ABM · sample dossier
ABM Industries, Inc.
54/100
OutdatedGenerated Sep 5, 2026 · 10:00 AM UTC · 62 days ago
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EquityABM Industries, Inc. · XNYS
Decision context
Recommendation
Balanced between solid Value (84/100) and constrained Quality (29/100).
A mixed picture — no strong reason to buy or sell right now.
AlphaDog Fair Value
Executive thesis & key metrics
Executive Investment Thesis
ABM Industries, Inc. is a facility services provider with a $2.76B market cap trading at a P/E of 18.17 and EV/EBITDA of 10.51. The Hold verdict reflects revenue growth of 8.4% YoY and EPS growth of 9.0% YoY offset by a narrow net margin of 1.8% and ROA of 3.8%. The single biggest risk is the lack of margin buffer against cost inflation given a Debt/Equity ratio of 1.13 and an Altman Z-Score of 2.96.
Key Metrics to Watch
What changed recently
No material changes found in the last 30 days.
Why this rating
Score 54 · Hold
Data through
OutdatedApr 30, 2026
Value 84/100 — P/E 18.2x screens cheap vs inputs.
Re-evaluate if
- Net margin falls below 1.4% (was 1.8%)
- Debt/Equity rises above 1.13.
Trim / reconsider if
- ROA falls below 2.5% (was 3.8%)
Think of these dollars as a map of our value estimate for Hold — helpful context, not a reason to override the view.
A Calmer Look · Devil's Advocate
The consensus Hold verdict dangerously understates downside risk by treating ABM's trailing free cash flow of $4.85 per share as an unbreakable defensive floor.
May be overlooked
Severe margin fragility
A 1.8% net margin on 12.9% gross margin creates extreme sensitivity to unhedged labor inflation, where a minor operating cost escalation turns the entire business unprofitable.
Stale quarterly reporting
Consensus extrapolates operational stability from the 2026-06-05 Form 10-Q and April 30, 2026 balance sheet data, which are now over 90 days stale as of 2026-09-05.
Debt burden relative to return capacity
An ROA of 3.8% paired with a Debt/Equity ratio of 1.13 leaves negligible cushion for debt servicing if facility service contract renewals face pushback.
Expectations look stretched
Over-reliance on trailing free cash flow
Extrapolating $4.85 FCF per share assumes working capital dynamics remain permanently favorable despite historical volatility in contract-based billing.
Premium multiple for commoditized services
A P/E of 18.2 and EV/EBITDA of 10.5 are inflated for a contracting business with 1-year total price returns of -2.2%.
Ignoring technical rollover
Treating the stock as technically sound simply because it trades above its 50-day and 200-day moving averages overlooks the fresh 1-month decline of -3.1%.
Gross margin falls below 12.9%.
Gross margin falls below 12.9%.
Market context
Snapshot returns at report publication
1 month
-3.1%
3 months
+10.6%
6 months
+7.3%
1 year
-2.2%
At a Glance
A mid-sized company is on a steady trend at fair pricing.
Top Holders
Financial trajectory
Financial Performance
Go deeper
For learning and research only — not investment advice. AlphaDog doesn’t hold stocks and isn’t your financial advisor.
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