Advanced Drainage Systems Inc.
Find Ratings ReportsADVANCED DRAINAGE SYSTEMS's gross profit margin for the third quarter of its fiscal year 2023 has increased when compared to the same period a year ago. The company managed to grow both sales and net income at a faster pace than the average competitor in its subsector this quarter as compared to the same quarter a year ago. ADVANCED DRAINAGE SYSTEMS has strong liquidity. Currently, the Quick Ratio is 1.96 which shows the ability to cover short-term cash needs. The company managed to increase its liquidity from the same period a year ago, despite already having strong liquidity to begin with. This would indicate improved cash flow.
During the same period, stockholders' equity ("net worth") has increased by 9.29% from the same quarter last year. The key liquidity measurements indicate that the company is unlikely to face financial difficulties in the near future.
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Income Statement | Q3 FY23 | Q3 FY22 |
---|---|---|
Net Sales ($mil) | 662.37 | 655.17 |
EBITDA ($mil) | 194.86 | 161.32 |
EBIT ($mil) | 156.81 | 125.47 |
Net Income ($mil) | 105.64 | 82.04 |
Balance Sheet | Q3 FY23 | Q3 FY22 |
---|---|---|
Cash & Equiv. ($mil) | 560.74 | 426.69 |
Total Assets ($mil) | 3161.96 | 3005.66 |
Total Debt ($mil) | 1324.81 | 1308.77 |
Equity ($mil) | 1200.25 | 1098.13 |
Profitability | Q3 FY23 | Q3 FY22 |
---|---|---|
Gross Profit Margin | 43.05 | 37.54 |
EBITDA Margin | 29.41 | 24.62 |
Operating Margin | 23.67 | 19.15 |
Sales Turnover | 0.9 | 1.04 |
Return on Assets | 15.84 | 15.55 |
Return on Equity | 41.74 | 42.45 |
Debt | Q3 FY23 | Q3 FY22 |
---|---|---|
Current Ratio | 3.03 | 3.13 |
Debt/Capital | 0.52 | 0.54 |
Interest Expense | 22.33 | 20.0 |
Interest Coverage | 7.02 | 6.27 |
Share Data | Q3 FY23 | Q3 FY22 |
---|---|---|
Shares outstanding (mil) | 70.2 | 71.55 |
Div / share | 0.14 | 0.12 |
EPS | 1.34 | 0.99 |
Book value / share | 17.1 | 15.35 |
Institutional Own % | n/a | n/a |
Avg Daily Volume | 482527.0 | 534843.0 |
BUY. This stock's P/E ratio indicates a discount compared to an average of 33.18 for the Plastics and Rubber Products Manufacturing subsector and a discount compared to the S&P 500 average of 27.95. For additional comparison, its price-to-book ratio of 9.49 indicates a significant premium versus the S&P 500 average of 4.68 and a significant premium versus the subsector average of 6.88. The price-to-sales ratio is well above the S&P 500 average, but well below the subsector average. The valuation analysis reveals that, ADVANCED DRAINAGE SYSTEMS seems to be trading at a discount to investment alternatives.
Price/Earnings |
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Price/Cash Flow |
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WMS 25.80 | Peers 33.18 | WMS 14.85 | Peers 20.50 | |||||||||||||||||||||
Discount. A lower P/E ratio than its peers can signify a less expensive stock or lower growth expectations. WMS is trading at a discount to its peers. |
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. WMS is trading at a significant discount to its peers. |
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Price/Projected Earnings |
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Price to Earnings/Growth |
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WMS 23.69 | Peers 26.18 | WMS 7.87 | Peers 3.49 | |||||||||||||||||||||
Average. An average price-to-projected earnings ratio can signify an subsector neutral stock price and average future growth expectations. WMS is trading at a valuation on par with its peers. |
Premium. 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. WMS trades at a significant premium to its peers. |
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Price/Book |
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Earnings Growth |
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WMS 9.49 | Peers 6.88 | WMS 13.33 | Peers -22.96 | |||||||||||||||||||||
Premium. A higher price-to-book ratio makes a stock less attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet. WMS is trading at a significant premium to its peers. |
Higher. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios. WMS is expected to have an earnings growth rate that significantly exceeds its peers. |
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Price/Sales |
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Sales Growth |
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WMS 4.01 | Peers 4.73 | WMS -9.38 | Peers -2.12 | |||||||||||||||||||||
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. WMS is trading at a discount to its subsector on this measurement. |
Lower. A sales growth rate that trails the subsector implies that a company is losing market share. WMS significantly trails its peers on the basis of sales growth. |
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