NYSE:TKR is probably undervalued for the fundamentals it is displaying.

Last update: Oct 26, 2023

Our stock screening tool has pinpointed TIMKEN CO (NYSE:TKR) as an undervalued stock option. NYSE:TKR retains a strong financial foundation and an attractive price tag. Let's delve into the specifics below.

Valuation Examination for NYSE:TKR

An integral part of ChartMill's stock analysis is the Valuation Rating, which spans from 0 to 10. This rating evaluates diverse valuation factors, including price to earnings and cash flows, while considering the stock's profitability and growth. NYSE:TKR has received a 8 out of 10:

Based on the Price/Earnings ratio of 10.06, the valuation of TKR can be described as reasonable.
87.69% of the companies in the same industry are more expensive than TKR, based on the Price/Earnings ratio.
TKR is valuated cheaply when we compare the Price/Earnings ratio to 24.74, which is the current average of the S&P500 Index.
TKR is valuated reasonably with a Price/Forward Earnings ratio of 9.01.
87.69% of the companies in the same industry are more expensive than TKR, based on the Price/Forward Earnings ratio.
When comparing the Price/Forward Earnings ratio of TKR to the average of the S&P500 Index (18.34), we can say TKR is valued rather cheaply.
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of TKR indicates a somewhat cheap valuation: TKR is cheaper than 80.00% of the companies listed in the same industry.
Based on the Price/Free Cash Flow ratio, TKR is valued cheaper than 84.62% of the companies in the same industry.
The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
TKR has a very decent profitability rating, which may justify a higher PE ratio.

Profitability Insights: NYSE:TKR

ChartMill employs its own Profitability Rating system for stock evaluation. This score, ranging from 0 to 10, is derived from an analysis of diverse profitability metrics and margins. In the case of NYSE:TKR, the assigned 7 is noteworthy for profitability:

TKR has a Return On Assets of 6.91%. This is in the better half of the industry: TKR outperforms 71.54% of its industry peers.
The Return On Equity of TKR (17.05%) is better than 77.69% of its industry peers.
The Return On Invested Capital of TKR (10.50%) is better than 73.85% of its industry peers.
The last Return On Invested Capital (10.50%) for TKR is above the 3 year average (9.52%), which is a sign of increasing profitability.
The Profit Margin of TKR (9.08%) is better than 73.08% of its industry peers.
TKR's Profit Margin has improved in the last couple of years.
TKR's Operating Margin of 14.97% is fine compared to the rest of the industry. TKR outperforms 78.46% of its industry peers.
TKR's Operating Margin has improved in the last couple of years.

Health Analysis for NYSE:TKR

ChartMill employs its own Health Rating for stock assessment. This rating, ranging from 0 to 10, is calculated by examining various liquidity and solvency ratios. In the case of NYSE:TKR, the assigned 5 reflects its health status:

TKR's Debt to FCF ratio of 5.06 is fine compared to the rest of the industry. TKR outperforms 66.15% of its industry peers.
A Current Ratio of 2.65 indicates that TKR has no problem at all paying its short term obligations.
TKR has a better Current ratio (2.65) than 65.38% of its industry peers.
Looking at the Quick ratio, with a value of 1.43, TKR is in the better half of the industry, outperforming 66.15% of the companies in the same industry.

Growth Assessment of NYSE:TKR

ChartMill assigns a Growth Rating to each stock, ranging from 0 to 10. This rating is determined by analyzing different growth elements, including EPS and revenue growth, spanning both historical and future figures. In the case of NYSE:TKR, the assigned 6 reflects its growth potential:

The Earnings Per Share has grown by an impressive 30.53% over the past year.
TKR shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 18.10% yearly.
TKR shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 9.96%.
Measured over the past years, TKR shows a quite strong growth in Revenue. The Revenue has been growing by 8.40% on average per year.
TKR is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 11.46% yearly.

More Decent Value stocks can be found in our Decent Value screener.

For an up to date full fundamental analysis you can check the fundamental report of TKR

Disclaimer

This article should in no way be interpreted as advice in any way. The article is based on the observed metrics at the time of writing, but you should always make your own analysis and trade or invest at your own responsibility.