DONALDSON CO INC (DCI) Stock Fundamental Analysis
NYSE:DCI - New York Stock Exchange, Inc. - US2576511099 - Common Stock - Currency: USD
DCI gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 129 industry peers in the Machinery industry. DCI has an excellent profitability rating, but there are some minor concerns on its financial health. DCI has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
DCI had positive earnings in the past year.
DCI had a positive operating cash flow in the past year.
Each year in the past 5 years DCI has been profitable.
DCI had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
DCI has a better Return On Assets (14.12%) than 91.20% of its industry peers.
DCI has a Return On Equity of 27.07%. This is amongst the best in the industry. DCI outperforms 90.40% of its industry peers.
DCI's Return On Invested Capital of 18.98% is amongst the best of the industry. DCI outperforms 93.60% of its industry peers.
DCI had an Average Return On Invested Capital over the past 3 years of 18.29%. This is significantly above the industry average of 10.79%.
The last Return On Invested Capital (18.98%) for DCI is above the 3 year average (18.29%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 14.12% | ||
| ROE | 27.07% | ||
| ROIC | 18.99% |
ROA(3y)13.32%
ROA(5y)12.67%
ROE(3y)28.11%
ROE(5y)27.12%
ROIC(3y)18.29%
ROIC(5y)17.08%
1.3 Margins
DCI has a Profit Margin of 11.51%. This is in the better half of the industry: DCI outperforms 76.80% of its industry peers.
In the last couple of years the Profit Margin of DCI has grown nicely.
With a decent Operating Margin value of 15.16%, DCI is doing good in the industry, outperforming 73.60% of the companies in the same industry.
In the last couple of years the Operating Margin of DCI has grown nicely.
The Gross Margin of DCI (35.62%) is better than 62.40% of its industry peers.
In the last couple of years the Gross Margin of DCI has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 15.16% | ||
| PM (TTM) | 11.51% | ||
| GM | 35.62% |
OM growth 3Y3.74%
OM growth 5Y2.29%
PM growth 3Y4.72%
PM growth 5Y4.21%
GM growth 3Y1.33%
GM growth 5Y1.35%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so DCI is still creating some value.
Compared to 1 year ago, DCI has less shares outstanding
Compared to 5 years ago, DCI has less shares outstanding
DCI has a better debt/assets ratio than last year.
2.2 Solvency
The Debt to FCF ratio of DCI is 1.67, which is an excellent value as it means it would take DCI, only 1.67 years of fcf income to pay off all of its debts.
DCI has a better Debt to FCF ratio (1.67) than 81.60% of its industry peers.
DCI has a Debt/Equity ratio of 0.36. This is a healthy value indicating a solid balance between debt and equity.
With a Debt to Equity ratio value of 0.36, DCI perfoms like the industry average, outperforming 57.60% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.36 | ||
| Debt/FCF | 1.67 | ||
| Altman-Z | N/A |
ROIC/WACC1.72
WACC11.03%
2.3 Liquidity
DCI has a Current Ratio of 1.86. This is a normal value and indicates that DCI is financially healthy and should not expect problems in meeting its short term obligations.
The Current ratio of DCI (1.86) is worse than 62.40% of its industry peers.
DCI has a Quick Ratio of 1.15. This is a normal value and indicates that DCI is financially healthy and should not expect problems in meeting its short term obligations.
DCI has a Quick ratio (1.15) which is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.86 | ||
| Quick Ratio | 1.15 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 13.55% over the past year.
DCI shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 9.03% yearly.
DCI shows a small growth in Revenue. In the last year, the Revenue has grown by 4.46%.
Measured over the past years, DCI shows a small growth in Revenue. The Revenue has been growing by 4.74% on average per year.
EPS 1Y (TTM)13.55%
EPS 3Y13.81%
EPS 5Y9.03%
EPS Q2Q%2.47%
Revenue 1Y (TTM)4.46%
Revenue growth 3Y7.91%
Revenue growth 5Y4.74%
Sales Q2Q%-0.76%
3.2 Future
DCI is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 7.14% yearly.
The Revenue is expected to grow by 62.60% on average over the next years. This is a very strong growth
EPS Next Y7.2%
EPS Next 2Y8.46%
EPS Next 3Y8.48%
EPS Next 5Y7.14%
Revenue Next Year129.35%
Revenue Next 2Y78.32%
Revenue Next 3Y48.61%
Revenue Next 5Y62.6%
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 19.63, DCI is valued on the expensive side.
Based on the Price/Earnings ratio, DCI is valued a bit cheaper than 65.60% of the companies in the same industry.
The average S&P500 Price/Earnings ratio is at 29.98. DCI is valued slightly cheaper when compared to this.
A Price/Forward Earnings ratio of 17.17 indicates a rather expensive valuation of DCI.
Compared to the rest of the industry, the Price/Forward Earnings ratio of DCI indicates a somewhat cheap valuation: DCI is cheaper than 68.80% of the companies listed in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 22.66, DCI is valued a bit cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.63 | ||
| Fwd PE | 17.17 |
4.2 Price Multiples
60.80% of the companies in the same industry are more expensive than DCI, based on the Enterprise Value to EBITDA ratio.
Based on the Price/Free Cash Flow ratio, DCI is valued a bit cheaper than the industry average as 61.60% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 23.86 | ||
| EV/EBITDA | 13.21 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
The excellent profitability rating of DCI may justify a higher PE ratio.
PEG (NY)2.73
PEG (5Y)2.17
EPS Next 2Y8.46%
EPS Next 3Y8.48%
5. Dividend
5.1 Amount
DCI has a Yearly Dividend Yield of 1.56%.
Compared to an average industry Dividend Yield of 1.74, DCI pays a bit more dividend than its industry peers.
DCI's Dividend Yield is slightly below the S&P500 average, which is at 2.30.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.56% |
5.2 History
The dividend of DCI has a limited annual growth rate of 5.51%.
DCI has paid a dividend for at least 10 years, which is a reliable track record.
DCI has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)5.51%
Div Incr Years28
Div Non Decr Years33
5.3 Sustainability
DCI pays out 30.40% of its income as dividend. This is a sustainable payout ratio.
The dividend of DCI is growing, but earnings are growing more, so the dividend growth is sustainable.
DP30.4%
EPS Next 2Y8.46%
EPS Next 3Y8.48%
69.09
+1.5 (+2.22%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryMachinery
Earnings (Last)
Earnings (Next)
Inst Owners87.86%
Inst Owner Change1.23%
Ins Owners0.51%
Ins Owner Change2.18%
Market Cap8.25B
Analysts70
Price Target77.93 (12.79%)
Short Float %1.57%
Short Ratio3.1
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.56% |
Yearly Dividend1.02
Dividend Growth(5Y)5.51%
DP30.4%
Div Incr Years28
Div Non Decr Years33
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)1102.83%
Min EPS beat(2)1096.46%
Max EPS beat(2)1109.19%
EPS beat(4)4
Avg EPS beat(4)1055.62%
Min EPS beat(4)951.3%
Max EPS beat(4)1109.19%
EPS beat(8)8
Avg EPS beat(8)782.22%
EPS beat(12)12
Avg EPS beat(12)632.71%
EPS beat(16)16
Avg EPS beat(16)554.16%
Revenue beat(2)2
Avg Revenue beat(2)406.52%
Min Revenue beat(2)384.87%
Max Revenue beat(2)428.17%
Revenue beat(4)4
Avg Revenue beat(4)431.28%
Min Revenue beat(4)384.87%
Max Revenue beat(4)459.72%
Revenue beat(8)8
Avg Revenue beat(8)456.72%
Revenue beat(12)12
Avg Revenue beat(12)530.46%
Revenue beat(16)16
Avg Revenue beat(16)664.12%
PT rev (1m)0%
PT rev (3m)0%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-2.16%
EPS NY rev (1m)0%
EPS NY rev (3m)0.31%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-0.12%
Revenue NY rev (1m)0%
Revenue NY rev (3m)0.32%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.63 | ||
| Fwd PE | 17.17 | ||
| P/S | 2.27 | ||
| P/FCF | 23.86 | ||
| P/OCF | 19.15 | ||
| P/B | 5.34 | ||
| P/tB | 9.02 | ||
| EV/EBITDA | 13.21 |
EPS(TTM)3.52
EY5.09%
EPS(NY)4.02
Fwd EY5.82%
FCF(TTM)2.9
FCFY4.19%
OCF(TTM)3.61
OCFY5.22%
SpS30.43
BVpS12.93
TBVpS7.66
PEG (NY)2.73
PEG (5Y)2.17
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 14.12% | ||
| ROE | 27.07% | ||
| ROCE | 25.1% | ||
| ROIC | 18.99% | ||
| ROICexc | 20.74% | ||
| ROICexgc | 29.98% | ||
| OM | 15.16% | ||
| PM (TTM) | 11.51% | ||
| GM | 35.62% | ||
| FCFM | 9.52% |
ROA(3y)13.32%
ROA(5y)12.67%
ROE(3y)28.11%
ROE(5y)27.12%
ROIC(3y)18.29%
ROIC(5y)17.08%
ROICexc(3y)20.31%
ROICexc(5y)19.16%
ROICexgc(3y)29.87%
ROICexgc(5y)27.08%
ROCE(3y)24.03%
ROCE(5y)22.48%
ROICexcg growth 3Y10.71%
ROICexcg growth 5Y4.17%
ROICexc growth 3Y5.64%
ROICexc growth 5Y1.68%
OM growth 3Y3.74%
OM growth 5Y2.29%
PM growth 3Y4.72%
PM growth 5Y4.21%
GM growth 3Y1.33%
GM growth 5Y1.35%
F-Score7
Asset Turnover1.23
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.36 | ||
| Debt/FCF | 1.67 | ||
| Debt/EBITDA | 0.85 | ||
| Cap/Depr | 85% | ||
| Cap/Sales | 2.34% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 66.18% | ||
| Profit Quality | 82.71% | ||
| Current Ratio | 1.86 | ||
| Quick Ratio | 1.15 | ||
| Altman-Z | N/A |
F-Score7
WACC11.03%
ROIC/WACC1.72
Cap/Depr(3y)102.18%
Cap/Depr(5y)102.09%
Cap/Sales(3y)2.81%
Cap/Sales(5y)3.06%
Profit Quality(3y)89.09%
Profit Quality(5y)97.8%
High Growth Momentum
Growth
EPS 1Y (TTM)13.55%
EPS 3Y13.81%
EPS 5Y9.03%
EPS Q2Q%2.47%
EPS Next Y7.2%
EPS Next 2Y8.46%
EPS Next 3Y8.48%
EPS Next 5Y7.14%
Revenue 1Y (TTM)4.46%
Revenue growth 3Y7.91%
Revenue growth 5Y4.74%
Sales Q2Q%-0.76%
Revenue Next Year129.35%
Revenue Next 2Y78.32%
Revenue Next 3Y48.61%
Revenue Next 5Y62.6%
EBIT growth 1Y10.44%
EBIT growth 3Y11.95%
EBIT growth 5Y7.13%
EBIT Next Year-11.21%
EBIT Next 3Y12.78%
EBIT Next 5Y9.79%
FCF growth 1Y21.8%
FCF growth 3Y5.87%
FCF growth 5Y15.84%
OCF growth 1Y9.48%
OCF growth 3Y7.01%
OCF growth 5Y7.33%