Despite its impressive fundamentals, NYSE:TS remains undervalued.

Last update: Jul 16, 2024

TENARIS SA-ADR (NYSE:TS) is a hidden gem identified by our stock screening tool, featuring undervaluation and robust fundamentals. NYSE:TS showcases decent financial health and profitability, coupled with an attractive price. Let's dig deeper into the analysis.

Looking at the Valuation

ChartMill assigns a proprietary Valuation Rating to each stock. The score is computed by evaluating various valuation aspects, like price to earnings and free cash flow, both absolutely as relative to the market and industry. NYSE:TS was assigned a score of 8 for valuation:

A Price/Earnings ratio of 5.11 indicates a rather cheap valuation of TS.
Compared to the rest of the industry, the Price/Earnings ratio of TS indicates a rather cheap valuation: TS is cheaper than 100.00% of the companies listed in the same industry.
When comparing the Price/Earnings ratio of TS to the average of the S&P500 Index (29.19), we can say TS is valued rather cheaply.
The Price/Forward Earnings ratio is 7.96, which indicates a rather cheap valuation of TS.
Compared to the rest of the industry, the Price/Forward Earnings ratio of TS indicates a rather cheap valuation: TS is cheaper than 81.54% of the companies listed in the same industry.
TS is valuated cheaply when we compare the Price/Forward Earnings ratio to 20.63, which is the current average of the S&P500 Index.
TS's Enterprise Value to EBITDA ratio is rather cheap when compared to the industry. TS is cheaper than 98.46% of the companies in the same industry.
TS's Price/Free Cash Flow ratio is rather cheap when compared to the industry. TS is cheaper than 93.85% of the companies in the same industry.
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 9 is noteworthy for profitability:

TS has a better Return On Assets (18.58%) than 98.46% of its industry peers.
TS has a better Return On Equity (23.26%) than 89.23% of its industry peers.
The Return On Invested Capital of TS (19.52%) is better than 98.46% of its industry peers.
TS had an Average Return On Invested Capital over the past 3 years of 13.95%. This is significantly above the industry average of 7.74%.
The last Return On Invested Capital (19.52%) for TS is above the 3 year average (13.95%), which is a sign of increasing profitability.
TS has a Profit Margin of 26.35%. This is amongst the best in the industry. TS outperforms 98.46% of its industry peers.
TS's Profit Margin has improved in the last couple of years.
TS's Operating Margin of 28.80% is amongst the best of the industry. TS outperforms 95.38% of its industry peers.
In the last couple of years the Operating Margin of TS has grown nicely.
With an excellent Gross Margin value of 41.70%, TS belongs to the best of the industry, outperforming 83.08% of the companies in the same industry.
TS's Gross Margin has improved in the last couple of years.

Health Analysis for NYSE:TS

A critical element of ChartMill's stock evaluation is the Health Rating, which spans from 0 to 10. This rating considers multiple health factors, including liquidity and solvency, both in absolute terms and relative to industry peers. NYSE:TS has received a 10 out of 10:

TS has an Altman-Z score of 5.41. This indicates that TS is financially healthy and has little risk of bankruptcy at the moment.
The Altman-Z score of TS (5.41) is better than 93.85% of its industry peers.
TS has a debt to FCF ratio of 0.19. This is a very positive value and a sign of high solvency as it would only need 0.19 years to pay back of all of its debts.
With an excellent Debt to FCF ratio value of 0.19, TS belongs to the best of the industry, outperforming 93.85% 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.
TS has a better Debt to Equity ratio (0.01) than 90.77% of its industry peers.
TS has a Current Ratio of 3.62. This indicates that TS is financially healthy and has no problem in meeting its short term obligations.
With an excellent Current ratio value of 3.62, TS belongs to the best of the industry, outperforming 89.23% of the companies in the same industry.
A Quick Ratio of 2.27 indicates that TS has no problem at all paying its short term obligations.
TS has a Quick ratio of 2.27. This is amongst the best in the industry. TS outperforms 81.54% of its industry peers.

Looking at the Growth

A key component of ChartMill's stock assessment is the Growth Rating, which spans from 0 to 10. This rating evaluates diverse growth factors, such as EPS and revenue growth, considering both past performance and future projections. NYSE:TS has received a 4 out of 10:

The Earnings Per Share has grown by an nice 11.90% over the past year.
The Earnings Per Share has been growing by 35.10% on average over the past years. 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 14.19% 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.

Keep in mind

This article should in no way be interpreted as advice. 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.