Despite its impressive fundamentals, NYSE:TS remains undervalued.

Last update: Nov 2, 2023

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

A Closer Look at Valuation for NYSE:TS

ChartMill assigns a Valuation Rating to every stock. This score ranges from 0 to 10 and evaluates the different valuation aspects and compares the price to earnings and cash flows, while taking into account profitability and growth. NYSE:TS scores a 9 out of 10:

A Price/Earnings ratio of 3.93 indicates a rather cheap valuation of TS.
Based on the Price/Earnings ratio, TS is valued cheaply inside the industry as 98.46% of the companies are valued more expensively.
When comparing the Price/Earnings ratio of TS to the average of the S&P500 Index (23.21), we can say TS is valued rather cheaply.
With a Price/Forward Earnings ratio of 6.52, the valuation of TS can be described as very cheap.
Based on the Price/Forward Earnings ratio, TS is valued a bit cheaper than 78.46% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of TS to the average of the S&P500 Index (18.26), we can say TS is valued rather cheaply.
Based on the Enterprise Value to EBITDA ratio, TS is valued cheaply inside the industry as 95.38% of the companies are valued more expensively.
TS's Price/Free Cash Flow ratio is rather cheap when compared to the industry. TS is cheaper than 87.69% 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.
The excellent profitability rating of TS may justify a higher PE ratio.

Looking at the Profitability

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:TS, the assigned 8 is noteworthy for profitability:

TS's Return On Assets of 19.03% is amongst the best of the industry. TS outperforms 96.92% of its industry peers.
With an excellent Return On Equity value of 23.46%, TS belongs to the best of the industry, outperforming 86.15% of the companies in the same industry.
With an excellent Return On Invested Capital value of 22.43%, TS belongs to the best of the industry, outperforming 96.92% of the companies in the same industry.
TS's Profit Margin of 24.75% is amongst the best of the industry. TS outperforms 98.46% of its industry peers.
TS's Profit Margin has improved in the last couple of years.
TS has a better Operating Margin (30.53%) than 96.92% of its industry peers.
In the last couple of years the Operating Margin of TS has grown nicely.
Looking at the Gross Margin, with a value of 43.25%, TS belongs to the top of the industry, outperforming 87.69% of the companies in the same industry.
TS's Gross Margin has improved in the last couple of years.

Deciphering NYSE:TS's Health Rating

Every stock is evaluated by ChartMill, receiving a Health Rating on a scale of 0 to 10. This assessment considers different health aspects, including liquidity and solvency, both in absolute terms and relative to industry peers. NYSE:TS has achieved a 9 out of 10:

TS has an Altman-Z score of 6.12. This indicates that TS is financially healthy and has little risk of bankruptcy at the moment.
TS has a Altman-Z score of 6.12. This is amongst the best in the industry. TS outperforms 92.31% of its industry peers.
TS has a debt to FCF ratio of 0.32. This is a very positive value and a sign of high solvency as it would only need 0.32 years to pay back of all of its debts.
With an excellent Debt to FCF ratio value of 0.32, TS belongs to the best of the industry, outperforming 96.92% of the companies in the same industry.
TS has a Debt/Equity ratio of 0.01. This is a healthy value indicating a solid balance between debt and equity.
With an excellent Debt to Equity ratio value of 0.01, TS belongs to the best of the industry, outperforming 92.31% of the companies in the same industry.
A Current Ratio of 3.71 indicates that TS has no problem at all paying its short term obligations.
TS's Current ratio of 3.71 is amongst the best of the industry. TS outperforms 90.77% of its industry peers.
A Quick Ratio of 2.21 indicates that TS has no problem at all paying its short term obligations.
Looking at the Quick ratio, with a value of 2.21, TS belongs to the top of the industry, outperforming 84.62% of the companies in the same industry.

Evaluating Growth: NYSE:TS

ChartMill employs its own Growth Rating system for all stocks. This score, ranging from 0 to 10, is derived by evaluating different growth factors, such as EPS and revenue growth, taking into account both past performance and future projections. NYSE:TS has earned a 5 for growth:

TS shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 159.62%, which is quite impressive.
TS shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 41.56% yearly.
Looking at the last year, TS shows a very strong growth in Revenue. The Revenue has grown by 64.96%.
Measured over the past years, TS shows a quite strong growth in Revenue. The Revenue has been growing by 17.34% on average per year.

Every day, new Decent Value stocks can be found on ChartMill in our Decent Value screener.

Our latest full fundamental report of TS contains the most current fundamental analsysis.

Disclaimer

Important Note: The content of this article is not intended as trading advice. It is essential to perform your own analysis and exercise caution when making trading decisions. The article presents observations created by automated analysis but does not guarantee any trading or investment outcomes. Always trade responsibly and make independent judgments.