Astec Story

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ASTE -- USA Stock  

USD 59.23  0.33  0.56%

Astec Industries is scheduled to announce its earnings today. The next earnings report is expected on the 16th of March 2021. The stock experiences an active downward rally. Astec Industries Revenue Per Employee is projected to increase significantly based on the last few years of reporting. The past year's Revenue Per Employee was at 302,538. The current year Average Assets is expected to grow to about 883.9 M, whereas PPandE Turnover is forecasted to decline to 5.57. While some millenniums are indifferent towards industrials space, it makes sense to digest Astec Industries as a unique investment alternative. We will analyze why Astec Industries investors may still consider a stake in the business.
Published over two weeks ago
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Is Astec Industries (NASDAQ:ASTE) outlook still optimistic based on the latest debt level?
The company currently holds 5.2 M in liabilities with Debt to Equity (D/E) ratio of 0.01, which may suggest Astec Industries is not taking enough advantage from borrowing. The asset utilization indicator refers to the revenue earned for every dollar of assets a company currently reports. Astec Industries has an asset utilization ratio of 140.22 percent. This indicates that the company is making $1.4 for each dollar of assets. An increasing asset utilization means that Astec Industries is more efficient with each dollar of assets it utilizes for everyday operations.
Astec Industries financial leverage ratio helps determine the effect of debt on the overall profitability of the company. It measures the total debt position of Astec Industries, including all of Astec Industries's outstanding debt obligations, and compares it with the equity. In simple terms, the high financial leverage means the cost of production, together with running the business day-to-day, is high, whereas, lower financial leverage implies lower fixed cost investment in the business and generally considered by investors to be a good sign. So if creditors own a majority of Astec Industries assets, the company is considered highly leveraged. Understanding the composition and structure of overall Astec Industries debt and outstanding corporate bonds gives a good idea of how risky the capital structure of a business is and if it is worth investing in it. Please read more on our technical analysis page.

Understanding Astec Total Liabilities

Astec Industries liabilities are broken down into two parts on the balance sheet. These are short-term (or current) obligations and long-term debt. Astec Industries has to fulfill its short-term liabilities in this reporting year and should be no more than 12 months old. Long-term debt, on the other hand, is anything beyond the 12-month payment timeframe. Common short-term liabilities found on Astec Industries balance sheet include debt obligations and money owed to different Astec Industries vendors, workers, and loan providers. Below is the chart of Astec short long-term liabilities accounts currently reported on its balance sheet.
You can use Astec Industries financial leverage analysis tool to get a better grip on understanding its financial position

How important is Astec Industries's Liquidity

Astec Industries financial leverage refers to using borrowed capital as a funding source to finance Astec Industries ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. Astec Industries financial leverage is typically calculated by taking the company's all interest-bearing debt and dividing it by total capital. So the higher the debt-to-capital ratio (i.e., financial leverage), the riskier the company. Please check the breakdown between Astec Industries's total debt and its cash.

Is Astec Industries valued correctly by the market?

Astec Industries reported the previous year's revenue of 1.09 B. Net Income was 14.56 M with profit before overhead, payroll, taxes, and interest of 239.41 M.

Asset Breakdown

298.1 M
Assets Non Current
Goodwill
565.6 M
Current Assets
Total Assets863.64 Million
Current Assets565.59 Million
Assets Non Current298.06 Million
Goodwill52.59 Million
Tax Assets43.08 Million

Astec Industries latest price dip can leaving shareholders with little time to react

The market risk adjusted performance is down to 0.68 as of today. Astec Industries currently demonstrates below-verage downside deviation. It has Information Ratio of 0.11 and Jensen Alpha of 0.3. However, we do advice investors to further question Astec Industries expected returns to ensure all indicators are consistent with the current outlook about its relatively low value at risk.

Our Takeaway on Astec Industries Investment

Although some other firms in the farm & heavy construction machinery industry are either recovering or due for a correction, Astec Industries may not be performing as strong as the other in terms of long-term growth potentials. To conclude, as of the 4th of November 2020, our research shows that Astec Industries is a rather very steady investment opportunity with a average probability of bankruptcy in the next two years. From a slightly different view, the entity currently appears to be undervalued. Our concluding 30 days 'Buy-Sell' recommendation on the firm is Strong Buy.

About Contributor

This story should be regarded as informational only and should not be considered a solicitation to sell or buy any financial products. Macroaxis does not express any opinion as to the present or future value of any investments referred to in this post. This post may not be reproduced without the consent of Macroaxis LLC. Macroaxis LLC and Raphi Shpitalnik do not own shares of Astec Industries. Please refer to our Terms of Use for any information regarding our disclosure principles.

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