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Fundamental analysis: Alcon Inc. (ALC)

Awarener score: 4.5

Conclusion

Note: All scores range from 1 (worst) to 10 (best). Conclusions are updated daily with closing stock prices and new reported quarterly financial statements.

Revenue score: 4.0

• Business has been slightly shrinking. It's been below average when measured against peer companies.
• Alcon Inc. business stability could not be estimated, due to insufficient input data. It looks we cannot compare it to rivals.

Margins score: 4.8

• ALC profit margins -on goods and services sold- are usually good. They stand somewhat worse than rival companies.
• Business profit on sales tends to be meagre. It's almost average when measured against competitors.
• Profits on sales made -available to repay debt and purchase properties- are usually sufficient. They remain rather normal in relation to peers.
• Earnings -before income taxes and interests on loans taken- tend to be meagre in relation to total revenues. They're still slightly worse than similar companies.
• Profits -before income taxes- are usually meagre considering total sales, and remain almost average when measured against rivals.
• Total net profit tends to be meagre when confronted to sales. Company stands almost average when measured against comparable firms.

Growth score: 3.1

• Alcon Inc. profit -on goods and services sold- has been growing at a good pace. It's been in good shape compared to competitors.
• In recent years, the firm hasn't always been able to profit from operations, which has been bottom tier against comparable firms.
• Profits -available to repay debt and purchase properties- have been growing at an extremely fast pace, which compares top tier when measured against peer enterprises.
• In the previous years, the firm couldn't always make a profit -before income taxes and interests on loans taken-. It turns to be a disappointment compared to similar stocks.
• In past years, at least once the company lost money -before income taxes-. It was bottom tier against rivals.
• In the previous years, the firm had at least a total net loss, and last-in-rank when measured against peer companies.
• The company lost money at least once in the past years. It's been a disappointment compared to industry peers.

Miscellaneous score: 4.3

• ALC had still to pay income taxes, even though in recent past years mostly lost money. It's been bottom tier against peers.
• Research and development expenses consume a low portion of revenues. It's almost average when measured against competitors.
• The company grows sparsely in relation to research and development efforts. It stands in a weak position compared to rival companies.

Profitability score: 4.8

• Alcon Inc. usually gets hardly sufficient returns on the resources it controls. It proves almost average when measured against peer firms.
• The company normally gets low proceeds -on the resources directly invested in the business-. They remain close to average when compared to similar companies.
• Profitability -in relation to owned resources- is usually modest. It ranks almost average when measured against competitors.
• In the past, got barely sufficient returns -on the tangible resources it controls-. This metric is usually related to the industry in which operates and combines profitability versus reinvestment needs. It's almost average when measured against comparable enterprises.

Usage of Funds score: 4.5

• ALC usually uses a large portion of genuine funds generated to buy or replace property, plant, or equipment. The need for reinvestments is large. It stands almost average when measured against rival firms.
• The company is usually replacing the property, plant, and equipment that gets old, keeping its operating capabilities up to date, which is almost average when measured against industry peers.
• In the past twelve months the stock paid no dividends. It came bottom tier against competitors.
• The company pays no dividend, so measuring its growth is meaningless. The company has behaved in an conservative way compared to similar firms.
• As no dividends are paid, it is useless trying to estimate their sustainability in time. Sustainability looks not applicable in regard to comparable companies.
• The company barely enlarges the pool of investors, resulting in slightly more mouths feeding on the pie of profits. It remains in good shape compared to peer enterprises.
• We are not sure on the effectiveness of the company when repurchasing shares, as there were not enough numbers to crunch. It stands unidentified against rivals.
• We do not have sufficient data to comment on buybacks and their sustainability. It still looks dubious against competitors.

Balance Sheet score: 3.9

• Alcon Inc. intangible assets (like brands and goodwill) represent a significant portion of resources controlled, according to accounting books. There could be significant difficulties in liquidating them if the company ever gets in financial distress. It happens to be substantially worse when measured against peer companies.
• The company has roughly double short-term resources than short-term obligations. Liquidity concerns are normally not an issue. It turns to be in a weak position compared to similar firms.
• Roughly a tenth of resources controlled were provided for with financial debt. Creditors have minor claims on the company, and financial position is safe. It remains somewhat better than rival firms.
• Most controlled resources might be only slowly turned into cash and equivalents, which is risky. It looks last-in-rank when measured against rivals.
• For every dollar of short-term obligations, the company has enough dollars in cash and short-term receivables. It's in a weak position compared to peer firms.
• For every dollar of short-term obligations, the company has roughly half of cash and equivalents, which is mediocre against similar enterprises.
• Usually, sales are on slightly higher than two months credit. It still ranks weak when measured against peers.
• Normally has approximately six months of sales worth in inventory. It comes up as in a weak position compared to competitors.
• On average, it takes a lot of months from the purchase to charging customers. It happens to be mediocre against peers.
• On average pays suppliers approximately three months after the purchase. It ranks more than average in relation to industry peers.
• The company pays its suppliers six months or more before charging its customers, so there's abundant money invested in working capital. It's lacking compared to similar companies.
• Has usually been losing money on the business, so net interest expenses must be paid by increasing borrowings, which is unsustainable in the long run. The situation is very risky for both creditors and shareholders, profitability must increase. It stands bottom tier against rival firms.
• Business earnings have usually been quite good when measured against loans taken. Cutting back reinvesting in the business, it could take around three years to repay the obligations with current profitability. It ranks weak when measured against comparable enterprises.
• Revenues are somewhat low in relation to property, plant, and equipment required to operate. This metric is likely dependent on the industry the company operates in. The more property, plant, and equipment used, the more the company must reinvest to fight obsolescence, which usually means less available funds for the shareholders in the long run. It looks in a weak position compared to similar firms.
• Resource exploitation is low when yearly sales are considered, business volume must be significantly increased. This metric is normally tied to the industry where the firm belongs. It's still worse than most peer companies.

Valuation score: 3.9

• Alcon Inc. profits are really small compared to market valuation, market valuation doesn't rely on current earnings. It happens to be substantially worse when measured against competitors.
• Price-to-Tangible-Book-Value is a fairly complex metric. Run again in analytical mode if you're interested in a technical explanation. It remains in a very weak position compared to peers.
• In the past twelve months, the company neither generated nor consumed funds. Whatever funds it could generate, it reinvested in the business, which stands slightly better than similar companies.
• In the past years the company barely generated enough genuine funds to cover up for its business needs. Business prospects should improve to be in a better position to reward investors. It's still almost average when measured against industry firms.
• In the past twelve months, the company has slightly enlarged the pool of investors by issuing new shares. The pie of earnings will now be split among a little more stockholders. It came up close to average when compared to peer ventures.
• The company has barely more debt than cash. It may borrow extra money if it wishes so, or start cumulating cash for future uses. It looks somewhat worse than similar enterprises.
• Considering the past twelve months, traditional Price-to-Earnings relation is huge, as profits were extremely low in relative terms. It ranks substantially worse when measured against peer companies.
• Comparing the current stock price with the past twelve-months revenues gives a very high relationship. This is an important metric to check its evolution through time, and to compare to industry peers. It looks close to average when compared to rival firms.
• The relation between the stock price and accounting book value is high, which may be good or bad depending on context. Run again in analytic mode if you want to dig deeper. The company remains somewhat better than peer firms.
• In the past twelve months, the operating business lost a little money. It happens to be similar to industry peers.
• In an alternate metric of bang for the buck, the company has usually shown a somewhat low earnings power ability when measured against the current stock price and financial position. It's still lacking compared to peer companies.

Total score: 4.2

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Awarener score: 4.5

Conclusion

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