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Rating as of

Morningstar’s Analysis

Valuation
Currency in AUD
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1-Star Price

PREMIUM

5-Star Price

PREMIUM

Economic Moat

PREMIUM

Capital Allocation

PREMIUM

We Upgrade Near-Term Earnings Outlook for No-Moat ALS. FVE Increased to AUD 5.90.

Mark Taylor Senior Equity Analyst

Analyst Note

| Mark Taylor |

We increase our fair value for no-moat materials testing specialist ALS by 7% to AUD 5.90. Time value of money is a material driver, but near-term earnings upgrades assist. We increase our fiscal 2022 underlying EPS forecast by 16% to AUD 0.50. We also increase our fiscal 2022 DPS forecast by 15% to AUD 0.30, assuming a 50% payout ratio. This equates to a modest partially franked 2.4% yield at the current price.

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Company Profile

Business Description

Founded in the 1880s and listing on the ASX in 1952, ALS operates three divisions: commodities, life sciences, and industrial. ALS commodities traditionally generated the majority of underlying earnings, providing geochemistry, metallurgy, inspection and mine site services for the global mining industry. Expansion into environmental, pharmaceutical and food testing areas and commodity price weakness have lessened earnings exposure to commodities.

Contact
32 Shand Street, Stafford
Brisbane, QLD, 4053, Australia
T +61 733677900
Sector Industrials
Industry Consulting Services
Most Recent Earnings
Fiscal Year End Mar 31, 2022
Stock Type
Employees 15,912