Armstrong World Industries Inc

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AWI : NYSE : Industrial Goods
$43.98 -0.16 | -0.36%
Today's Range: 43.65 - 44.84
Avg. Daily Volume: 566,700
08/26/16 - 4:02 PM ET

Financial Analysis


ARMSTRONG WORLD INDUSTRIES's gross profit margin for the second quarter of its fiscal year 2016 has decreased when compared to the same period a year ago. Even though sales increased, the net income has decreased, representing a decrease to the bottom line. ARMSTRONG WORLD INDUSTRIES has average liquidity. Currently, the Quick Ratio is 1.04 which shows that technically this company has the ability to cover short-term cash needs. The company's liquidity has decreased from the same period last year, indicating deteriorating cash flow.

At the same time, stockholders' equity ("net worth") has significantly decreased by 72.91% from the same quarter last year. Together, the key liquidity measurements indicate that it is relatively unlikely that the company will face financial difficulties in the near future.

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Income Statement Q2 FY16 Q2 FY15
Net Sales ($mil)314.3306.1
EBITDA ($mil)55.756.8
EBIT ($mil)35.727.9
Net Income ($mil)16.929.6


Balance Sheet Q2 FY16 Q2 FY15
Cash & Equiv. ($mil)99.4201.6
Total Assets ($mil)1697.02657.9
Total Debt ($mil)873.81024.6
Equity ($mil)202.4747.3


Profitability Q2 FY16 Q2 FY15
Gross Profit Margin35.4839.33
EBITDA Margin17.7218.55
Operating Margin11.369.11
Sales Turnover1.080.7
Return on Assets1.473.92
Return on Equity14.0310.45
Debt Q2 FY16 Q2 FY15
Current Ratio1.752.09
Debt/Capital0.810.58
Interest Expense12.511.4
Interest Coverage2.862.45


Share Data Q2 FY16 Q2 FY15
Shares outstanding (mil)55.4955.3
Div / share0.00.0
EPS0.290.27
Book value / share3.6513.51
Institutional Own % n/a n/a
Avg Daily Volume603855.0682368.0

Valuation


HOLD. ARMSTRONG WORLD INDUSTRIES's P/E ratio indicates a significant premium compared to an average of 32.43 for the Building Products industry and a significant premium compared to the S&P 500 average of 25.30. To use another comparison, its price-to-book ratio of 12.10 indicates a significant premium versus the S&P 500 average of 2.83 and a significant discount versus the industry average of 31.47. The price-to-sales ratio is well below both the S&P 500 average and the industry average, indicating a discount.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
AWI 86.53 Peers 32.43   AWI 27.31 Peers 15.87

Premium. A higher P/E ratio than its peers can signify a more expensive stock or higher growth expectations.

AWI is trading at a significant premium to its peers.

 

Premium. 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.

AWI is trading at a significant premium to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
AWI 17.62 Peers 21.67   AWI 0.60 Peers 0.75

Discount. A lower price-to-projected earnings ratio than its peers can signify a less expensive stock or lower future growth expectations.

AWI is trading at a discount to its peers.

 

Discount. 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.

AWI trades at a discount to its peers.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
AWI 12.10 Peers 31.47   AWI -63.58 Peers 180.89

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.

AWI 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, AWI 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
AWI 1.33 Peers 1.83   AWI -1.44 Peers 12.20

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.

AWI 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.

AWI significantly trails its peers on the basis of sales growth

 

 

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