American Funds American Balanced Fund Class A
American Funds American Balanced Fund Class A Fundamental Analysis
American Funds American Balanced Fund Class A (ABALX) shows weak financial fundamentals with a PE ratio of 4283.91, profit margin of 7.31%, and ROE of 12.67%. The company generates $0.9B in annual revenue with N/A year-over-year growth of N/A.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 60.0/100 based on profitability, valuation, growth, and balance sheet metrics. The C+ grade reflects average fundamentals, with notable risks in certain areas.
Fundamental Health Score
We analyze ABALX's fundamental strength across five key dimensions:
Efficiency Score
WeakABALX struggles to generate sufficient returns from assets.
Valuation Score
WeakABALX trades at a premium to fair value.
Growth Score
ModerateABALX shows steady but slowing expansion.
Financial Health Score
ExcellentABALX maintains a strong and stable balance sheet.
Profitability Score
WeakABALX struggles to sustain strong margins.
Key Financial Metrics
Is ABALX Expensive or Cheap?
P/E Ratio
ABALX trades at 4283.91 times earnings. This suggests a premium valuation.
PEG Ratio
When adjusting for growth, ABALX's PEG of 42.84 indicates potential overvaluation.
Price to Book
The market values American Funds American Balanced Fund Class A at 507.94 times its book value. This suggests the stock is fully valued or overvalued on an asset basis.
EV/EBITDA
Enterprise value stands at 3172.40 times EBITDA. This signals the market has high growth expectations.
How Well Does ABALX Make Money?
Net Profit Margin
For every $100 in sales, American Funds American Balanced Fund Class A keeps $7.31 as profit after all expenses.
Operating Margin
Core operations generate 8.26 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $12.67 in profit for every $100 of shareholder equity.
ROA
American Funds American Balanced Fund Class A generates $9.17 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
American Funds American Balanced Fund Class A produces operating cash flow of $134.63M, showing steady but balanced cash generation.
Free Cash Flow
American Funds American Balanced Fund Class A generates strong free cash flow of $95.00M, providing ample flexibility for dividends, buybacks, or growth.
FCF Per Share
Each share generates $0.01 in free cash annually.
FCF Yield
ABALX converts 0.03% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
4283.91
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
42.84
vs 25 benchmark
P/B Ratio
Price to book value ratio
507.94
vs 25 benchmark
P/S Ratio
Price to sales ratio
329.52
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
0.02
vs 25 benchmark
Current Ratio
Current assets to current liabilities
6.82
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.13
vs 25 benchmark
ROA
Return on assets percentage
0.09
vs 25 benchmark
ROCE
Return on capital employed
0.12
vs 25 benchmark
How ABALX Stacks Against Its Sector Peers
| Metric | ABALX Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 4283.91 | 18.86 | Worse (Expensive) |
| ROE | 12.67% | 847.00% | Weak |
| Net Margin | 7.31% | 4202.00% | Weak |
| Debt/Equity | 0.02 | 0.91 | Strong (Low Leverage) |
| Current Ratio | 6.82 | 667.17 | Strong Liquidity |
| ROA | 9.17% | -21543.00% (disorted) | Weak |
ABALX outperforms its industry in 2 out of 6 key metrics, but lagging in P/E Ratio.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews American Funds American Balanced Fund Class A's 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
N/A
Industry Style: Value, Dividend, Cyclical
EPS CAGR
N/A
Industry Style: Value, Dividend, Cyclical
FCF CAGR
N/A
Industry Style: Value, Dividend, Cyclical