Despite its impressive fundamentals, NYSE:TS remains undervalued.

Last update: Jan 5, 2024

TENARIS SA-ADR (NYSE:TS) has caught the attention of our stock screener as a great value stock. NYSE:TS excels in profitability, solvency, and liquidity, all while being very reasonably priced. Let's delve into the details.

How We Gauge Valuation for NYSE:TS

ChartMill assigns a Valuation Rating to each stock, ranging from 0 to 10. This rating is calculated by analyzing different valuation elements, such as price to earnings and free cash flow, both in absolute terms and relative to the market and industry. In the case of NYSE:TS, the assigned 9 reflects its valuation:

With a Price/Earnings ratio of 4.20, the valuation of TS can be described as very cheap.
Based on the Price/Earnings ratio, TS is valued cheaper than 98.46% of the companies in the same industry.
TS is valuated cheaply when we compare the Price/Earnings ratio to 25.53, which is the current average of the S&P500 Index.
The Price/Forward Earnings ratio is 6.87, which indicates a rather cheap valuation of TS.
TS's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. TS is cheaper than 80.00% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of TS to the average of the S&P500 Index (20.53), we can say TS is valued rather cheaply.
Based on the Enterprise Value to EBITDA ratio, TS is valued cheaper than 95.38% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, TS is valued 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.
TS has an outstanding profitability rating, which may justify a higher PE ratio.

How do we evaluate the Profitability for NYSE:TS?

ChartMill assigns a proprietary Profitability Rating to each stock. The score is computed by evaluating various profitability ratios and margins and ranges from 0 to 10. NYSE:TS was assigned a score of 8 for profitability:

TS has a better Return On Assets (18.13%) than 96.92% of its industry peers.
The Return On Equity of TS (22.16%) is better than 86.15% of its industry peers.
With an excellent Return On Invested Capital value of 21.90%, TS belongs to the best of the industry, outperforming 96.92% of the companies in the same industry.
Looking at the Profit Margin, with a value of 23.86%, TS belongs to the top of the industry, outperforming 98.46% of the companies in the same industry.
TS's Profit Margin has improved in the last couple of years.
Looking at the Operating Margin, with a value of 30.43%, TS belongs to the top of the industry, outperforming 96.92% of the companies in the same industry.
TS's Operating Margin has improved in the last couple of years.
TS has a better Gross Margin (42.87%) than 87.69% of its industry peers.
In the last couple of years the Gross Margin of TS has grown nicely.

Health Insights: NYSE:TS

ChartMill employs a unique Health Rating system for all stocks. This rating, ranging from 0 to 10, is determined by analyzing various liquidity and solvency ratios. For NYSE:TS, the assigned 9 for health provides valuable insights:

An Altman-Z score of 6.34 indicates that TS is not in any danger for bankruptcy at the moment.
The Altman-Z score of TS (6.34) is better than 93.85% of its industry peers.
TS has a debt to FCF ratio of 0.21. This is a very positive value and a sign of high solvency as it would only need 0.21 years to pay back of all of its debts.
TS has a Debt to FCF ratio of 0.21. This is amongst the best in the industry. TS outperforms 90.77% of its industry peers.
TS has a Debt/Equity ratio of 0.01. This is a healthy value indicating a solid balance between debt and equity.
The Debt to Equity ratio of TS (0.01) is better than 87.69% of its industry peers.
A Current Ratio of 3.94 indicates that TS has no problem at all paying its short term obligations.
Looking at the Current ratio, with a value of 3.94, TS belongs to the top of the industry, outperforming 92.31% of the companies in the same industry.
A Quick Ratio of 2.40 indicates that TS has no problem at all paying its short term obligations.
With an excellent Quick ratio value of 2.40, TS belongs to the best of the industry, outperforming 86.15% of the companies in the same industry.

Growth Analysis for NYSE:TS

ChartMill assigns a proprietary Growth Rating to each stock. The score is computed by evaluating various growth aspects, like EPS and revenue growth. We take into account the history as well as the estimated future numbers. NYSE:TS was assigned a score of 5 for growth:

The Earnings Per Share has grown by an impressive 122.32% over the past year.
TS shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 41.56% yearly.
The Revenue has grown by 47.79% in the past year. This is a very strong growth!
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.

Our Decent Value screener lists more Decent Value stocks and is updated daily.

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

Keep in mind

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.