Is PAA a high-quality business?

AlphaMadera's AlphaQuality grade scores Plains All American Pipeline, L.P. on six pillars — profitability, capital efficiency, balance-sheet strength, growth durability, cash generation, and shareholder yield. The composite letter grade reflects how PAA compares to a Buffett-style quality bar.

What is Plains All American Pipeline, L.P.'s AlphaQuality grade?

AlphaQuality assigns a letter grade (A through F) to PAA based on a six-pillar quantitative model. The live page shows the composite grade plus each pillar's individual score with the underlying metrics.

What makes PAA a quality stock?

AlphaQuality looks at return on capital, free-cash-flow margins, debt-to-equity, revenue stability, dividend and buyback policy, and operating-margin trend. Stocks scoring well across all six pillars earn higher grades — the methodology favors compounders over cyclicals.

PAA - Plains All American Pipeline, L.P.

Price: -- -- | CONSENSUS: Buy DETAILS | PRICE TARGET: $23.67 DETAILS

AlphaQuality

Quantitative six-pillar business-quality grade

Stable Earnings Power

AlphaQuality — archetype-weighted quantitative grade

C 55.4 / 100 composite

Composite Grade

Composite of six pillars weighted for stable earnings power businesses. Purely quantitative — no stock price or analyst input.

Profitability

Weight: 20%

C 54.1

5yr Avg ROIC 8.1% 50/100
Operating Margin Trend +0.25 pp/yr 63/100

Capital Efficiency

Weight: 15%

B- 64.9

5yr Avg ROE 10.3% 62/100
5yr Share-Count CAGR -0.4% 71/100

Growth Quality

Weight: 15%

C+ 60.8

5yr Revenue CAGR 1.3% 31/100
5yr EPS CAGR 31.8% 100/100
Revenue-Growth Years (5) 3/5 60/100

Cash Generation

Weight: 15%

C+ 60.5

5yr FCF Margin 4.1% 46/100
5yr FCF/NI Conversion 2.09x 79/100

Balance Sheet

Weight: 20%

C 55.6

Net Debt / EBITDA 2.26x 65/100
Interest Coverage (EBIT/Int) 3.53x 50/100
Altman Z-Score 2.13 45/100

Stability

Weight: 15%

D 37.1

EPS Volatility (σ/μ) 0.63 19/100
Piotroski F-Score 4 44/100
Negative-Revenue Years (5) 2/5 60/100

Not held by any curated guru.

How this is calculated

AlphaQuality grades six pillars from 0-100 and weights each by archetype:

Profitability (20%) — 5yr Avg ROIC, Operating Margin Trend
Capital Efficiency (15%) — 5yr Avg ROE, 5yr Share-Count CAGR
Growth Quality (15%) — 5yr Revenue CAGR, 5yr EPS CAGR, Revenue-Growth Years (5)
Cash Generation (15%) — 5yr FCF Margin, 5yr FCF/NI Conversion
Balance Sheet (20%) — Net Debt / EBITDA, Interest Coverage (EBIT/Int), Altman Z-Score
Stability (15%) — EPS Volatility (σ/μ), Piotroski F-Score, Negative-Revenue Years (5)

We deliberately ignore stock price, analyst targets, and consensus ratings so the grade is suitable for backtesting forward returns. A minimum of 5 fiscal years of audited statements is required; distressed and highly leveraged infrastructure businesses are declared ungradable rather than forced into a numeric score.