Overall Score

Business Quality

ACCO shows acceptable profitability with TTM gross margin of 31.2% and operating margin of 6.3%.

Return metrics remain modest, with ROIC at 3.8% and ROE at 8.8%.

The company still carries meaningful leverage, with net debt to EBITDA at 4.68x.

Financial Strength

Liquidity is adequate, with a current ratio of 2.0x and quick ratio of 1.22x.

Debt remains elevated relative to earnings power, with debt to equity at 1.46x and interest coverage at 2.14x.

Working capital is positive at $423.8M, but the balance sheet remains constrained by negative tangible book value.

Growth Runway

The business has limited organic growth evidence in the current metrics, with no R&D spend and only modest profitability expansion potential.

Asset turnover of 0.68x suggests the company can still extract more efficiency from its asset base.

High inventory days of 110.7 and a 197.6-day operating cycle indicate working-capital drag on growth.

Profitability Trend

Operating cash flow conversion is decent, with free cash flow yield at 13.2% and capex only 25.5% of operating cash flow.

Income quality is above 1.0x, suggesting reported earnings are backed by cash generation.

However, low net margin of 3.7% limits the durability of earnings growth.

Valuation

Valuation remains attractive, with EV/sales at 0.83x and price/free cash flow at 7.6x.

The stock trades at 6.8x earnings, which is modest for a profitable business.

Price to book of 0.58x also suggests the market is discounting the asset base.