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Fundamental analysis: Ashland Inc. (ASH)

Awarener score: 6.2

Conclusion

The higher the Awarener score, the more bang you get for the buck. It measures how much genuine funds the company generates for the stock price paid (Good), the business stability (Good) and growth (Bottom), and the company's inclination to return cash to the stockholders (Excellent).

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 shrinking at a very fast pace. It's been last-in-rank when measured against peer companies.
  • Ashland Inc. business trend stability is good. The higher the stability, the lower the risk. It looks better than most rivals.

Margins score: 6.7

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

Growth score: 3.4

  • Ashland Inc. profit -on goods and services sold- has been shrinking. It's been in a very weak position 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 excellent pace, which compares more than average in relation to peer enterprises.
  • Earnings -before income taxes and interests on loans taken- have been growing at an excellent tempo. It turns to be impressive in relation 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: 3.7

  • ASH 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 very little portion of revenues. It's weak when measured against competitors.
  • Business has seen substantial shrinking, despite research and development efforts. It stands a disappointment compared to rival companies.

Profitability score: 7.2

  • Ashland Inc. usually gets good returns on the resources it controls. It proves below average when measured against peer firms.
  • The company normally gets excellent proceeds -on the resources directly invested in the business-. They remain in a weak position compared to similar companies.
  • Profitability -in relation to owned resources- is usually modest. It ranks weak when measured against competitors.
  • In the past, got very good 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 below average when measured against comparable enterprises.

Usage of Funds score: 4.6

  • ASH usually uses a very large portion of genuine funds generated to buy or replace property, plant, or equipment. The need for reinvestments is heavy. It stands below average when measured against rival firms.
  • The company is usually replacing part of the property, plant, and equipment that gets old, keeping some funds for something else. It can't keep forever, which is substantially worse when measured against industry peers.
  • In the past twelve months it paid somewhat low dividends, considering the current stock price. It came slightly worse than competitors.
  • Dividend payments have been more or less stable in recent years. The company has behaved close to average when compared to similar firms.
  • The company usually uses a portion of genuine funds generated to pay dividends. Dividend payments should be safe, unless business prospects are challenged. Sustainability looks worse than most comparable companies.
  • The company usually reduces the pool of investors, resulting in fewer mouths feeding on the pie of profits. It remains in good shape compared to peer enterprises.
  • Repurchase effectiveness metric is very complex. Run again in analytical mode if you're interested in a technical explanation. It stands a slight improvement compared to rivals.
  • The company uses a lot more funds to reward investors than it can genuinely generate, so they're paid out of existing cash or by borrowing money, both of which will eventually reach a limit. Either business improves, or rewards won't keep at current pace. It still looks substantially worse when measured against competitors.

Balance Sheet score: 4.2

  • Ashland Inc. has not disclosed intangibles assets, so we could not reach a meaningful conclusion on this metric. It happens to be a not known variable when measured with peer companies.
  • The company has more than enough short-term resources to face short-term obligations. Liquidity concerns are non-significant. It turns to be rather normal in relation to similar firms.
  • Roughly a quarter of resources controlled were provided for with financial debt. Creditors have some claims on the company. It remains somewhat better than rival firms.
  • Most controlled resources take time to be turned into cash and equivalents, which is somewhat risky. It looks weak when measured against rivals.
  • For every dollar of short-term obligations, the company has more than enough dollars in cash and short-term receivables. It's a slight improvement compared to peer firms.
  • For every dollar of short-term obligations, the company has roughly another of cash and equivalents, which is well ranked against similar enterprises.
  • Usually, sales are on somewhat less than three months credit. It still ranks below average when measured against peers.
  • Normally has approximately five months of sales worth in inventory. It comes up as in a very weak position compared to competitors.
  • On average, it takes a lot of months from the purchase to charging customers. It happens to be worse than most peers.
  • Pays suppliers mostly in cash. It ranks encouraging in relation to industry peers.
  • The company pays its suppliers plenty of months before charging its customers, so there's a lot of money invested in working capital. It's in a very weak position compared to similar companies.
  • Net interest expenses consume a significant portion of usual business earnings, but are mostly bearable. It stands slightly better than rival firms.
  • Business earnings have usually been good when measured against loans taken. Cutting back reinvesting in the business, it could take less than three years to repay the obligations with current profitability. It ranks similar to comparable enterprises.
  • Revenues are very good in relation to property, plant, and equipment required to operate. This metric is likely dependent on the industry the company operates in. Low property, plant, and equipment requirements allows the company to keep more money to reward stockholders in the long run. It looks in a weak position compared to similar firms.
  • Resource exploitation is slightly low when yearly sales are considered, business volume should be increased. This metric is normally tied to the industry where the firm belongs. It's still worse than most peer companies.

Valuation score: 6.7

  • Ashland Inc. looks very cheap in relation to profits and financial position. It happens to be top tier 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 lacking compared to peers.
  • In the past twelve months, the company generated some slightly better free funds in relation to the stock price, which stands mediocre against similar companies.
  • The company usually generates somewhat more than enough genuine funds to cover up for its business needs. Surplus cash may be used to repay loans, to eventually buy new businesses, or to reward investors. Considering the financial position and stock price, the current valuation might be reasonable. It's still weak when measured against industry firms.
  • In the past twelve months, the company has rewarded investors, considering both dividends and share on the pie of earnings. It came up excellent in relation to peer ventures.
  • The company is somewhat indebted, loan repayment needs to be taken into account. It looks somewhat better than similar enterprises.
  • Considering the past twelve months, traditional Price-to-Earnings relation looks very cheap. Possible reasons are that the market might be betting current earnings will be hard to sustain through time, or that the company has very high fund needs, or a weak financial position, among others. If that isn't the case, the current stock price might be very attractive. It ranks great when measured against peer companies.
  • Comparing the current stock price with the past twelve-months revenues gives a three or four to one relationship. This is an important metric to check its evolution through time, and to compare to industry peers. It looks in a weak position compared to rival firms.
  • We have not enough information on the relation between current stock price and accounting book value. The company remains a mystery against peer firms.
  • In the past twelve months, the operating business earned great money when compared to the current stock price and financial position. It happens to be top tier when measured against industry peers.
  • In an alternate metric of bang for the buck, the company has usually shown a very good earnings power ability when measured against the current stock price and financial position. It's still a slight improvement compared to peer companies.

Total score: 5.1


ASH logos

Company at a glance: Ashland Inc. (ASH)

Sector, industry: Basic Materials, Specialty Chemicals

Market Cap: 5.26 billions

Revenues TTM: 2.08 billions

Ashland Inc. provides additives and specialty ingredients worldwide. It operates through Life Sciences; Personal Care & Household; Specialty Additives; and Intermediates and Solvents segments. The Life Sciences segment offers pharmaceutical solutions, including controlled release polymers, disintegrants, tablet coatings, thickeners, solubilizers, and tablet binders; nutrition solutions, such as thickeners, stabilizers, emulsifiers, and additives; and nutraceutical solutions comprising products for weight management, joint comfort, stomach and intestinal health, sports nutrition, and general wellness, as well as custom formulation, toll processing, and particle engineering solutions. The Personal Care & Household segment provides a range of nature-based, biodegradable, and performance ingredients; solutions for toothpastes, mouth washes and rinses, denture cleaning, and care for teeth; and household supplies nature-derived rheology ingredients, biodegradable surface wetting agents, performance encapsulates, and specialty polymers. The Specialty Additives segment offers rheology modifiers, foam control agents, surfactants and wetting agents, pH neutralizers, advanced ceramics used in catalytic converters, environmental filters, ingredients for the manufacturing of ceramic capacitors, plasma display panels and solar cells, ingredients for textile printing, thermoplastic metals, and alloys for welding. The Intermediates and Solvents segment produces 1,4 butanediol and related derivatives, including n-methylpyrrolidone. It offers its products to customers in a range of consumer and industrial markets, such as architectural coatings, construction, energy, food and beverage, nutraceuticals, personal care, and pharmaceutical. The company was formerly known as Ashland Global Holdings Inc. Ashland Inc. was founded in 1924 and is based in Wilmington, Delaware.

Awarener score: 6.2

Conclusion

The higher the Awarener score, the more bang you get for the buck. It measures how much genuine funds the company generates for the stock price paid (Good), the business stability (Good) and growth (Bottom), and the company's inclination to return cash to the stockholders (Excellent).