Alamo Group (ALG) closed out FY 2025 with fourth quarter revenue of US$373.7 million and basic EPS of US$1.29, alongside net income of US$15.5 million. Its trailing twelve month figures show revenue of US$1.6 billion, basic EPS of US$8.64 and net income of US$103.8 million. Over recent quarters, the company has seen quarterly revenue move between US$390.9 million and US$420.0 million, with basic EPS ranging from US$1.29 to US$2.65. This gives investors a clear view of how earnings power has tracked alongside the top line. With trailing net profit margins easing compared with a year earlier, this set of numbers puts the focus squarely on how sustainably Alamo Group can defend its profitability.

See our full analysis for Alamo Group.

With the latest results on the table, the next step is to see how these figures line up with the widely held narratives about Alamo Group’s growth, risks, and earnings quality, and where those stories may need updating.

Margins Soften, Net Profit Margin At 6.5%

• The trailing 12 month net profit margin sits at 6.5%, compared with 7.1% a year earlier, alongside US$1.6b of revenue and US$103.8 million of net income.
• Consensus narrative points to efficiency gains and margin support. However, the margin slip from 7.1% to 6.5% means:
  • Record sales and strong order trends in areas like Industrial Equipment do not fully show up in the current 6.5% margin.
  • Recovery efforts in Vegetation Management and cost reductions will need to work through before any margin rebuild appears in the consolidated figures.

EPS Trend Softens Against High Quality Label

• Trailing EPS of US$8.64 compares with earlier trailing readings above US$9, even though the company is still described as having high quality past earnings over the last 12 months.
• Bears focus on the recent negative earnings growth over the last year, which sits alongside:
  • A five year earnings growth rate of 12.3% per year, showing a longer run track record that is not reflected in the most recent 12 month softness.
  • Quarterly EPS ranging from US$1.29 to US$2.65 over FY 2025, which highlights how short term swings can differ from the multi year growth story.

Over the last year, some investors argue the recent earnings dip may matter more than the 12.3% five year growth record, while others see the long term trend as the anchor for their view of Alamo Group. 🐻 Alamo Group Bear Case

P/E Below Peers With DCF Value Gap

• At a share price of US$184.78, Alamo Group trades on a P/E of 21.6x, below the US Machinery industry at 28.4x and peer average at 23x, and sits about 7.7% under a DCF fair value of roughly US$200.25.
• Bulls argue that this valuation gap lines up with the earnings growth profile. Yet current numbers show:
  • Forecast earnings growth of about 15.44% per year compared with forecast revenue growth of 3.3% per year, which means expectations lean on margin and earnings quality rather than top line acceleration.
  • Trailing net profit margin at 6.5%, below 7.1% a year earlier, so the market is weighing lower multiples against a margin picture that has softened over the last 12 months.

If you are weighing whether the 21.6x P/E and the gap to the roughly US$200.25 DCF fair value really reflect the growth and margin story, it is worth seeing how bullish investors frame that trade off in more detail. 🐂 Alamo Group Bull Case

Next Steps

To see how these results tie into long-term growth, risks, and valuation, check out the full range of community narratives for Alamo Group on Simply Wall St. Add the company to your watchlist or portfolio so you'll be alerted when the story evolves.

If the mixed signals in the latest numbers leave you unsure, take a moment to review the details yourself and act while the data is fresh, including seeing the 2 key rewards that investors are currently optimistic about.

See What Else Is Out There

Alamo Group’s softer 6.5% net margin alongside recent EPS softness and a below peer P/E suggests some investors may question how resilient its profitability really is.

If that margin pressure makes you cautious, you might want to quickly compare it with companies in our 75 resilient stocks with low risk scores that focus on steadier earnings and lower overall risk.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.