Atlas Arteria (ALX) AI Stock Analysis

• Market Cap: $7.01B
• Dividend Yield: 8.26%
• Average Volume (3M): 2.65M
• Price to Earnings (P/E): 29.9
• Beta (1Y): 0.62
• Revenue Growth: 9.78%
• EPS Growth: 0.19%
• Country: AU
• Employees: N/A
• Sector: Industrials
• Sector Strength: 72
• Industry: Industrial - Infrastructure Operations
• EPS (TTM): 0.07
• Shares Outstanding: 1,450,833,700
• 10 Day Avg. Volume: 1,765,956
• 30 Day Avg. Volume: 2,652,046
• PEG Ratio: 4.51
• Price to Book (P/B): 2.06
• Price to Sales (P/S): 47.53
• P/FCF Ratio: 74.83
• Enterprise Value/Market Cap: 1.25
• Enterprise Value/Revenue: 77.02
• Enterprise Value/Gross Profit: 214.95
• Enterprise Value/Ebitda: 124.79
• 1Y Price Target: $5.49
• Price Target Upside: 13.37% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 5
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 64 Neutral
• Price Target: AU$5.00 ▲(3.31% Upside)

The overall stock score of 63.6 reflects a combination of strong financial performance in revenue growth and gross profitability, offset by challenges in cash flow stability and EBIT performance. Technical analysis suggests a neutral to slightly bearish outlook, while the high dividend yield provides some valuation appeal despite a high P/E ratio.

Positive Factors

Revenue Growth

The company's solid revenue growth indicates a robust business model and effective management of toll road assets, supporting long-term financial health.

Gross Profit Margin

A high gross profit margin reflects strong operational efficiency, which can lead to sustainable profitability and competitive advantage in the infrastructure sector.

Balanced Capital Structure

A moderate debt-to-equity ratio indicates financial stability, allowing the company to leverage growth opportunities while maintaining manageable risk levels.

Negative Factors

EBIT Performance

Weak EBIT performance suggests inefficiencies in operational profitability, which could hinder the company's ability to reinvest in growth and maintain competitive positioning.

Cash Flow Stability

A substantial decline in free cash flow raises concerns about the company's ability to fund operations and investments, potentially impacting long-term financial flexibility.

Return on Equity

A relatively low ROE indicates that the company may not be effectively utilizing its equity base to generate returns, which could affect investor confidence and capital allocation.

Atlas Arteria Business Overview & Revenue Model

Company Description

Atlas Arteria Limited owns, develops, and operates toll roads. It holds a 13.4% interest in 22-kilometer toll road investors partnership II (TRIP II), the concessionaire for Dulles Greenway toll road located in Virginia, the United States. The company was formerly known as Macquarie Atlas Roads Limited and changed its name to Atlas Arteria Limited in May 2018. Atlas Arteria Limited was incorporated in 2009 and is based in Melbourne, Australia.

How the Company Makes Money

Atlas Arteria generates revenue primarily through the collection of tolls from the vehicles that use its managed road networks. This revenue model is underpinned by long-term concession agreements that grant the company the rights to operate and maintain these toll roads for extended periods. Key revenue streams include direct toll collections, which are influenced by traffic volume and toll rates, as well as ancillary revenue from services related to the road infrastructure, such as advertising and service areas. The company also benefits from partnerships with local governments and other stakeholders that enhance its operational capabilities and expand its asset base, contributing to its overall earnings.

Atlas Arteria Financial Statement Overview

Summary

Atlas Arteria shows strong revenue growth and gross profitability, with a high gross profit margin of 95.7%. However, challenges in EBIT performance and a significant drop in free cash flow from $712.8 million to $92.1 million raise concerns about cash flow stability. The balance sheet is stable with moderate leverage, but there is room for improvement in shareholder returns.

Income Statement

Atlas Arteria shows a solid performance in revenue growth, with a notable increase from $134 million to $145 million. The company maintains a high gross profit margin of 95.7%, indicating strong operational efficiency. However, the lack of EBIT suggests areas for improvement in operational profitability. EBITDA margin remains robust at over 306%, reflecting strong cash generation capabilities despite EBIT challenges.

Balance Sheet

The balance sheet presents a mixed picture with a healthy equity base of $3.34 billion, leading to an equity ratio of 40.4%. The debt-to-equity ratio of 0.55 is moderate, suggesting a balanced capital structure. However, ROE of 10.1% could be improved to enhance shareholder returns. The company's leverage and equity position are stable but warrant attention for future growth.

Cash Flow

Cash flow analysis reveals a significant drop in free cash flow from $712.8 million to $92.1 million, posing concerns over cash sustainability. Operating cash flow to net income ratio is unavailable, limiting insights into core cash generation. However, the company has positive free cash flow, indicating some level of financial flexibility. Improving cash flow consistency will be crucial.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	114.15M	145.00M	134.00M	118.24M	100.52M	104.56M
Gross Profit	40.90M	138.70M	16.40M	116.00K	-9.05M	-13.55M
EBITDA	70.45M	106.30M	425.70M	63.07M	-11.95M	-93.68M
Net Income	214.70M	335.90M	323.50M	266.96M	163.70M	-99.21M
Balance Sheet
Total Assets	7.96B	8.26B	8.04B	8.33B	5.22B	5.27B
Cash, Cash Equivalents and Short-Term Investments	290.40M	351.50M	305.30M	521.66M	229.39M	260.34M
Total Debt	1.70B	1.85B	1.72B	1.74B	1.65B	1.55B
Total Liabilities	1.84B	1.95B	1.81B	1.84B	1.72B	1.63B
Stockholders Equity	6.12B	3.34B	6.24B	6.49B	3.50B	3.63B
Cash Flow
Free Cash Flow	430.55M	92.10M	712.80M	473.14M	38.56M	24.00M
Operating Cash Flow	431.45M	93.20M	84.70M	473.50M	40.03M	25.44M
Investing Cash Flow	-1.20M	633.00M	631.70M	-3.01B	304.05M	-976.67M
Financing Cash Flow	-680.20M	-683.80M	-682.10M	2.58B	-374.71M	-232.73M

Atlas Arteria Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 4.84
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AU:ALX, the sentiment is Negative. The current price of 4.84 is below the 20-day moving average (MA) of 4.98, below the 50-day MA of 4.91, and below the 200-day MA of 4.93, indicating a bearish trend. The MACD of -0.02 indicates Positive momentum. The RSI at 38.37 is Neutral, neither overbought nor oversold. The STOCH value of 1.96 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for AU:ALX.

Atlas Arteria Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
DBI	71 Outperform	AU$2.17B	24.65	8.17%	5.18%	13.19%	14.79%
ALX	64 Neutral	$7.01B	29.89	3.78%	8.26%	9.78%	0.19%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
QUB	62 Neutral	€7.64B	67.50	3.82%	2.09%	28.47%	-50.19%
AZJ	60 Neutral	$6.28B	21.19	7.03%	4.40%	3.01%	-23.84%
KLS	58 Neutral	AU$1.30B	23.81	5.78%	3.97%	9.52%	-8.76%
TCL	52 Neutral	$46.69B	350.23	1.24%	4.35%	-4.30%	-59.47%

Atlas Arteria Corporate Events

Atlas Arteria Reports Q3 Revenue Growth and Leadership Update

Atlas Arteria reported a 10.9% increase in toll revenue for Q3 2025 compared to the previous year, driven by strong traffic growth across its portfolio and favorable foreign exchange movements. The company also announced the appointment of Kara Lawrence as CEO of Dulles Greenway, bringing significant leadership experience to the role. This leadership change and revenue growth position Atlas Arteria favorably in the market, potentially benefiting stakeholders through improved operational efficiency and strategic leadership.

Atlas Arteria Announces Cessation of Performance Rights

Atlas Arteria announced the cessation of 24,464 performance rights due to the lapse of conditional rights, as the conditions were not met or became incapable of being satisfied. This announcement may impact the company’s financial operations and stakeholder interests by potentially affecting employee incentives tied to performance rights.

Atlas Arteria Secures US$325 Million in Notes for Chicago Skyway

Atlas Arteria announced that Chicago Skyway has successfully priced US$325 million in notes through the US Private Placement market, divided into two tranches with maturities in 2038 and 2041. This transaction, which will not increase incremental debt, aims to repay existing notes maturing in February 2026, thereby strengthening Chicago Skyway’s balance sheet and extending its average debt maturity, while maintaining its S&P credit rating at BBB.

Atlas Arteria Issues Performance Rights Under Employee Incentive Scheme

Atlas Arteria has announced the issuance of 32,214 performance rights as part of an employee incentive scheme. These securities are unquoted and are not intended to be listed on the ASX, reflecting the company’s ongoing efforts to incentivize and retain key personnel, potentially impacting its operational efficiency and stakeholder engagement.

Atlas Arteria Director Increases Stake in Company

Atlas Arteria has announced a change in the director’s interest, with Ken Daley, a director of Atlas Arteria Limited, acquiring an additional 4,000 ALX ordinary stapled securities through an on-market trade. This acquisition increases his total holdings to 24,000 securities, reflecting a strategic move that could signal confidence in the company’s future performance and potentially impact stakeholder perceptions.

Atlas Arteria Announces H1 2025 Distribution

Atlas Arteria announced a distribution of 20.0 Australian cents per stapled security for the first half of 2025, with payments expected to be made in early October. This distribution reflects the company’s ongoing commitment to providing value to its stakeholders and maintaining its position in the toll road industry.

Atlas Arteria Declares New Dividend Distribution

Atlas Arteria has announced a new dividend distribution of AUD 0.20 per share, related to the six-month period ending June 30, 2025. The ex-dividend date is set for September 24, 2025, with a record date of September 25, 2025, and payment scheduled for October 7, 2025. This announcement reflects the company’s ongoing commitment to returning value to its shareholders and may influence investor sentiment positively.

Atlas Arteria Announces Issuance of Unquoted Securities

Atlas Arteria has announced the issuance and conversion of 22,879 unquoted equity securities, effective from September 5, 2025. This move signifies a strategic financial adjustment potentially impacting the company’s capital structure and market positioning, reflecting its ongoing efforts to optimize shareholder value and operational efficiency.

Atlas Arteria Announces Director’s Interest Change

Atlas Arteria has announced a change in the director’s interest notice, specifically regarding Hugh Wehby, a director of ATLAX. The change involves the vesting of restricted stapled securities and rights under the company’s incentive plans, which were initially granted to compensate Mr. Wehby for forfeiting incentives from his previous employer. This adjustment reflects the company’s ongoing commitment to aligning its leadership’s interests with its strategic goals, potentially impacting its operational focus and stakeholder relations.