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Andersons (ANDE): analysis traps
Where its figures could mislead a reader, and what to check before taking them at face value · Data: Q3 2026, to Sep 30, 2026, filed Nov 4, 2026; rules v1.1
Andersons (ANDE): 2 rules of 10 triggered on the filings to Sep 30, 2026: low net debt = no refinancing risk; low P/E at a cyclical peak = undervalued; 4 with insufficient data; 2 not applicable. Each is a question to verify, with the normal explanation that would produce the same figures.
Check these first
Low net debt = no refinancing risk Triggered · severity high · confidence medium
$518M of debt comes due within a year against $58M of cash and investments and no free cash flow to add: $460M short, to be refinanced or raised. Net debt of $997M says nothing about when the debt falls due.
Innocent reading: A committed, undrawn credit facility covers the gap (not visible in the balance sheet).
Low P/E at a cyclical peak = undervalued Triggered · severity medium · confidence medium
The shares trade at 9.6× this year's net income of $204M, but that profit is at a high: the median of the last eight fiscal years is $101M, on which the same market value is 19.3×. A low multiple of peak profit is not a low multiple of normal profit.
Innocent reading: The business has changed for good (a merger, a new line, a pricing regime) and the old years are not its normal.
Every rule
A01 FCF growth = the business improved Not triggered confidence high
Free cash flow did not rise ($182M → −$56M): the trap does not arise.
The figures and how they are read
| Fiscal year before | FY2024 |
| Fiscal year | FY2025 |
| Operating cash flow, year before | $332M |
| Operating cash flow | $177M |
| Capex, year before | $149M |
| Capex | $233M |
| Free cash flow, year before | $182M |
| Free cash flow | −$56M |
| Change in FCF | −$238M |
| Change in capex | $84M |
| Working capital: change in its cash contribution | −$169M |
FCF = operating cash flow − cash capex; ΔFCF = ΔOCF − ΔCapEx; the working-capital part is the change in the cash-bridge items (receivables, inventory, payables, accruals), with the sign of the cash flow statement
Source: FY2025 (cash flow statement, fiscal year) · FY2024 (cash flow statement, fiscal year before)
A07 Stock compensation added back = no economic cost Not triggered confidence high
Stock compensation is 0.2% of revenue: small enough that adding it back changes little.
The figures and how they are read
| Fiscal year | FY2025 |
| Stock compensation | $17M |
| Revenue | $11.0B |
| SBC / revenue | +0.1% |
| Buybacks | $15M |
| Buybacks / SBC | 0.9 |
| Diluted shares, year before | 34.3M shares |
| Diluted shares | 34.3M shares |
| Diluted shares: change | +0.0% |
SBC / revenue from the cash flow statement's add-back; the diluted weighted share count year over year; buybacks from the financing section
Source: FY2025 (stock compensation, buybacks and the diluted share count, fiscal year)
B02 Receivables growing = future cash is certain Insufficient data
fewer than five quarters with receivables and revenue on file (a year-over-year comparison needs five)
B08 Adjusted profit = economic profit Insufficient data
no reconciliation table read from the releases yet and fewer than three quarters with both an adjusted and a GAAP EPS
C02 Low net debt = no refinancing risk Triggered severity high · confidence medium
$518M of debt comes due within a year against $58M of cash and investments and no free cash flow to add: $460M short, to be refinanced or raised. Net debt of $997M says nothing about when the debt falls due.
The figures and how they are read
| Cash and investments | $58M |
| Debt | $1.1B |
| Net debt | $997M |
| Due within a year | $518M |
| Read from | the current portion of debt on the balance sheet |
| Free cash flow, twelve months | −$294M |
| Cash plus free cash flow | $58M |
| Coverage of what is due | 0.1 |
| Due in the second year | — |
| Balance sheet date | 2026-09-30 |
due within a year from the maturity table (else the current portion of debt), against cash and investments plus free cash flow over the last twelve months (zero if negative); no credit lines assumed
Source: 2026-09-30 (debt maturities, cash and investments)
What would explain it innocently
- A committed, undrawn credit facility covers the gap (not visible in the balance sheet)
- The notes are routinely rolled over in the commercial-paper or bond market at an investment-grade rating
- Cash held abroad or in subsidiaries can be moved to where the debt is
- A sale of a business or asset already agreed brings the cash
What to look for in the filing
- Undrawn committed facilities and their covenants
- The cost and rating of the refinancing
- Restricted cash and the operating minimum
What would show the trap does not apply
- The 10-K lists an undrawn credit facility that covers the debt due, or the maturity is refinanced before it falls due
- Cash plus FCF of the next quarter exceeds the debt due within a year
Look again: next filing.
D03 EPS growth = profit growth Insufficient data
no quarter with EPS, net income and diluted shares for both this year and last
E02 Low P/E at a cyclical peak = undervalued Triggered severity medium · confidence medium
The shares trade at 9.6× this year's net income of $204M, but that profit is at a high: the median of the last eight fiscal years is $101M, on which the same market value is 19.3×. A low multiple of peak profit is not a low multiple of normal profit.
The figures and how they are read
| market value | $1.9B |
| net income ttm | $204M |
| pe ttm | 9.60 |
| net income median fy | $101M |
| pe mid cycle | 19.30 |
| net income peak fy | $131M |
| years | FY2018 / 41.0; FY2019 / 18.0; FY2020 / 8.0; FY2021 / 104.0; FY2022 / 131.0; FY2023 / 101.0; FY2024 / 114.0; FY2025 / 96.0 |
| down years in window | 4 |
P/E on the trailing twelve months' net income against the P/E on the median net income of the last eight fiscal years (a mid-cycle stand-in); 'at a peak' = this year's profit at or above 90% of the best year and at least 1.3× the median
Source: Q3 2026 (net income, trailing twelve months)
What would explain it innocently
- The business has changed for good (a merger, a new line, a pricing regime) and the old years are not its normal
- The market is right that profit will fall, and the price already says so
- Capacity has left the industry, so the cycle's trough is higher than before
What to look for in the filing
- Where the industry's prices and volumes stand against their own history
- Capacity on order across the industry
- Management's view of the cycle in the MD&A
What would show the trap does not apply
- Profit holds at this level through the next two years (the eight-year peak was a new base, not a top)
- The industry's capacity and prices stay where they are rather than reverting
Look again: next filing.
E07 A precise DCF value = the true value Insufficient data
no DCF in the valuation research for this company
J06 A bank's low P/E and high profit = safe Not applicable
not a bank
J08 A REIT's low net income = the dividend is unsafe Not applicable
not a REIT
What the statuses mean
Triggered: the filings show the pattern; read the normal explanations and the missing evidence before concluding anything. To review: one quarter or a weak signal; a reader's judgement, not a pattern. Not triggered: the pattern is absent on these figures. Insufficient data: the filings read so far do not hold what the rule needs; this is not a clean bill. Not applicable: the rule is not meant for this kind of company (a bank's working capital, a loss-making quarter's EPS growth). Out of date: the latest filing is more than fifteen months old.
Severity is what the pattern could mean for cash, value or solvency; confidence is how reliable the inputs and the reading are. The two are kept apart.
Record a view
A reader's judgement, grounds, what would change it and the next review; kept in the browser (needs JavaScript).
Every rule and the companies it triggers on → Andersons: cash flow → Earnings quality score →
Each rule reads the company's own filings by a fixed formula and says what would explain the same figures innocently. A triggered rule is a question to verify, not a finding of manipulation, and not a view on the stock. Missing data is shown as missing, never as clear. Not investment advice.