium to 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.

ABCO's negative PEG ratio makes this valuation measure meaningless.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
ABCO 3.69 Peers 7.97   ABCO 178.59 Peers 34.06

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.

 

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

ABCO is expected to have an earnings growth rate that significantly exceeds its peers.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
ABCO 2.38 Peers 3.91   ABCO 4.56 Peers 13.79

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.

 

Lower. A sales growth rate that trails the industry implies that a company is losing market share.

ABCO significantly trails its peers on the basis of sales growth

 

 

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