In Focus – ABM

To determine whether a company is one of the best stocks to buy now requires a detailed analysis of that company. In our “In Focus” reports we perform a more detailed analysis of one of the roughly 2,000 companies we follow. In this report, we will be covering ABM Industries, Incorporated.

Background

ABM Industries, Incorporated (ABM) is one of the largest facility management service providers in the United States. It provides facility services, including janitorial, parking, security, and engineering services for thousands of commercial, industrial, and governmental facilities. Its business is grouped into four segments: Janitorial, Parking, Security, and Engineering.

The company is headquartered in New York, New York. But it does business across the U.S. and 20 international locations, mostly in Canada.

Stock Fundamentals

ABM Industries has exhibited only modest sales growth over the previous business cycle. In most other ways, this company excels. Its margins are consistently positive. And it scores well on many of our other measures of efficiency.

ABM has a simple and reliable business model that has allowed it to stay dependably profitable and cash flow (and free cash flow) positive. This, in turn, has allowed it to reward its shareholders with at least 16 straight years of rising dividends. We do not mind companies that generate only modest growth if that growth is prudent and profitable. ABM fits the bill.

Furthermore, ABM’s balance sheet is in decent shape. Despite the fact that it tends to have sales volatility and a beta that are below average, it uses relatively little long-term debt; and it has a healthy amount of cash.

On top of all this, ABM is now modestly priced. We like this well-run, reliable, and inexpensive company very much. It currently earns our highest grade for its overall fundamentals, and we consider it one of the best stocks to buy now.

Stat Sheet – ABM Industries, Inc.4/29/16

Ticker ABM
Industry Business Services
Price $ 32.17
Market Cap  $ 1,824
Dividend Yield 2.05
Dividend/CFOp 0.258
Equity/Assets 0.469
Average Equity/Assets 0.453
Financial Strength Average
Growth Prospects Average
Beta 0.87
Price Volatility Below Average
Stock Fundamentals A

(Our assessment of this firm’s fundamentals will be in effect for the rest of calendar year 2016.)

We cover 2,000 companies. If you would like to see more research on some the other companies we also consider the best stocks to buy now, click the link below.

Best Stocks to Buy Now

If you would like to learn why we usually favor the best dividend stocks, click the link below.

Best Dividend Stocks

Disclaimer – Information contained herein has been obtained from sources believed to be reliable. Neither the author nor the publisher guarantees the accuracy or completeness of the information and methods described. This information is offered as general commentary only. It is not intended as investment advice. Investment and trading of securities involves risk, including of loss of capital. Market conditions change over time, and no assurance can be given that a reader may apply the principles described to make a profit. The author and publisher expressly disclaim all and any liability to any person for any investment or trading decisions that the reader may make in reliance on this information.

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In Focus – ABM

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