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Is this Large Market Cap Stock target price reasonable for ALLETE, Inc. (NYSE:ALE)?

The company in question is, ALLETE, Inc. (NYSE:ALE) currently with a stock price of 57.88 (-0.29% today). The market cap for ALLETE, Inc. is 2863.03, and is in the sector Utilities, and Diversified Utilities industry. The target price for ALLETE, Inc. is 63.13. Currently ALLETE, Inc. is trading with a P/E of 19.1, and a forward P/E of 16.48. Average volume for ALLETE, Inc. is 194.52 and so far today it is 32170.

Performance in the last year for ALLETE, Inc. has been 16.95%. For EPS growth, ALLETE, Inc. has seen a growth of 0.70%, and is looking to grow in the next year to 12.96%. More long term stats show that EPS growth has been 5.80% over the last five years and could be 5.00% for the next five years. ALLETE, Inc. has seen sales growth quarter over quarter at -2.60%, with EPS growth quarter over quarter at 8.40%. The 20-day simple moving average is -3.44%, with the 200-day simple moving average coming to 1.71%.

Since the IPO date for ALLETE, Inc. on the 05/03/1973, ALLETE, Inc. has seen performance year to date to be 17.37%. With ALLETE, Inc. trading at 57.88, the dividend yield is 3.58%, and the EPS is 3.04.

So could ALLETE, Inc., be undervalued? Well as said before P/E is 19.1. The PEG is 3.82, P/S is 1.92 and the P/B is at 1.55. The P/cash is 31.15, with P/free cash flow at *TBA.

ALLETE, Inc. ability to deal with debt shows that the current ratio is 1.3, and the quick ratio is 0.9. This is with long term debt/equity at 0.81, and total debt/equity at 0.84.

In terms of margins, ALLETE, Inc. has a gross margin of 80.90%, an operating margin of 15.00% and a profit margin of 10.00%.Payout ratio for ALLETE, Inc. is 67.30%. Return on assets come to 3.10% with return on investment coming to 5.40%.

Insider ownership for ALLETE, Inc., is at 0.30% and institutional ownership comes to 71.50%. Outstanding shares are at 49.32. While shares float is 49.2. The float short is currently 1.94%, and short ratio is 4.91.

Disclaimer: Remember there is a risk to your investment, this is not a recommendation, nor personal advice, never invest more than you are able too loose.

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Stephen Butters

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