Altair Engineering Inc., together with its subsidiaries, provides software and cloud solutions in the areas of simulation, high-performance computing, data analytics, and artificial intelligence in the United States and internationally. The company operates in two segments: Software and Client Engineering Services. The Software segment offers solvers and optimization technology products, high-performance computing software applications and hardware products, modeling and visualization tools, data analytics and analysis products, and Internet of Things platform and analytics tools, as well as support and the complementary software products. This segment also provides software technologies in the areas of computational fluid dynamics and fatigue, manufacturing process simulation, and cost estimation for the applications in marine, motorcycle, aerospace, chemical, and architecture industries; and software-related services, such as consulting, implementation, and training services that focuses on the product design and development expertise and analysis from the component level up to complete product engineering at various stage of the lifecycle. The Client Engineering Services segment provides client engineering services. In addition, the company is involved in the development and sale of solid state lighting technology along with communication and control protocols based on its intellectual property for the direct replacement of fluorescent light tubes with LED lamps. Its integrated suite of software optimizes design performance across various disciplines, including structures, motion, fluids, thermal management, electromagnetics, system modeling, and embedded systems. The company serves universities, government agencies, manufacturers, pharmaceutical firms, banking, financial services, and insurance, weather prediction agencies, and electronics design companies. Altair Engineering Inc. was incorporated in 1985 and is headquartered in Troy, Michigan.
Discounted Cash Flow Valuation of Altair Engineering Inc.
In the chart Earnings are multiplied by this value.
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.
The average Net Margin over the past 5 years is -6.58%.
The trend of Net Margin over the past 5 years is +2.72%.
The average ROA over the past 5 years is -0.49%.
The trend of ROA over the past 5 years is +1.19%.
The average ROE over the past 5 years is -28.87%.
The trend of ROE over the past 5 years is +21.8%.
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.
The Debt/FCF trailing twelve month is 2.85.
The trend of Debt/FCF over the past 5 years is 1.68.
Graham’s Stability measure stands at -.
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.
The Revenue CAGR over the past 5 years is +11.41%.
The trend of Revenue growth rate over the past 5 years is +0.01%.
The Earnings CAGR over the past 5 years is -15.26%.
The trend of Earnings growth rate over the past 5 years is 0%.
The Equity CAGR over the past 5 years is +56.55%.
The trend of Equity growth rate over the past 5 years is -72.25%.
The FCF CAGR over the past 5 years is +28.41%.
The trend of FCF growth rate over the past 5 years is -15.57%.