NYSE:ABC
$27.75
(3/15 6:59PM)
-0.6%
| Open | $27.9 |
Mkt Cap | $7.8 Billion |
| High | $28.34 |
52Wk High | $28.61 |
| Low | $27.61 |
52Wk Low | $15.90 |
| Volume | 2.8 Million |
Avg Vol 10D | 2.5 Million |
Ockham's Rating/Recommendation Summary
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ABC Revenue
Cash earnings is the most important factor in our analysis, but it goes without saying that if a company cannot produce sales then there is no ability to generate cash flow. By that logic we look very closely at revenue numbers as our second most important factor in valuing a company's stock. We have established reasonable Price to Sales per share ranges based on historical data of the last 10 years. For, ABC the high and low end of the Price to Sales per share ratios are 0.16x and 0.11x respectively.
Notice that ABC's current Price to Sales per share ratio is 0.11x, which is quite a bit below what we consider a normal Price to Sales ratio for this stock. Given normal conditions and a price of $27.93, ABC is 22% below where we would expect to see it. This will beneficially factor into our final analysis of ABC as it is not often that this stock sinks to these levels.
ABC Cash Earnings
Cash Earnings is always one of the most important factors to review for a company and, more importantly, an investment in a stock. ABC is significantly below its historical average multiple of Cash Earnings. Looking at the last 10 years we can get a good understanding of what investors have grown to expect from ABC. For example, ABC's Cash Earnings ratio per share has fluctuated between 14.05 and 20.40 over this historical timeframe. This range is based upon a proprietary weighted methodology at Ockham, but can clearly show an investor where ABC is with respect to prior business periods.
So with ABC's current price (latest close of $27.93) and most recent level of Cash Earnings reported, we see significant opportunity from a value perspective. At its current price level, ABC is 30% below its average level of Price to Cash Earnings on a historical basis. This means that investors were willing to pay for a much higher stock price than currently for the same level of Cash in the past, on a relative basis. There are a couple of important things to remember, however. First, value doesn't exist in a vacuum. So if the market doesn't recognize this value, even a great disparity in Price to Cash Earnings cannot force an immediate stock price reaction. Second, patience is key when looking at securities that have reached these levels of Price to Cash Earnings versus their historical norms. So be patient with ABC.
ABC Dividends
A strong dividend payment history is looked upon as a favorable characteristic on a company’s future and potentially can receive a positive Ockham rating. That being said, we don't require dividend payments for company's whose management has elected to forgo them entirely.
When reviewing dividend yields for ABC, we compare the historic high and low levels over the past, which is similar to our evaluation of Sales and Cash Earnings per share. Paying a dividend is not necessary for any company, but changes in dividend often can lend clues as to the health of the business. A rising dividend is a strong sign for an established company, as it reflects management's confidence in the company. ABC’s estimated annual dividend is $0.32 resulting in a current dividend yield of 1.15%. The highest dividend yield from ABC over recent history was 2.01% while the lowest dividend yield was 0.00%. ABC has shown confidence by hiking up the dividend yield to 14.43% above the historical median.
AmeriSource Bergen Corporation Cash Flow Generation Covered by Squawk On The Street
The latest cash flow information from ABC was covered on Squawk On The Street recently, and investors should be interested in anything that affects their ability to generate cash.
Premium Content - please sign up for Ockham PREMIUM to gain full access and to see what Squawk On The Street said about AMERISOURCE BERGEN CORP.
Learn About RazorWire?A Discussion of Technicals and AmeriSource Bergen Corporation on Power Lunch
For all those that pay attention to technicals, Power Lunch discussed ABC from the technical perspective.
When taking into account the amount of news coverage each stock normally sees as a percentage of the total, AmeriSource Bergen Corporation has actually sunk a bit in comparison to the others. Our sentiment indicator, provided through the Motley Fool CAPS survey, suggests that investors are neutral overall towards ABC and think that it will generally perform in-line with the S&P 500. At present, Ockham has a valuation stance of Undervalued on ABC, as we could see significant price appreciation based on current fundamentals like cash earnings and revenue.
“… Two more s&p stocks hitting highs, AMERISOURCE. Lexmark 10% high eer. > > we're up 90 points on the dow jones industrial average. …”
First ABC News on Squawk On The Street in More Than a Month
After a month of relative quiet from ABC, they have appeared back in the news.
At present, Ockham has a valuation stance of Undervalued on ABC, as we could see significant price appreciation based on current fundamentals like cash earnings and revenue. When taking into account the amount of news coverage each stock normally sees as a percentage of the total, AmeriSource Bergen Corporation has actually sunk a bit in comparison to the others. Our sentiment indicator, provided through the Motley Fool CAPS survey, suggests that investors are neutral overall towards ABC and think that it will generally perform in-line with the S&P 500.
“… AMERISOURCE BERGEN. Obviously health care enjoying the day. We'll see if they'll be selling on the news if the republican wins in massachusetts. > > …”
Inside Track With Deidre Bolton and Erik Schatzker: Margins are in Focus for AmeriSource Bergen Corporation
What portion of sales is ABC turning into profit? Inside Track With Deidre Bolton and Erik Schatzker discussed this topic recently, and any investor will be interested in learnings the latest.
Pretty positive on the stock because it says delinquencies are going down for houses as well as the credit cards. Finally, AMERISOURCE BERGEN, a drug distribution company, 0.5% profit margin and big revenues. >> thank you so much. Some stocks to watch in the future. Everyone is looking for an edge in the job market. These days that might include advertising your vaccination records.
“… Finally, AMERISOURCE BERGEN, a drug distribution company, 0. 5% profit margin and big revenues. > > thank you so much. Some stocks to watch in the future. …”
Earnings Discussion for AmeriSource Bergen Corporation on FirstUp
Earnings are one of the most important fundamental factors we track, so we are always interested in the latest profit reports and news.
The earnings over at wells and warren buffett is the largest shareholder of this company. AMERISOURCE is there. This is a drug company with profit margins of 0.5%. The revenue is larger there that had bowling or goldman sachs. Adam johnson on the stocks to keep your eye on.
“… AMERISOURCE is there. This is a drug company with profit margins of 0. 5%. The revenue is larger there that had bowling or goldman sachs. …”
Looking for Growth? See What Squawk On The Street Said About AmeriSource Bergen Corporation
The other bob's comments, health care is depressed -- or the health care legislation is depressing health care stock prices. AMERISOURCE BERGEN is a play on logistics. It's a lo jest tickgistics more than anything else. They operate off of very low margins. Operating margins of 1 1/2 mrs% or I think they've shown an ability to grow sales. Last quarter, 9% over the same quarter last year.
“… s. Operating margins of 1 1/2 mrs% or I think they've shown an ability to grow sales. Last quarter, 9% over the same quarter last year. …”
AmeriSource Bergen Corporation (ABC) Discussed on CNBC's Power Lunch
AmeriSource Bergen Corporation is in the news. Find out how this impacts ABC trading on Ockham Research.
Highs, medco, express scripts, cognizant tech, and AMERISOURCE 32 miles per gallon highway. May the best car win.
“… Highs, medco, express scripts, cognizant tech, and AMERISOURCE 32 miles per gallon highway. May the best car win. …”
AmeriSource Bergen Corporation (ABC) Discussed on Fox Business's The Opening Bell on Fox Business
AmeriSource Bergen Corporation is in the news. Find out how this impacts ABC trading on Ockham Research.
Target as well. And downgraded-- they're not sells and that's my mistakes, these are neutrals from buy. All right, so you heard it. And these are buys for real, didn't mess this one up. AMERISOURCE, and an equipment maker and nike, something to watch. Nike, everybody is talking about nike, loving that one and on the sell list, st. Jude's and also, bgx, and those are the names that we're watching as we're seeing commodities move to the upside and the dow jones industrials to the upside and a lot of traders thinking we will have a boost on the last trading day. Brian: let's head back out to the cme group and check in with john brady at mf global. A bit of a selloff. What you were talking about >> a little bit. I think you're probably seeing a little window squaring or window squaring, window dressing excuse and fixed income front pretty well, especially since july I think it is profit taking ahead of friday's employment number, a random event. I think there's window dressing taking place, that's more of an effect on the calendar than anything else. Brian: all right, john brady of mf global. Thank you, appreciate it.
“… e, everybody is talking about nike, loving that one and on the sell list, st. Jude's and also, bgx, and those are the names that we're watching as we're seeing commodities move to the upside and the dow jones industrials to the upside and a lot of traders thinking we will have a boost on the last trading day. Brian: let's head back out to the cme group and check in with john brady at mf global. A bit of a selloff. What you were talking about >> a little bit. I think you're probably seeing a little window squaring or window squaring, window dressing excuse and fixed income front pretty well, especially since july I think it is profit taking ahead of friday's employment number, a random event. I think there's window dressing taking place, that's more of an effect on the calendar than anything else. Brian: all right, john brady of mf global. Thank you, appreciate it. …”
AmeriSource Bergen Corporation (ABC) Discussed on CNBC's Squawk On The Street
AmeriSource Bergen Corporation is in the news. Find out how this impacts ABC trading on Ockham Research.
Handful, up, up about 7% because baker hughes is moving to acquire them. Total price, $5.5 billion. Just one stock hitting a 52-week high this morning. AMERISOURCE BERGEN. >> health care. >> health care distributor. >> don't they -- yeah, I so used to joke about cardinal amerisore bergen. >> right, right. Let's get down to scott wapner. We did sell off there on that >> a bit of a leg lower. The market has come off that down about 97 or so. The market was already poised with a negative biased if you will, over what we saw in china. Down almost 7%. That stock market, the shanghai composite is down about 10% or so over the past three days. Got weakness today and commodity
“… e about cardinal amerisore bergen. >> right, right. Let's get down to scott wapner. We did sell off there on that >> a bit of a leg lower. The market has come off that down about 97 or so. The market was already poised with a negative biased if you will, over what we saw in china. Down almost 7%. That stock market, the shanghai composite is down about 10% or so over the past three days. Got weakness today and commodity …”