Arts Way Manufacturing Co Inc (ARTW) stock analysis

P/E against its history

Not enough price and earnings history to compare.

P/E against the industry

Needs positive earnings and enough profitable companies in the industry.

EV/EBITDA above its 5-year median

Arts Way Manufacturing's EV/EBITDA of 21.6 is above its 5-year median of 8.8.

P/B below the industry

Arts Way Manufacturing's price-to-book of 1.09 is below the Industrial and Commercial Machinery and Computer Equipment median of 2.72.

Trading above fair value

The share price of $2.87 is above our fair value estimate of $2.20.

Margin of safety under 20%

The price is 30.1% above fair value, so there is no margin of safety.

Revenue growing under 10% a year

Revenue grew -3.6% a year over the last three fiscal years, short of the 10% we look for.

EPS growing 10%+ a year

Diluted EPS grew 115% a year over the last three fiscal years.

Earnings acceleration

Needs positive net income now, a year ago and five years ago.

Growing slower than the industry

Revenue grew 4.5% over the last twelve months; the Industrial and Commercial Machinery and Computer Equipment median is 10.1%.

Company guidance

No outlook found in earnings releases from the last twelve months.

Gross margin slipping

Gross margin was 26.0% over the last twelve months, against 31.4% a year earlier.

Return on equity under 15%

Return on equity was -3.0% over the last twelve months and averaged 3.2% over five years; we look for 15% on both.

Return on capital under 10%

Return on invested capital was -0.1%, below the 10% that usually covers the cost of capital.

Return on equity below the industry

Arts Way Manufacturing's return on equity of -3.0% is below the Industrial and Commercial Machinery and Computer Equipment median of 7.3%.

Earnings over 5 years

Needs positive net income five years ago and in the latest year.

Net margin below its 5-year average

Net margin was -1.6% over the last twelve months, against a 5-year average of 1.6%.

Net margin below the industry

Arts Way Manufacturing's net margin of -1.6% is below the Industrial and Commercial Machinery and Computer Equipment median of 4.8%.

Low debt

Debt is 17.2% of shareholders' equity, under the 40% we consider low.

Debt falling against equity

Debt to equity fell from 28.3% five years ago to 17.2%.

Debt covered by cash flow

Operating cash flow over the last twelve months equals 40.6% of total debt.

Interest not well covered

Operating income covers interest expense -0.0 times; we look for at least 5.

Short-term assets cover short-term debts

Current assets are 1.71 times current liabilities.

Bankruptcy risk in the grey zone

The Altman Z-score is 2.46; above 3 is the safe zone and below 1.8 the distress zone.

No dividend

Arts Way Manufacturing has not paid a dividend in the last twelve months.

Yield against Treasuries

No dividend.

Yield against the market

No dividend.

Dividend stability

No dividend.

Earnings cover

No dividend.

Cash-flow cover

No dividend.