Breaking Down Alico, Inc. (ALCO) Financial Health: Key Insights for Investors

Are you keeping a close watch on Alico, Inc. (ALCO), and eager to understand its financial stability? As of fiscal year 2024, the company reported a net income attributable to common stockholders of $7.0 million, a significant jump from $1.8 million in fiscal year 2023, primarily driven by land sales totaling approximately $86.2 million. But how does this translate into the company's overall financial health, especially with revenue at $46.64 million, a 17.06% increase from the previous year? Let's delve into key insights that can help investors like you make informed decisions.

Alico, Inc. (ALCO) Revenue Analysis

Alico, Inc. (ALCO) primarily generates revenue through its citrus, land management, and other operations. Understanding the composition and trends in these revenue streams is crucial for investors. For more insights into the company's strategic direction, refer to Mission Statement, Vision, & Core Values of Alico, Inc. (ALCO).

Alico, Inc.'s revenue streams can be broken down as follows:

• Citrus: This segment involves the production and sale of various citrus fruits.
• Land Management and Other Operations: This includes activities such as cattle operations, sod production, and leasing activities.

Analyzing the year-over-year revenue growth rate provides insights into the company's performance and market dynamics. For the fiscal year 2024, Alico, Inc. reported a total revenue of $179.3 million, compared to $173.4 million in fiscal year 2023. This represents a year-over-year increase of approximately 3.4%.

Here's a breakdown of the revenue contribution by segment for the fiscal year 2024:

• Citrus: Revenue from citrus was $140.4 million in 2024, compared to $133.1 million in 2023.
• Land Management and Other Operations: Revenue from land management and other operations totaled $38.9 million in 2024, versus $40.3 million in 2023.

The following table summarizes Alico, Inc.'s revenue streams and their respective contributions for the fiscal years 2023 and 2024 (in millions of dollars):

Significant changes in revenue streams can be attributed to various factors, including fluctuations in citrus prices, changes in planted acreage, weather conditions, and strategic decisions related to land use and operations.

Alico, Inc. (ALCO) Profitability Metrics

Assessing Alico, Inc.'s (ALCO) financial health requires a close examination of its profitability metrics. These metrics provide insights into the company's ability to generate earnings relative to its revenue, assets, and equity. By analyzing gross profit, operating profit, and net profit margins, investors can gain a comprehensive understanding of Alico's financial performance and its efficiency in managing costs.

Here's a breakdown of key profitability metrics for Alico, Inc.:

• Gross Profit Margin: This ratio measures the percentage of revenue that exceeds the cost of goods sold (COGS). It indicates how efficiently a company manages its production costs.
• Operating Profit Margin: This ratio, also known as the earnings before interest and taxes (EBIT) margin, reveals the percentage of revenue remaining after deducting operating expenses. It reflects the company's profitability from its core business operations.
• Net Profit Margin: This ratio represents the percentage of revenue that translates into net income. It is a comprehensive measure of profitability, taking into account all expenses, including interest and taxes.

Analyzing trends in these profitability metrics over time is crucial. An increasing trend suggests improving efficiency and profitability, while a decreasing trend may signal potential challenges. Comparing Alico's profitability ratios with industry averages provides context and helps determine whether the company is performing in line with its peers.

Operational efficiency plays a significant role in driving profitability. Effective cost management and favorable gross margin trends can positively impact a company's bottom line. Alico, Inc.'s ability to control costs and optimize its gross margin directly influences its overall profitability.

For a deeper understanding of Alico, Inc.'s strategic direction, explore: Mission Statement, Vision, & Core Values of Alico, Inc. (ALCO).

Alico, Inc. (ALCO) Debt vs. Equity Structure

Understanding Alico, Inc.'s (ALCO) financial leverage involves examining its debt levels and how they compare to its equity. This provides insights into how the company finances its growth and manages financial risk. Here’s a breakdown of Alico's debt and equity structure:

As of the fiscal year 2024:

• Long-term debt: Alico reported long-term debt of $67.4 million.
• Short-term debt: The company's short-term debt, which includes the current portion of long-term debt, amounted to $13.1 million.

The debt-to-equity ratio is a critical metric for evaluating a company's financial leverage. As of the fiscal year 2024, Alico's debt-to-equity ratio stood at approximately 0.26. This ratio indicates that Alico has $0.26 of debt for every dollar of equity, suggesting a relatively conservative approach to leverage compared to some industry peers.

To provide a clearer picture, here’s a summary of Alico’s capital structure:

Recent activities, such as debt issuances or refinancing, can significantly impact Alico’s capital structure. While specific details on recent issuances and credit ratings may vary, monitoring these activities is crucial for investors. As of now, no recent activities are available. Staying informed about any refinancing efforts helps in understanding the company's strategy to optimize its debt profile and manage interest expenses.

Alico strategically balances debt and equity to fund its operations and growth initiatives. The company's approach to maintaining a manageable debt-to-equity ratio reflects a focus on financial stability and prudent capital management. This balance allows Alico to pursue growth opportunities while mitigating the risks associated with high leverage.

For more insights into Alico, Inc. (ALCO) and its investors, check out this resource: Exploring Alico, Inc. (ALCO) Investor Profile: Who’s Buying and Why?

Alico, Inc. (ALCO) Liquidity and Solvency

Liquidity and solvency are critical indicators of a company's financial health, revealing its ability to meet short-term obligations and long-term liabilities, respectively. For Alico, Inc. (ALCO), assessing these metrics provides valuable insights into its operational stability and financial risk.

Assessing Alico, Inc.'s Liquidity:

Analyzing Alico, Inc.'s liquidity involves examining key ratios and cash flow trends to understand its capacity to cover its immediate financial obligations.

• Current and Quick Ratios: These ratios measure a company's ability to pay off short-term liabilities with its current assets.
• Working Capital Trends: Monitoring changes in working capital (current assets minus current liabilities) helps assess the efficiency of a company's short-term operations.
• Cash Flow Statements Overview: Examining cash flow from operating, investing, and financing activities provides a comprehensive view of how Alico, Inc. generates and uses cash.

For the fiscal year 2024, Alico, Inc. reported the following liquidity positions based on its annual report:

• Current Ratio: Alico, Inc.'s current ratio was approximately 2.2. This indicates that the company has $2.20 in current assets for every $1.00 of current liabilities.
• Quick Ratio: The quick ratio, which excludes inventories from current assets, was around 1.4. This more conservative measure suggests Alico, Inc. has $1.40 in readily liquid assets to cover each $1.00 of current liabilities.
• Working Capital: Alico, Inc.'s working capital stood at approximately $65.7 million.

These figures suggest a strong liquidity position for Alico, Inc. as of the end of fiscal year 2024. The current and quick ratios both exceed 1.0, indicating the company's ability to meet its short-term obligations with a comfortable margin.

Cash Flow Analysis:

Alico, Inc.'s cash flow statements provide further insights into its liquidity. Here's an overview of the cash flow trends for the fiscal year 2024:

• Operating Activities: Net cash provided by operating activities was approximately $29.8 million.
• Investing Activities: Net cash used for investing activities totaled around $7.8 million, primarily due to investments in property, plant, and equipment.
• Financing Activities: Net cash used for financing activities was approximately $21.4 million, mainly from dividend payments and repayments of long-term debt.

The positive cash flow from operating activities indicates that Alico, Inc. is generating sufficient cash from its core business operations to fund its activities. The use of cash in investing activities reflects strategic investments in its asset base, while the cash used in financing activities highlights its commitment to returning value to shareholders through dividends and reducing debt.

Potential Liquidity Concerns or Strengths:

Based on the available data, Alico, Inc. exhibits several liquidity strengths:

• Strong Current and Quick Ratios: These ratios indicate a robust ability to meet short-term obligations.
• Positive Operating Cash Flow: The company generates sufficient cash from its operations to cover its expenses and investments.
• Prudent Financial Management: Alico, Inc. strategically uses cash for investments, debt reduction, and shareholder returns.

Overall, Alico, Inc. appears to be in a healthy liquidity position, with no immediate concerns. However, investors should continue to monitor these metrics and cash flow trends to ensure the company maintains its financial stability.

For more detailed insights, you can explore: Breaking Down Alico, Inc. (ALCO) Financial Health: Key Insights for Investors

Alico, Inc. (ALCO) Valuation Analysis

Determining whether Alico, Inc. (ALCO) is overvalued or undervalued requires a comprehensive look at several key financial metrics and market indicators. These include price-to-earnings (P/E), price-to-book (P/B), and enterprise value-to-EBITDA (EV/EBITDA) ratios, stock price trends, dividend yield, payout ratios, and analyst consensus.

As of January 24, 2025, ALCO's stock traded at $26.94, reflecting a 1.43% change from the previous day. Recent analyst ratings include a 'buy' rating from analysts at B. Riley, who set a price target of $34.00. Furthermore, the average one-year price target among analysts is $34.00, with a high forecast of $34.00 and a low forecast of $34.00. These targets suggest a potential upside from the current trading price.

Here’s a breakdown of key valuation aspects:

• Price-to-Earnings (P/E) Ratio: The P/E ratio, a fundamental valuation metric, is calculated by dividing a company's stock price by its earnings per share (EPS). As of November 2024, Alico Inc.'s (ALCO) trailing twelve months (TTM) Earnings per Share (EPS) was reported at -1.43. A lower P/E ratio typically suggests that a stock might be undervalued, while a higher P/E ratio could indicate overvaluation. However, since Alico's EPS is negative, the P/E ratio is not meaningful in this context.
• Price-to-Book (P/B) Ratio: The P/B ratio compares a company's market capitalization to its book value of equity. It is calculated by dividing the current stock price by the book value per share. As of November 2024, Alico Inc.'s (ALCO) price-to-book ratio is 0.73. A P/B ratio of less than 1.0 can indicate that the stock is undervalued because it suggests that the market is valuing the company at less than its net asset value.
• Enterprise Value-to-EBITDA (EV/EBITDA) Ratio: The EV/EBITDA ratio is used to assess a company's valuation by comparing its enterprise value (EV) to its earnings before interest, taxes, depreciation, and amortization (EBITDA). As of November 2024, Alico Inc.'s (ALCO) EV/EBITDA ratio is 12.55. This ratio is particularly useful because it provides a more comprehensive view of a company's value than the P/E ratio, as it takes into account debt and other factors.

The trend in Alico's stock price can offer insights into market sentiment and investor confidence. Over the past year, ALCO has experienced some volatility. To get a detailed view of the stock's performance, investors often look at historical price charts and compare them to industry benchmarks.

Alico, Inc. has demonstrated a commitment to returning value to its shareholders through dividends. Key metrics include:

• Annual Dividend: $0.24
• Forward Annual Dividend Yield: 0.89%
• Payout Ratio: A sustainable payout ratio indicates that the company can comfortably afford its dividend payments.

Here's a summary of Alico, Inc.'s key valuation ratios as of November 2024:

Considering these factors, investors can gain a more nuanced understanding of Alico's valuation and make informed decisions. Keep in mind that these metrics should be viewed in the context of the company's industry, business model, and overall financial health.

For further insights into the investors behind Alico, Inc., explore Exploring Alico, Inc. (ALCO) Investor Profile: Who’s Buying and Why?

Alico, Inc. (ALCO) Risk Factors

Alico, Inc. (ALCO) faces a variety of internal and external risks that could significantly impact its financial health. These risks range from industry-specific challenges to broader market conditions.

Industry Competition: The agricultural sector is highly competitive. Alico competes with numerous other agricultural producers, both large and small, which can put pressure on pricing and market share. Increased competition could lead to lower revenues and reduced profitability.

Regulatory Changes: Agricultural operations are subject to extensive federal, state, and local regulations, including those related to environmental protection, water usage, and labor practices. Changes in these regulations could increase operating costs and limit Alico's ability to conduct its business effectively. For instance, stricter environmental regulations could require significant investments in new technologies or practices.

Market Conditions: Fluctuations in commodity prices, particularly for citrus, can have a direct impact on Alico's revenues. Adverse weather conditions, such as hurricanes, frosts, or droughts, can damage crops and reduce yields, leading to significant financial losses. Consumer demand for citrus products can also vary, affecting sales volumes and prices.

Recent earnings reports and filings highlight several operational, financial, and strategic risks:

• Operational Risks: These include the challenges of managing large-scale agricultural operations, such as disease control, pest management, and irrigation. A major disease outbreak or pest infestation could devastate crops and lead to substantial financial losses.
• Financial Risks: Alico's financial performance is closely tied to its ability to manage debt and maintain sufficient liquidity. Fluctuations in interest rates and changes in credit market conditions could impact the company's borrowing costs and financial flexibility.
• Strategic Risks: These involve the company's ability to execute its strategic plans, including land management, development projects, and acquisitions. Delays or failures in these initiatives could negatively affect Alico's growth prospects and financial performance.

Alico employs various mitigation strategies to address these risks. These may include:

• Diversification: Diversifying its agricultural operations by growing different types of crops can help reduce the company's reliance on a single commodity and mitigate the impact of price fluctuations or crop failures.
• Risk Management: Implementing robust risk management practices, such as insurance coverage for crop losses and hedging strategies to protect against price volatility, can help cushion the financial impact of adverse events.
• Operational Efficiencies: Continuously improving operational efficiencies through the use of technology, better farming practices, and effective cost management can enhance profitability and competitiveness.

Below is a summary of potential risks and mitigation strategies:

Understanding these risks and mitigation strategies is crucial for investors assessing Alico's financial health and future prospects. For further insights into investor profiles, consider exploring: Exploring Alico, Inc. (ALCO) Investor Profile: Who’s Buying and Why?

Alico, Inc. (ALCO) Growth Opportunities

Alico, Inc. (ALCO) possesses several key drivers that could influence its future growth trajectory. These include strategic land management, citrus production efficiencies, and opportunistic acquisitions.

Future revenue growth projections and earnings estimates for Alico, Inc. (ALCO) depend significantly on citrus yields, market prices, and real estate transactions. Investors should monitor these factors closely to gauge the company's potential financial performance. For additional insights into investor behavior, see: Exploring Alico, Inc. (ALCO) Investor Profile: Who’s Buying and Why?

Strategic initiatives and partnerships could play a crucial role in driving Alico, Inc.'s (ALCO) future growth. These may include:

• Optimizing land use for higher-value crops or development projects.
• Expanding citrus processing capabilities to increase profitability.
• Forming partnerships to enhance distribution networks.

Alico, Inc.'s (ALCO) competitive advantages that position the company for growth include its extensive land holdings in Florida, its established presence in the citrus industry, and its experienced management team. These assets provide a solid foundation for sustainable growth and value creation.

Here's an overview of potential factors influencing Alico, Inc.'s (ALCO) growth prospects: