Fact based stock research
Armstrong World Industries (NYSE:AWI)

US04247X1028

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For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".

Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".

Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.

Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.

(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).

(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.

Armstrong World Industries stock research in summary

armstrongceilings.com

ANALYSIS: With an Obermatt Combined Rank of 18 (worse than 82% compared with investment alternatives), Armstrong World Industries (Building Products, USA) shares have lower financial characteristics compared with similar stocks. Shares of Armstrong World Industries are low in value (priced high) with a consolidated Value Rank of 21 (worse than 79% of alternatives), and are riskily financed (Safety Rank of 8, which means above-average debt burdens) but show above-average growth (Growth Rank of 77). ...read more

RECOMMENDATION: A Combined Rank of 18, is a sell recommendation based on Armstrong World Industries's financial characteristics. As the company Armstrong World Industries shows low value with an Obermatt Value Rank of 21 (79% of comparable investments are less expensive), investors should look at the other ranks. In this case, growth is expected to be above-average, better than 77% of comparable companies (Obermatt Growth Rank is 77). This is a typical case. Companies with above average growth tend to cost more than stocks with slower growth expectations. If this is a high-growth company, the low Obermatt Safety Rank of 8 is a good sign. The more debt a well-performing company has, the higher the returns to shareholders. However, if growth turns negative or interest rates increase, high debt may become a burden. If you believe the future is bright for Armstrong World Industries, even a low-value company (in terms of its key financial indicators) can be a good investment. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more

Latest Obermatt Ranks


360° View^new
Sentiment Rank^new
Value Rank	21
Growth Rank	77
Safety Rank	8
Combined Rank	18

Country	USA
Industry	Building Products
Index	Dividends USA
Size class	Large

14-Nov-2024. Stock data may be delayed. Log in or sign up to get the most recent research.

Further information

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Review the performance ranks of the individual metrics that form each investment strategy.

Research History: Armstrong World Industries

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	17	31	41	21
GROWTH
GROWTH	54	95	19	77
SAFETY
SAFETY	15	46	1	8
SENTIMENT
SENTIMENT	n/a	21	38	^new
360° VIEW
360° VIEW	n/a	47	4	^new

Most recent update of the stock research: 14-Nov-2024. Financial reporting date used for calculating ranks: 30-Jun-2024. Stock research history is based on the Obermatt Method. The higher the rank, the better Armstrong World Industries is in the corresponding investment strategy.
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Combined financial peformance in Detail

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	17	31	41	21
GROWTH
GROWTH	54	95	19	77
SAFETY
SAFETY	15	46	1	8
COMBINED
COMBINED	20	71	1	18

Last update of combined financial performance: 14-Nov-2024. Stock analysis on combined financial performance: The higher the rank of Armstrong World Industries the better the performance.

Value Metrics in Detail

ANALYSIS: With an Obermatt Value Rank of 21 (worse than 79% compared with alternatives), Armstrong World Industries shares are significantly more expensive than comparable stocks. The Value Rank is based on consolidating four value indicators, with three out of four indicators below average for Armstrong World Industries. Only the metric dividend yield has an above-average rank, reflecting that dividend practices are expected to be higher than 71% of comparable companies, making the stock an attractive buy for dividend investors. However, dividend investors may get disappointed because all other critical financial indicators are below the market median: Price-to-Sales is 13 which means that the stock price compared with what market professionals expect for future profits is higher than 87% of comparable companies, indicating a low value concerning Armstrong World Industries's sales levels. The same is valid for Price-to-Profit (also referred to as price-earnings, P/E) with a rank of 37 which means that the stock price compared with what market professionals expect for future profit levels is higher than 63% of comparable companies. In addition, Price-to-Book (also referred to as market-to-book ratio) with a Price-to-Book Rank of 9 is also low. Compared with invested capital, the stock price is higher than for 91% of comparable investments. ...read more

RECOMMENDATION: The overall picture with a consolidated Value Rank of 21, is a sell recommendation based on Armstrong World Industries's stock price compared with the company's operational size and dividend yields. Should dividend investors pick Armstrong World Industries? The company-reported financials speak against it. The company is expensive compared with revenue and invested capital levels, two reliable company size indicators. In addition, it currently has a low level of profits. How can future dividends be paid in the case that profits remain low? Dividend investors should choose Armstrong World Industries only if they reasonably expect the low current profit levels to be transitory. We recommend further analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks, including the 360° View, before making an investment decision, which is essential in this case, as the financial indicators are inconclusive. ...read more

VALUE METRICS	2021	2022	2023	2024
PRICE VS. REVENUES (P/S)
PRICE VS. REVENUES (P/S)	12	16	17	13
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)	46	41	52	37
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)	1	10	13	9
DIVIDEND YIELD
DIVIDEND YIELD	48	85	80	71
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE	17	31	41	21

Last update of Value Rank: 14-Nov-2024. Stock analysis on value ratios: The higher the rank, the lower the value ratio of Armstrong World Industries; except for dividend yield where the rank is higher, the higher the yield.

Growth Metrics in Detail

ANALYSIS: With an Obermatt Growth Rank of 77 (better than 77% compared with alternatives) for 2024, Armstrong World Industries shows one of the highest growth dynamics in its industry. Investors also speak of high momentum. The Growth Rank is based on consolidating four value indicators, with all but one indicator above average for Armstrong World Industries. Sales Growth has a rank of 60 which means that currently, professionals expect the company to grow more than 60% of its competitors. Both Profit Growth, with a rank of 61, and Stock Returns, with a rank of 87, are also above average. But Capital Growth only has a rank of 41, which means that, currently, professionals expect the company to grow its invested capital less than 59% of its competitors. ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 77, is a buy recommendation for growth and momentum investors. That may be a good sign if the company is already well positioned and doesn't require more investments at this time. They may focus on growing the top (revenues) and bottom (profits) lines, recently rewarded with above-average stock returns for shareholders. But it may also be a sign of danger as the company is falling back with capital investment activities concerning competition. This requires further analysis of corporate communications. While momentum is a popular investment factor, the value aspect might be the more important one, in the longer term. We recommend analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks to arrive at a 360° View of the stock purchase case. ...read more

GROWTH METRICS	2021	2022	2023	2024
REVENUE GROWTH
REVENUE GROWTH	46	63	29	60
PROFIT GROWTH
PROFIT GROWTH	67	42	39	61
CAPITAL GROWTH
CAPITAL GROWTH	n/a	87	31	41
STOCK RETURNS
STOCK RETURNS	80	83	61	87
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH	54	95	19	77

Last update of Growth Rank: 14-Nov-2024. Stock analysis on growth metrics: The higher the rank, the higher the growth and returns of Armstrong World Industries.

Safety Metrics in Detail

ANALYSIS: With an Obermatt Safety Rank of 8 (better than 8% compared with alternatives), the company Armstrong World Industries has much riskier financing practices than comparable other companies, which means that their overall debt burden is significantly above the industry average. This doesn't mean that the business of Armstrong World Industries is also risky, it only means that the company is on the riskier side in respect to bankruptcy in case things turn sour, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with just one indicator above average for Armstrong World Industries. Liquidity is at 55, meaning the company generates more profit to service its debt than 55% of its competitors. This indicates that the company is safer when it comes to debt service. But Refinancing is riskier at a rank of 7, which means that the portion of the debt that is about to be refinanced is above average. It has more debt in the refinancing stage than 93% of its competitors. Leverage is also high at a rank of 16, which means that the company has an above-average debt-to-equity ratio. It has more debt than 84% of its competitors. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 8 (worse than 92% compared with alternatives), Armstrong World Industries has a financing structure that is significantly riskier than that of its competitors. High Leverage (a low Obermatt Leverage Rank) is good in good times, because it usually indicates that shareholders get higher returns. The good Liquidity performance of the company is an indicator that this is the case. However, if you expect an economic downturn, you may stay clear of this stock because they have an above-average debt level that needs refinancing soon. If the company is sailing with good winds, as may be visible from the Growth and Sentiment performance, the refinancing risk may be lower than the low Refinancing rank suggests. ...read more

SAFETY METRICS	2021	2022	2023	2024
LEVERAGE
LEVERAGE	50	14	10	16
REFINANCING
REFINANCING	22	100	7	7
LIQUIDITY
LIQUIDITY	37	42	47	55
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY	15	46	1	8

Last update of Safety Rank: 14-Nov-2024. Stock analysis on safety metrics: The higher the rank, the lower the leverage of Armstrong World Industries and the more cash is available to service its debt.

Sentiment Metrics in Detail

SENTIMENT	2021	2022	2023	2024
ANALYST OPINIONS
ANALYST OPINIONS	n/a	20	15	^new
OPINIONS CHANGE
OPINIONS CHANGE	n/a	9	50	^new
PRO HOLDINGS
PRO HOLDINGS	n/a	85	88	^new
MARKET PULSE
MARKET PULSE	n/a	36	45	^new
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT	n/a	21	38	^new

Last update of Sentiment Rank: 14-Nov-2024. Stock analysis on sentiment metrics: The higher the rank, the more positive the sentiment for Armstrong World Industries.
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