Sunday, January 18, 2015

Analysis of Ariston 2015

Ariston, a German real estate company

Company: Ariston


Business: A German real estate company. They are active in four directions: 1. Income from property management 2. Investment income of daughter companies, 3. Income from sale of properties and 4. Income from opportunistic real estate investments.

Active: In Germany with 137000 m2 on six locations in eight real estates.

P/E: -1.5 (also P/E5 is negative)

Here you can find the previous analysis of Ariston.

contrarian values of P/E, P/B, ROE as well as dividend for Ariston

The P/E is awful with -1.5 but the P/B is looking excellent with 0.2! In the end we get a no go from Graham due to the earnings loss of Ariston the last year. Earnings to sales as well as ROE are useless due to loss but the book to debt ratio is at 0.4 which is reasonable for a real estate company.
In the last five years they have had a yearly negative growth rate of -3.9% which is pretty amazing considering that the property prices in Germany has in many regions increased by more than 30% during the last couple of years. Anyway this gives us a motivated P/E of around 8. The P/B is however very low so I will stretch myself to say that the company is slightly undervalued today.
They pay no dividends which we do not like.

Conclusion: Graham says no to this company and due to the low P/B I could probably buy them as a pure P/B investment but I will not. They have since the last two years made losses and they are now kicked out from the Stocks of Interest list.

If this analysis is outdated then you can request a new one.

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