Macroaxis Stories

Is Apogee Enterprises growth trend slowing down?

September 17, 2024  By Rifka Kats
Macroaxis Story
Apogee Enterprises appears to be an intriguing investment opportunity as it gears up for the next quarter. With a solid revenue of $1.4B and a net income of $99.6M, the company showcases a healthy operating margin of 12.48%. Despite a slight net interest loss of 6.7M, its EBITDA stands at a robust $183.14M, indicating strong operational efficiency. The current valuation of $1.52B, coupled with a trailing PE ratio of 13.73, suggests that the stock may be undervalued, especially given its return on equity of 24.05%. With a low probability of bankruptcy at 1% and a manageable debt-to-equity ratio of 0.83%, Apogee seems well-positioned for growth. The last dividend paid was $0.98, reflecting a commitment to returning value to shareholders. For those looking for a potentially profitable exit next quarter, now might be the right moment to consider adding Apogee to their portfolio. With many baby boomers showing little interest in the building products sector, Apogee Enterprises stands out as a company worth considering. The question is whether Apogee can continue to achieve above-average profit margins. Is its current valuation reasonable? In this analysis, I will explore the company's financial outlook and provide insights to help you decide if investing in Apogee Enterprises is a smart move.
Published over two months ago
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Reviewed by Gabriel Shpitalnik

Apogee Enterprises has $106.19 million in liabilities and a debt-to-equity ratio of 0.83, which is fairly typical for its industry. The company’s current ratio stands at 1.78, indicating it can cover its short-term obligations comfortably. When evaluating Apogee's debt, it's important to also consider its cash and equity. Macroaxis offers impartial investment recommendations for Apogee Enterprises, which can enhance your understanding alongside existing analyst opinions. Their trade advice engine assesses the company's growth potential based on your individual risk tolerance and investment timeline.

Main Takeaways

Apogee Enterprises appears to be an attractive investment opportunity, especially with a trailing price-to-earnings ratio of 13.73, suggesting the stock is reasonably valued compared to its earnings potential. Additionally, the company's current ratio of 1.82 indicates a solid liquidity position, which could provide stability in the upcoming quarter. With institutional ownership at a high 96.29%, investor confidence in Apogee's future performance seems strong, making it a compelling option for those seeking a profitable exit soon.
We determine the current worth of Apogee Enterprises using both absolute as well as relative valuation methodologies to arrive at its intrinsic value. In general, an absolute valuation paradigm, as applied to this company, attempts to find the value of Apogee Enterprises based exclusively on its fundamental and basic technical indicators. By analyzing Apogee Enterprises's financials, quarterly and monthly indicators, and related drivers such as dividends, operating cash flow, and various types of growth rates, we attempt to find the most accurate representation of Apogee Enterprises's intrinsic value. In some cases, mostly for established, large-cap companies, we also incorporate more traditional valuation methods such as dividend discount, discounted cash flow, or asset-based models. As compared to an absolute model, our relative valuation model uses a comparative analysis of Apogee Enterprises. We calculate exposure to Apogee Enterprises's market risk, different technical and fundamental indicators, relevant financial multiples and ratios, and then comparing them to Apogee Enterprises's related companies.

Apogee Enterprises Investment Alerts

Apogee investment alerts and warnings help investors to get more proficient at understanding not only critical technical and fundamental signals but also the significant portfolio-centered indicators. These indicators include beta, alpha, and other risk-related measures that will help you in monitoring Apogee Enterprises performance across your portfolios.Please check all investment alerts for Apogee

Apogee Enterprises Valuation Ratios as Compared to Competition

Our valuation model uses many indicators to compare Apogee value to that of its competitors to determine the firm's financial worth. You can analyze the relationship between different fundamental ratios across Apogee Enterprises competition to find correlations between indicators driving the intrinsic value of Apogee.

Apogee Enterprises Gross Profit

Apogee Enterprises Gross Profit growth is one of the most critical measures in evaluating the company. The Gross Profit growth rate is calculated simply by comparing Apogee Enterprises previous period's values with its current period's values. Each time period you're measuring should be of equal lengths the increase or decrease, in a company's Gross Profit between two periods. Here we show Apogee Enterprises Gross Profit growth over the last 10 years. Please check Apogee Enterprises' gross profit and other fundamental indicators for more details.

A Deeper look at Apogee

The entity reported the previous year's revenue of 1.42 B. Net Income was 99.61 M with profit before overhead, payroll, taxes, and interest of 302.36 M.

Margins Breakdown

Apogee profit margins show the degree to which it makes money. Margin indicators are used not only by investors but also by creditors or Apogee Enterprises itself as indicators of financial health and management effectiveness. Please look more closely at the different varieties of Apogee Enterprises profit margins.
0.0633
Operating Profit Margin
0.0446
Net Profit Margin
0.0575
Pretax Profit Margin
Pretax Profit Margin0.0575
Operating Profit Margin0.0633
Net Profit Margin0.0446
Gross Profit Margin0.23
Apogee Enterprises Price To Sales Ratio is decreasing over the last 5 years. Apogee Enterprises Dividend Yield is increasing over the last 5 years. Additionally, Apogee Enterprises Ptb Ratio is nearly stable at the moment. Apogee Enterprises Price To Sales Ratio is decreasing over the last 5 years.
The current value of Apogee Enterprises Price To Sales Ratio is 0.58. Apogee Enterprises Dividend Yield is increasing over the last 5 years. Additionally, Apogee Enterprises PTB Ratio is decreasing over the last 5 years. "Opportunities don't happen. You create them." – Chris Grosser. As we look at Apogee Enterprises, the stock currently trades around a typical price of 66.55, which is close to its target price of 67.50, suggesting limited upside potential in the short term. The company's current ratio of 1.82X indicates a solid liquidity position, while its trailing P/E of 13.73 suggests it may be undervalued compared to industry peers. However, with quarterly revenue growth at -0.08 and net interest income losses of 6.7 million, investors should proceed with caution. Given these mixed signals, now might be a strategic time to consider a position, but a thorough assessment of market conditions and company performance is essential for a profitable exit next quarter..

Apogee Enterprises implied volatility may change after the rise

Apogee Enterprises has experienced a notable change in its stock's implied volatility, with the coefficient of variation dropping to 1871.18 today. This decline indicates that the market is stabilizing in its expectations for the company, potentially creating a more predictable trading environment. For investors, this shift could present an interesting opportunity to benefit from a steadier stock price in the weeks ahead. Currently, Apogee shows below-average downside risk, with an Information Ratio of 0.0 and a Jensen Alpha of -0.07. Understanding these volatility trends can help investors time their moves effectively.
Increased volatility during bear markets can significantly affect Apogee's stock price, often prompting investors to adjust their portfolios as they react to falling prices.Investing in Apogee Enterprises stock appears promising as we move into October. With an analyst consensus leaning towards a "Hold," the stock is currently valued at around 66.87, while the estimated target price hovers around 53. This suggests that there is still room for growth, especially considering the highest estimated target price of 58.83. As the fiscal year wraps up in February, investors may find opportunities to capitalize on potential upward movements in the stock. Overall, while caution is advised, the outlook remains intriguing for those looking to add Apogee to their portfolio..

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Editorial Staff

Rifka Kats is a Member of Macroaxis Editorial Board. Rifka writes about retail product and service companies from the perspective of a regular consumer and sophisticated investor at the same time. She is passionate about corporate ethics and equality in the workforce. View Profile
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 Rifka Kats do not own shares of Apogee Enterprises. Please refer to our Terms of Use for any information regarding our disclosure principles.

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