Astec Story

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ASTE -- USA Stock  

USD 75.21  0.01  0.0133%

Astec Inds is scheduled to announce its earnings tomorrow. The upcoming quarterly report is expected on the 1st of March 2021. Astec Inds 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 272,284. The current year Average Assets is expected to grow to about 959.4 M, whereas Interest Coverage is forecasted to decline to 115.25. As many passive investors are finally getting excited about industrials space, Astec Inds could be a good starting point. Let's discuss the possibilities of Astec Inds maintaining its debt level in March.
Published over a month ago
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Continue to hold Astec (NASDAQ:ASTE) based on its current debt obligations?
The company currently holds 7.49 M in liabilities with Debt to Equity (D/E) ratio of 0.01, which may suggest the firm is not taking enough advantage from borrowing. Astec Inds has a current ratio of 3.24, suggesting that it is liquid enough and is able to pay its financial obligations when due. The company has Profit Margin (PM) of 1.23 %, which maeans that even a very small decline in it revenue will erase profits resulting in a net loss. This is way below average. Similarly, it shows Operating Margin (OM) of 3.46 %, which suggests for every 100 dollars of sales, it generated a net operating income of 0.03.
Astec Inds financial leverage ratio helps determine the effect of debt on the overall profitability of the company. It measures the total debt position of Astec Inds, including all of Astec Inds'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 Inds assets, the company is considered highly leveraged. Understanding the composition and structure of overall Astec Inds 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 Inds liabilities are broken down into two parts on the balance sheet. These are short-term (or current) obligations and long-term debt. Astec Inds 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 Inds balance sheet include debt obligations and money owed to different Astec Inds 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 Inds financial leverage analysis tool to get a better grip on understanding its financial position

How important is Astec Inds's Liquidity

Astec Inds financial leverage refers to using borrowed capital as a funding source to finance Astec Inds ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. Astec Inds 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 Inds's total debt and its cash.

Detailed Perspective On Astec Inds

The entity reported the previous year's revenue of 1.07 B. Net Income was 13.19 M with profit before overhead, payroll, taxes, and interest of 239.41 M.

Asset Breakdown

323.6 M
Assets Non Current
Tax Assets
613.2 M
Current Assets
Total Assets936.86 Million
Current Assets613.22 Million
Assets Non Current323.65 Million
Goodwill58.53 Million
Tax Assets49.54 Million

Astec showing appearance of lower volatility

Latest expected short fall is at -2.09. Astec Inds has relatively low volatility with skewness of 1.66 and kurtosis of 6.74. However, we advise all investors to independently investigate Astec Inds to ensure all accessible information is consistent with the expectations about its upside potential and future expected returns. Understanding different market volatility trends often help investors to time the market. Properly using volatility indicators enable traders to measure Astec Inds' stock risk against market volatility during both bullying and bearish trends. The higher level of volatility that comes with bear markets can directly impact Astec Inds' stock price while adding stress to investors as they watch their shares' value plummet. This usually forces investors to rebalance their portfolios by buying different stocks as prices fall.

Our Takeaway on Astec Inds Investment

Although other entities under the farm & heavy construction machinery industry are still a bit expensive, Astec Inds may offer a potential longer-term growth to shareholders. The bottom line, as of the 28th of February 2021, our research shows that Astec Inds is a rather very steady investment opportunity with a below average probability of distress in the next two years. From a slightly different view, the entity currently appears to be overvalued. Our ongoing 30 days buy-sell recommendation on the firm is Cautious Hold.

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 Ellen Johnson do not own shares of Astec Inds. Please refer to our Terms of Use for any information regarding our disclosure principles.

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