Smith Midland Corp (SMID) 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 below its 5-year median

Smith Midland's EV/EBITDA of 7.2 is below its 5-year median of 13.2.

P/B below the industry

Smith Midland's price-to-book of 1.94 is below the Materials median of 2.43.

Trading below fair value

The share price of $20.86 is below our fair value estimate of $29.34.

Margin of safety over 20%

The price is 28.9% below fair value, more than the 20% cushion we look for.

Revenue growing 10%+ a year

Revenue grew 23.1% a year over the last three fiscal years.

EPS growing 10%+ a year

Diluted EPS grew 151% a year over the last three fiscal years.

Earnings growth not accelerating

Net income grew -35.8% over the last twelve months, against a 5-year average of 36.2% a year.

Growing slower than the industry

Revenue grew -1.6% over the last twelve months; the Materials median is 2.3%.

Company guidance

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

Gross margin slipping

Gross margin was 23.5% over the last twelve months, against 28.3% a year earlier.

Return on equity under 15%

Return on equity was 14.5% over the last twelve months and averaged 15.7% over five years; we look for 15% on both.

Return on capital over 10%

Return on invested capital was 16.8%, above the 10% that usually covers the cost of capital.

Return on equity above the industry

Smith Midland's return on equity of 14.5% is above the Materials median of 5.1%.

Earnings grew over 5 years

Net income grew 36.2% a year on average over the last five fiscal years.

Net margin above its 5-year average

Net margin was 8.6% over the last twelve months, against a 5-year average of 8.2%.

Net margin above the industry

Smith Midland's net margin of 8.6% is above the Materials median of 2.8%.

Low debt

Debt is 6.1% of shareholders' equity, under the 40% we consider low.

Debt falling against equity

Debt to equity fell from 17.7% five years ago to 6.1%.

Debt covered by cash flow

Operating cash flow over the last twelve months equals 419% of total debt.

Interest well covered

Operating income covers interest expense 48.9 times.

Short-term assets cover short-term debts

Current assets are 4.06 times current liabilities.

Low bankruptcy risk

The Altman Z-score is 4.96; above 3 is the safe zone and below 1.8 the distress zone.

No dividend

Smith Midland 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.