Alamo Group (ALG)
NYSE:ALG
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Alamo Group
(NYSE:ALG)
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Rating:70Outperform
Price Target:
$181.00
▲(7.61% Upside)
Action:UpgradedDate:03/03/26
The score is driven primarily by a strong financial foundation (especially conservative leverage) offset by a weakening near-term earnings/margin trajectory, supported by bullish technical trends. Valuation is reasonable but not compelling given a moderate P/E and low dividend yield, while earnings-call commentary is constructive long term but acknowledges meaningful near-term pressure in Vegetation Management and gradual recovery.
Positive Factors
Conservative Balance Sheet
Alamo's materially lower leverage and steadily building equity provide durable financial flexibility. Low leverage reduces refinancing risk, supports sustained capital investments, dividends and bolt-on M&A through cyclical downturns, and underpins long-term strategic optionality.
Negative Factors
Vegetation Management Collapse
Severe volume and margin deterioration in Vegetation signal structural demand weakness and operational friction. The division's inverse leverage and integration inefficiencies materially depress company profitability until production, procurement and dealer confidence are restored over several quarters.
Read all positive and negative factors
Positive Factors
Negative Factors
Conservative Balance Sheet
Alamo's materially lower leverage and steadily building equity provide durable financial flexibility. Low leverage reduces refinancing risk, supports sustained capital investments, dividends and bolt-on M&A through cyclical downturns, and underpins long-term strategic optionality.
Read all positive factors
Alamo Group (ALG) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$2.04B
Dividend Yield0.69%
Average Volume (3M)84.52K
Price to Earnings (P/E)19.4
Beta (1Y)0.81
Revenue Growth-2.73%
EPS Growth-2.91%
CountryUS
Employees3,750
SectorIndustrials
Sector Strength72
IndustryAgricultural - Machinery
Share Statistics
EPS (TTM)1.28
Shares Outstanding12,121,294
10 Day Avg. Volume111,508
30 Day Avg. Volume84,518
Financial Highlights & Ratios
PEG Ratio-1.79
Price to Book (P/B)1.76
Price to Sales (P/S)1.26
P/FCF Ratio13.73
Enterprise Value/Market Cap0.96
Enterprise Value/Revenue1.22
Enterprise Value/Gross Profit4.90
Enterprise Value/Ebitda7.85
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusModerate Buy
Number of Analyst Covering1
EPS Forecast (FY)10.41
Revenue Forecast (FY)$1.68B
Alamo Group Business Overview & Revenue Model
Company Description
Alamo Group Inc. designs, manufactures, distributes, and services vegetation management and infrastructure maintenance equipment for governmental, industrial, and agricultural uses worldwide. Its Vegetation Management Division segment offers hydra...
How the Company Makes Money
ALG makes money primarily by manufacturing and selling equipment across its two main operating segments and by supporting that installed base with aftermarket parts and service. (1) New equipment sales: The largest revenue driver is the sale of fi...
Alamo Group Earnings Call Summary
Earnings Call Date:Mar 02, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:May 06, 2026
Earnings Call Sentiment Neutral
The call mixed strong operational and financial positives—particularly in the Industrial Equipment division, healthy liquidity and cash conversion, active M&A, European expansion, and product innovation—against significant near-term challenges in the Vegetation Management division (meaningful revenue and margin decline), one-time restructuring and inventory charges, and a company-wide decline in adjusted EBITDA and EPS. Management presented a clear remediation plan (manufacturing consolidations, procurement initiative, divestitures of non-core product lines) and long-term targets (10% sales growth, ~15% adjusted operating margin, 18%–20% adjusted EBITDA) but expects stabilization to be gradual in 2026.Positive Updates
Industrial Equipment Division Strength
Net sales of $234.9M, up 4.2% year-over-year; adjusted EBITDA $41.5M, 17.7% of net sales (improved from 15.7% in 2024). Net orders for 2025 were up 21% and the division represents 59% of company net sales, with strong double-digit growth in excavator/vacuum and sweeper/safety businesses.
Negative Updates
Overall Revenue Decline
Company net sales for fiscal 2025 were $373.7M, down 3% compared to 2024, reflecting mixed end markets and lower volumes in parts of the business.
Read all updates
Q4-2025 Updates
Positive
Negative
Industrial Equipment Division Strength
Net sales of $234.9M, up 4.2% year-over-year; adjusted EBITDA $41.5M, 17.7% of net sales (improved from 15.7% in 2024). Net orders for 2025 were up 21% and the division represents 59% of company net sales, with strong double-digit growth in excavator/vacuum and sweeper/safety businesses.
Read all positive updates
Company Guidance
Management's guidance emphasized long‑term, through‑the‑cycle targets of 10% sales growth (including acquisitions), adjusted operating margins around 15%, adjusted EBITDA margins of 18%–20%, and free cash flow equal to 100% of net income; near‑term they expect 2026 Industrial end‑markets (ex‑Petersen) to be flattish to low‑/mid‑single‑digit (the Industrial division represented 59% of sales in 2025, was $234.9M, +4.2% y/y, with adjusted EBITDA $41.5M or 17.7%), while Vegetation (41% of sales in 2025, $138.7M, −13.2%, adjusted EBITDA $3.2M or 2.3%) should see sequential Q4→Q1 top‑line and margin improvement but not fully return to Q1‑2025 levels (roughly 8% adjusted operating margin) immediately; they closed Petersen in Jan 2026 (funded with a $120M revolver draw + ~$50M cash, 11/12 of 2026 sales), expect it to be margin‑accretive over time despite near‑term integration investments, and highlighted strong liquidity (cash $309.7M, gross debt $205.7M, pro‑forma credit availability ~$477M), resilient operating cash flow ($177.5M in FY2025) and robust free‑cash‑flow conversion (142% of net income) as supports for M&A and a 13.3% dividend increase to $0.34/quarter.Alamo Group Financial Statement Overview
Summary
Income Statement
68
Positive
Balance Sheet
78
Positive
Cash Flow
61
Positive
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 1.60B | 1.63B | 1.69B | 1.51B | 1.33B |
| Gross Profit | 397.82M | 412.49M | 453.64M | 376.52M | 334.51M |
| EBITDA | 198.02M | 223.26M | 249.19M | 195.36M | 164.51M |
| Net Income | 103.80M | 115.93M | 136.16M | 101.93M | 80.25M |
Balance Sheet | |||||
| Total Assets | 1.61B | 1.45B | 1.41B | 1.31B | 1.21B |
| Cash, Cash Equivalents and Short-Term Investments | 309.66M | 197.27M | 51.92M | 47.02M | 42.12M |
| Total Debt | 220.29M | 226.93M | 240.57M | 306.64M | 274.21M |
| Total Liabilities | 457.91M | 432.02M | 476.62M | 523.15M | 500.08M |
| Stockholders Equity | 1.15B | 1.02B | 932.76M | 785.36M | 705.66M |
Cash Flow | |||||
| Free Cash Flow | 146.92M | 184.78M | 93.41M | -16.77M | 24.36M |
| Operating Cash Flow | 177.54M | 209.78M | 131.15M | 14.53M | 49.67M |
| Investing Cash Flow | -46.19M | -22.18M | -52.62M | -31.74M | -33.44M |
| Financing Cash Flow | -30.79M | -31.97M | -76.88M | 24.45M | -23.00M |
Alamo Group Technical Analysis
Negative
168.20
Price Trends
188.40
Negative
180.17
Negative
193.01
Negative
Market Momentum
-6.01
Negative
42.21
Neutral
55.68
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ALG, the sentiment is Negative. The current price of 168.2 is above the 20-day moving average (MA) of 168.05, below the 50-day MA of 188.40, and below the 200-day MA of 193.01, indicating a neutral trend. The MACD of -6.01 indicates Negative momentum. The RSI at 42.21 is Neutral, neither overbought nor oversold. The STOCH value of 55.68 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for ALG.
Alamo Group Risk Analysis
Alamo Group disclosed 31 risk factors in its most recent earnings report. Alamo Group reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Alamo Group Peers Comparison
UnderperformOutperform
Sector (63)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
70 Outperform | $2.04B | 19.44 | 9.32% | 0.69% | -2.73% | -2.91% | |
67 Neutral | $1.26B | 25.56 | 5.79% | 1.14% | 6.66% | ― | |
67 Neutral | $6.65B | 15.89 | 11.16% | 1.24% | 4.60% | -65.73% | |
63 Neutral | $10.79B | 15.43 | 7.44% | 2.01% | 2.89% | -14.66% | |
63 Neutral | $1.08B | 29.53 | 14.01% | 1.24% | 11.41% | 13.05% | |
52 Neutral | $400.91M | 20.66 | 0.66% | 1.59% | -2.36% | -73.77% |
* Industrials Sector Average
ALG
Alamo Group
168.20
3.47
2.11%
ASTE
Astec
55.06
23.85
76.39%
CMCO
Columbus Mckinnon
13.95
-0.35
-2.43%
LNN
Lindsay
103.02
-15.43
-13.03%
TEX
Terex
58.52
24.80
73.55%
Alamo Group Corporate Events
Business Operations and StrategyM&A Transactions
Alamo Group Completes Strategic Acquisition of Petersen Industries
Positive
Jan 26, 2026
On January 26, 2026, Alamo Group Inc. completed its previously announced acquisition of Petersen Industries, a manufacturer of specialized truck-mounted grapple loader equipment serving municipal and industrial customers, for approximately $166.5 ...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.