AngioDynamics, Inc. – Value Analysis (NASDAQ:ANGO) : October 2, 2017

Capitalcube gives AngioDynamics, Inc. a score of 34.

Our analysis is based on comparing AngioDynamics, Inc. with the following peers – Merit Medical Systems, Inc., LeMaitre Vascular, Inc., C. R. Bard, Inc., Teleflex Incorporated, ICU Medical, Inc., Boston Scientific Corporation and Johnson & Johnson (MMSI-US, LMAT-US, BCR-US, TFX-US, ICUI-US, BSX-US and JNJ-US).

Investment Outlook

AngioDynamics, Inc. has a fundamental score of 34 and has a relative valuation of UNDERVALUED.

Fundamental Score

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Company Overview

  • From a peer analysis angle, relative underperformance over the last year has improved more recently.
  • It trades at a lower Price/Book multiple (1.21) than its peer median (4.74).
  • The market expects faster earnings growth from ANGO-US than from its peers and also a turnaround in its current ROE.
  • ANGO-US has relatively low profit margins and median asset efficiency.
  • Changes in annual earnings (relative to peers) are better than the change in its revenues (relative to peers), implying the company is focused more on earnings.
  • ANGO-US‘s return on assets currently and over the past five years has trailed the peer median and suggests the company might be operationally challenged relative to its peers.
  • The company’s relatively low gross and pre-tax margins suggest a non-differentiated product portfolio and not much control on operating costs relative to peers.
  • While ANGO-US‘s revenues have increased slower than peer median, the market currently gives the company a higher than peer median P/E ratio and may be factoring in some sort of a strategic play.
  • The company’s relatively low level of capital investment and below peer median returns on capital suggest that the company is in maintenance mode.
  • ANGO-US has the financial and operating capacity to borrow quickly.

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Leverage & Liquidity

ANGO-US has the financial and operating capacity to borrow quickly.

  • With debt at a relatively low 15.97% of its enterprise value compared to an overall benchmark of 25% (Note: The peer median is currently 10.30%), and a well-cushioned interest coverage level of 8.88x, ANGO-US can probably borrow quickly. We classify the company as Quick & Able in terms of its capacity to raise additional debt.
  • Of the 7 chosen peers for the company, only 6 of the stocks have an outstanding debt balance. Companies with no debt include LMAT-US.

ANGO-US has maintained its Quick & Able profile from the recent year-end.

  • ANGO-US‘s interest coverage is similar to last year’s high of 8.88x, which compares to a low of 4.26x in 2013.
  • Compared to 2017, interest coverage has remained relatively stable for both the company (8.88x) and the peer median (12.99x).
  • ANGO-US‘s debt-EV is similar to last year’s low of 15.97%, which compares to the 2013 high of 28.50%.
  • Though its debt-EV has remained relatively stable at 15.97% compared to 2017, its peer median has decreased to 10.30% from 11.67% during this period.
  • Relative to peers, debt-EV rose 1.37 percentage points.

Access the detailed analysis for AngioDynamics, Inc.

Key Liquidity Items

Company Debt/Enterprise Value (%) Current Ratio Interest Coverage (x) Cash Flow To Total Debt (%)
Merit Medical Systems, Inc. 11.44 2.57 3.75 30.65
LeMaitre Vascular, Inc. 0 7.25 1166.86 999
C. R. Bard, Inc. 7.05 1.58 17.1 62.86
Teleflex Incorporated 18.73 3.74 6.15 19.44
ICU Medical, Inc. 2.3 4.78 101.25 75.65
Boston Scientific Corporation 13.45 0.75 5.87 17.49
Johnson & Johnson 9.17 1.34 27.52 61.86
AngioDynamics, Inc. 15.97 2.34 8.88 28.37
Peer Median 10.3 2.46 12.99 46.26
Best In Class 2.3 7.25 1166.86 999

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Company Profile

AngioDynamics, Inc. engages in the business of medical devices. Its activities include design, manufactures, and sale of medical, surgical and diagnostic devices. The company focuses on devices in the field of vascular access, peripheral vascular, oncology, and surgery. Its product lines include ablation systems, fluid management systems, vascular access products, angiographic products and accessories, drainage products, thrombolytic products and venous products. AngioDynamics was founded by Eamonn P. Hobbs in 1988 and is headquartered in Latham, NY.

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