Alamo Group (ALG) AI Stock Analysis

• Market Cap: $2.53B
• Dividend Yield: 0.69%
• Average Volume (3M): 84.52K
• Price to Earnings (P/E): 21.7
• Beta (1Y): 0.73
• Revenue Growth: -2.73%
• EPS Growth: -2.91%
• Country: US
• Employees: 3,750
• Sector: Industrials
• Sector Strength: 72
• Industry: Agricultural - Machinery
• EPS (TTM): 2.10
• Shares Outstanding: 12,115,428
• 10 Day Avg. Volume: 111,508
• 30 Day Avg. Volume: 84,518
• PEG Ratio: -1.27
• Price to Book (P/B): 2.19
• Price to Sales (P/S): 1.37
• P/FCF Ratio: 12.04
• Enterprise Value/Market Cap: 0.99
• Enterprise Value/Revenue: 1.56
• Enterprise Value/Gross Profit: 6.23
• Enterprise Value/Ebitda: 11.36
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 70 Outperform
• Price Target: $210.00 ▲(0.82% Upside)

The score is driven primarily by solid financial performance (especially balance sheet strength) and generally positive technical momentum. Offsetting factors include cash flow volatility, mixed earnings-call fundamentals (margin pressure and division weakness), and only moderate valuation support with a low dividend yield.

Positive Factors

Strong balance sheet and declining leverage

A declining debt-to-equity ratio and robust equity ratio indicate durable financial flexibility. This supports capital allocation for acquisitions, R&D, and downturn resilience without stressing liquidity, enabling sustained investment in product lines and distribution over the medium term.

Industrial Equipment division consistent double-digit growth

Sustained double-digit growth in the Industrial Equipment division signals durable end-market demand and competitive product fit. As a repeatable revenue engine, it strengthens recurring aftermarket sales and supports operating leverage, helping stabilize overall company performance over 2–6 months.

Strategic acquisition expanding product portfolio

Closing Petersen adds specialized grapple loader products and municipal/industrial market access, expanding aftermarket parts and service revenue. A strategic, accretive acquisition can bolster scale, cross-sell opportunities, and long-term margin improvement if integration executes as planned.

Negative Factors

Vegetation Management division weakness

A 9% sales decline in Vegetation Management reflects structural exposure to weak tree care and agriculture end markets and production consolidation headwinds. Persistent demand softness or execution gaps in this division can meaningfully drag consolidated growth and margin recovery.

Gross margin pressure from inefficiencies and tariffs

A 90-basis-point margin hit from production inefficiencies and tariffs suggests structural cost challenges. If tariffs persist or manufacturing consolidation lingers, margin recovery will require sustained price realization or permanent cost restructuring, pressuring long-term profitability.

Volatile free cash flow and weaker FCF conversion

Declining and inconsistent free cash flow reduces financial optionality for capex, acquisitions, and shareholder returns. Even with positive operating cash flow, weaker FCF conversion raises funding risk and constrains the company's ability to reliably finance strategic initiatives without raising leverage.

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 hydraulically-powered and tractor-mounted mowers, other cutters and replacement parts for heavy-duty and intensive uses and heavy duty applications, tractor- and truck-mounted mowing and vegetation maintenance equipment, and replacement parts. This segment also provides rotary and finishing mowers, flail and disc mowers, front-end loaders, backhoes, rotary tillers, posthole diggers, scraper blades and replacement parts, zero turn radius mowers, cutting parts, plain and hard-faced replacement tillage tools, disc blades, and fertilizer application components; aftermarket agricultural parts, heavy-duty mechanical rotary mowers, snow blowers, rock removal equipment, replacement parts, tractor attachments, agricultural implements, hydraulic and boom-mounted hedge and grass cutters, tractor attachments and implements, hedgerow cutters, industrial grass mowers, agricultural seedbed preparation cultivators, self-propelled sprayers and multi-drive load-carrying vehicles, cutting blades, and hydraulic and mechanical boom mowers. The company's Industrial Equipment Division segment offers truck-mounted air vacuum, mechanical broom, and regenerative air sweepers, pothole patchers, leaf collection equipment and replacement brooms, parking lot and street sweepers, excavators, catch basin cleaners, and roadway debris vacuum systems, as well as truck-mounted vacuum machines, combination sewer cleaners, and hydro excavators. This segment also offers ice control products, snowplows and heavy duty snow removal equipment, hitches, attachments, and graders; and public works and runway maintenance products, parts, and services, and high pressure cleaning systems and trenchers. The company was founded in 1955 and is headquartered in Seguin, Texas.

How the Company Makes Money

Alamo Group generates revenue primarily through the sale of its manufactured products, which include road maintenance equipment, agricultural machinery, and various attachments. Key revenue streams include direct sales to municipalities for road maintenance and to agricultural businesses for land management. The company also benefits from aftermarket sales, including parts and services for the equipment it sells, which provides a recurring revenue source. Additionally, Alamo Group may engage in strategic partnerships or collaborations with other manufacturers and distributors, enhancing its market reach and operational efficiency. Factors contributing to its earnings include strong demand in the municipal and agricultural sectors, a focus on product innovation, and a growing need for infrastructure maintenance and development.

Alamo Group Financial Statement Overview

Summary

Solid overall fundamentals supported by a strong balance sheet (declining leverage, solid ROE) and stable profitability trends, but tempered by weaker cash flow consistency and a notable TTM free cash flow decline.

Income Statement

Alamo Group shows a stable income statement with consistent revenue growth over the years, although the TTM data indicates a slight decline. The gross profit margin is healthy, and the net profit margin has improved over time, indicating efficient cost management. However, the EBIT and EBITDA margins have slightly decreased in the TTM period, suggesting potential pressure on operational efficiency.

Balance Sheet

The balance sheet reflects a strong financial position with a declining debt-to-equity ratio, indicating reduced leverage and financial risk. The return on equity remains solid, showcasing effective utilization of shareholder funds. The equity ratio is robust, highlighting a strong capital structure. Overall, the balance sheet suggests financial stability and prudent management.

Cash Flow

Cash flow analysis reveals a mixed picture. While operating cash flow remains positive, the free cash flow has experienced fluctuations, with a notable decline in the TTM period. The operating cash flow to net income ratio is healthy, but the free cash flow to net income ratio has decreased, indicating potential challenges in converting profits into free cash flow.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.62B	1.63B	1.69B	1.51B	1.33B	1.16B
Gross Profit	404.60M	412.49M	453.64M	376.52M	334.51M	293.73M
EBITDA	221.74M	223.26M	249.19M	195.36M	164.51M	139.43M
Net Income	116.37M	115.93M	136.16M	101.93M	80.25M	57.80M
Balance Sheet
Total Assets	1.59B	1.45B	1.41B	1.31B	1.21B	1.12B
Cash, Cash Equivalents and Short-Term Investments	244.81M	197.27M	51.92M	47.02M	42.12M	50.20M
Total Debt	209.43M	226.93M	240.57M	306.64M	274.21M	289.07M
Total Liabilities	462.37M	432.02M	476.62M	523.15M	500.08M	486.86M
Stockholders Equity	1.13B	1.02B	932.76M	785.36M	705.66M	635.00M
Cash Flow
Free Cash Flow	149.92M	184.78M	93.41M	-16.77M	24.36M	166.46M
Operating Cash Flow	181.56M	209.78M	131.15M	14.53M	49.67M	184.33M
Investing Cash Flow	-48.02M	-22.18M	-52.62M	-31.74M	-33.44M	-14.17M
Financing Cash Flow	-30.15M	-31.97M	-76.88M	24.45M	-23.00M	-164.24M

Alamo Group Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 208.30
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ALG, the sentiment is Positive. The current price of 208.3 is above the 20-day moving average (MA) of 196.78, above the 50-day MA of 182.82, and above the 200-day MA of 194.86, indicating a bullish trend. The MACD of 7.14 indicates Negative momentum. The RSI at 78.11 is Negative, neither overbought nor oversold. The STOCH value of 89.69 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for ALG.

Alamo Group Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ALG	70 Outperform	$2.53B	21.69	10.82%	0.69%	-2.73%	-2.91%
LNN	70 Outperform	$1.41B	19.94	14.61%	1.24%	11.41%	13.05%
TEX	67 Neutral	$7.48B	19.70	11.26%	1.24%	4.60%	-65.73%
ASTE	66 Neutral	$1.31B	27.47	7.37%	1.14%	6.66%	―
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
CMCO	58 Neutral	$609.13M	102.69	0.44%	1.59%	-2.36%	-73.77%

Alamo Group Corporate Events

Alamo Group Completes Strategic Acquisition of Petersen Industries

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 million on a cash-free, debt-free basis, following the signing of a definitive purchase agreement on December 10, 2025. The deal is intended to reinforce Petersen’s market-leading position and broaden its sales reach by leveraging Alamo’s established distribution channels, signaling a strategic expansion of Alamo’s product portfolio in infrastructure and waste-handling equipment and underscoring its focus on long-term value creation for customers and other stakeholders.

The most recent analyst rating on (ALG) stock is a Buy with a $210.00 price target. To see the full list of analyst forecasts on Alamo Group stock, see the ALG Stock Forecast page.

Alamo Group Announces Acquisition of Petersen Industries

On December 10, 2025, Alamo Group Inc. announced its plan to acquire Petersen Industries, a leader in truck-mounted grapple loader equipment, for approximately $166.5 million. This strategic acquisition, expected to close in the first quarter of 2026, aims to integrate Petersen into Alamo’s Industrial Equipment Division, enhancing its product offerings and market reach. The acquisition is anticipated to be accretive to Alamo Group’s growth and margins, providing solid recurring revenue from aftermarket parts and services, while unlocking significant cost savings and revenue growth opportunities.

The most recent analyst rating on (ALG) stock is a Hold with a $176.00 price target. To see the full list of analyst forecasts on Alamo Group stock, see the ALG Stock Forecast page.

Alamo Group Approves New Deferred Compensation Plan

On November 6, 2025, Alamo Group Inc.’s Board of Directors approved a new Nonqualified Deferred Compensation Plan effective January 1, 2026. This plan allows eligible employees to receive discretionary contributions up to 6% of their base salary and bonus, with full vesting after three years of service. The plan replaces the Supplemental Executive Retirement Plan for new participants, with initial contributions for certain executives based on the present value of their previous plan accounts.

The most recent analyst rating on (ALG) stock is a Hold with a $190.00 price target. To see the full list of analyst forecasts on Alamo Group stock, see the ALG Stock Forecast page.