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Allison Transmission Holdings Inc

ALSN

Motor Vehicle Parts & Accessories

Mkt Cap

$4.831B

PE

7.50

Debt

$2.526B

Cash

$501M

EV

$6.856B

FCF

$605M

Market Cap

$4.831B

P/E Ratio

7.50

Debt

$2.526B

Cash

$501M

EV

$6.856B

FCF

$605M

Allison Transmission Holdings, Inc., together with its subsidiaries, designs, manufactures, and sells commercial and defense fully automatic transmissions for medium-and heavy-duty commercial vehicles, and medium-and heavy-tactical U.S. defense vehicles worldwide. The company offers transmissions for various applications, including distribution, refuse, construction, fire, and emergency on-highway trucks; school and transit buses; motor homes; energy, mining, and construction off-highway vehicles and equipment; and wheeled and tracked defense vehicles. It provides its transmissions and electric propulsion solutions under the Allison Transmission brand name; and remanufactured transmissions under the ReTran brand name. The company also sells branded replacement parts, support equipment, aluminum die cast components, and other products necessary to service the installed base of vehicles utilizing its solutions, as well as defense kits, engineering services, and extended transmission coverage services to various original equipment manufacturers, distributors, and the U.S. government. It serves customers through an independent network of approximately 1,600 independent distributor and dealer locations. The company was formerly known as Clutch Holdings, Inc. Allison Transmission Holdings, Inc. was founded in 1915 and is headquartered in Indianapolis, Indiana.

Sector

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Growth

%

%

Discount

%

%

Multiple

g\r+10%+11%+12%+13%+14%
0%109887
+1%1110988
+2%13111098
+3%141311109
+4%1714121110
Years012345678910TV
FCF$605M$600.7M$596.4M$592.2M$588M$583.8M$579.6M$575.5M$571.4M$567.3M$563.3M$5.633B
DCF$522.3M$451M$389.4M$336.2M$290.2M$250.6M$216.3M$186.8M$161.3M$139.2M$1.392B
Value$4.336B

In the chart Earnings are multiplied by this value.

Earnings Growth 12%
Earnings Stability 41%


Competitiveness and MOAT

High margins render the company resilient under dire circumstances, hence able to drive competitors out or acquire them. ROE and ROA measure the average flow generated by each invested dollar. Their marginal value is a forecast of future growth, and it is considered by Buffett and Munger the most important single indicator.

Years12-201412-201512-201612-201712-201812-201912-202012-202112-2022TTM
Net Margin11%9.2%12%22%24%22%14%18%19%22%
ROA11%9.7%11%16%22%20%12%15%17%18%
ROE16%15%20%73%97%77%40%70%61%54%

What is the average Net Margin?

The average Net Margin over the past 5 years is +20.03%.

What is the trend of Net Margin?

The trend of Net Margin over the past 5 years is -1.11%.

What is the average Return on Assets (ROA)?

The average ROA over the past 5 years is +16.84%.

What is the trend of Return on Assets (ROA)?

The trend of ROA over the past 5 years is -0.63%.

What is the average Return on Equity (ROE)?

The average ROE over the past 5 years is +69.58%.

What is the trend of Return on Equity (ROE)?

The trend of ROE over the past 5 years is -5.19%.


Safety & Stabiliy

Being debt the number one cause of investment losses and company death, the ratio Debt/FCF is of utmost importance to guarantee safety. On the other hand the Graham’s stability measures the drawdown of earnings, hence indicating the reliability of the flow generated by the company.

Years12-201412-201512-201612-201712-201812-201912-202012-202112-2022TTM
Debt FCF5.154.654.234.563.463.785.705.525.174.18
Debt Equity1.822.042.043.763.873.273.374.002.902.13
MIN
Graham Stability--100%100%100%100%51%86%100%51%

What is the Debt/FCF?

The Debt/FCF trailing twelve month is 4.18.

What is the trend of Debt/FCF?

The trend of Debt/FCF over the past 5 years is 0.32.

What is the Graham’s Stability?

Graham’s Stability measure stands at 0.51.


Growth

Growth can be dangerous when forecasting, simply projecting the current growth is in general wrong. A company passes through multiple phases, from being young and unprofitable, to the first periods of profitability and high growth, until it arrives at a period of regime with limited growth. Identifying in which phase the company is in may help forecasting.

Years12-201512-201712-201912-2021Trend
Revenue4.9%4.1%0.87%15%0.52%
Net Income17%1%-4.2%20%-2.4%
Stockholders Equity-4.3%4.9%3.8%38%3.8%
FCF-0.89%-2.9%-10%6.5%-3.1%

What is the 5 year Revenue CAGR?

The Revenue CAGR over the past 5 years is +4.13%.

What is the trend of Revenue growth?

The trend of Revenue growth rate over the past 5 years is +0.52%.

What is the 5 year Earnings CAGR?

The Earnings CAGR over the past 5 years is +1.05%.

What is the trend of Earnings growth?

The trend of Earnings growth rate over the past 5 years is -2.41%.

What is the 5 year Equity CAGR?

The Equity CAGR over the past 5 years is +4.87%.

What is the trend of Equity growth?

The trend of Equity growth rate over the past 5 years is +3.76%.

What is the 5 year FCF CAGR?

The FCF CAGR over the past 5 years is -2.88%.

What is the trend of FCF growth?

The trend of FCF growth rate over the past 5 years is -3.11%.