DONALDSON CO INC (DCI) Stock Fundamental Analysis
NYSE:DCI - New York Stock Exchange, Inc. - US2576511099 - Common Stock - Currency: USD
Overall DCI gets a fundamental rating of 7 out of 10. We evaluated DCI against 128 industry peers in the Machinery industry. Both the health and profitability get an excellent rating, making DCI a very profitable company, without any liquidiy or solvency issues. DCI has a decent growth rate and is not valued too expensively.
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's Return On Assets of 12.09% is amongst the best of the industry. DCI outperforms 87.50% of its industry peers.
DCI has a better Return On Equity (24.75%) than 89.84% of its industry peers.
Looking at the Return On Invested Capital, with a value of 18.57%, DCI belongs to the top of the industry, outperforming 92.97% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for DCI is significantly above the industry average of 10.69%.
The 3 year average ROIC (18.29%) for DCI is below the current ROIC(18.57%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 12.09% | ||
| ROE | 24.75% | ||
| ROIC | 18.57% |
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's Profit Margin of 9.94% is fine compared to the rest of the industry. DCI outperforms 68.75% 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 15.36%, DCI is doing good in the industry, outperforming 72.66% of the companies in the same industry.
DCI's Operating Margin has improved in the last couple of years.
DCI has a Gross Margin of 35.39%. This is in the better half of the industry: DCI outperforms 63.28% 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 | 15.36% | ||
| PM (TTM) | 9.94% | ||
| GM | 35.39% |
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
DCI has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
The number of shares outstanding for DCI has been reduced compared to 1 year ago.
The number of shares outstanding for DCI has been reduced compared to 5 years ago.
DCI has a better debt/assets ratio than last year.
2.2 Solvency
DCI has an Altman-Z score of 6.67. This indicates that DCI is financially healthy and has little risk of bankruptcy at the moment.
With an excellent Altman-Z score value of 6.67, DCI belongs to the best of the industry, outperforming 85.94% of the companies in the same industry.
DCI has a debt to FCF ratio of 2.42. This is a good value and a sign of high solvency as DCI would need 2.42 years to pay back of all of its debts.
The Debt to FCF ratio of DCI (2.42) is better than 70.31% of its industry peers.
A Debt/Equity ratio of 0.49 indicates that DCI is not too dependend on debt financing.
DCI has a Debt to Equity ratio of 0.49. This is comparable to the rest of the industry: DCI outperforms 44.53% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.49 | ||
| Debt/FCF | 2.42 | ||
| Altman-Z | 6.67 |
ROIC/WACC1.9
WACC9.75%
2.3 Liquidity
A Current Ratio of 1.94 indicates that DCI should not have too much problems paying its short term obligations.
DCI's Current ratio of 1.94 is in line compared to the rest of the industry. DCI outperforms 46.88% of its industry peers.
DCI has a Quick Ratio of 1.24. 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 (1.24) which is in line with its industry peers.
DCI does not score too well on the current and quick ratio evaluation. However, as it has excellent solvency and profitability, these ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.94 | ||
| Quick Ratio | 1.24 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 10.12% over the past year.
The Earnings Per Share has been growing by 9.03% on average over the past years. This is quite good.
Looking at the last year, DCI shows a small growth in Revenue. The Revenue has grown by 3.26% in the last year.
DCI shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 4.74% yearly.
EPS 1Y (TTM)10.12%
EPS 3Y13.81%
EPS 5Y9.03%
EPS Q2Q%7.61%
Revenue 1Y (TTM)3.26%
Revenue growth 3Y7.91%
Revenue growth 5Y4.74%
Sales Q2Q%1.31%
3.2 Future
The Earnings Per Share is expected to grow by 6.87% on average over the next years.
DCI is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 4.06% yearly.
EPS Next Y7.98%
EPS Next 2Y6.79%
EPS Next 3Y7.31%
EPS Next 5Y6.87%
Revenue Next Year1.9%
Revenue Next 2Y2.65%
Revenue Next 3Y3.52%
Revenue Next 5Y4.06%
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 19.65, DCI is valued on the expensive side.
DCI's Price/Earnings ratio is a bit cheaper when compared to the industry. DCI is cheaper than 67.97% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 27.30, DCI is valued a bit cheaper.
The Price/Forward Earnings ratio is 18.09, which indicates a rather expensive current 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 64.06% of the companies listed in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 21.76, DCI is valued at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.65 | ||
| Fwd PE | 18.09 |
4.2 Price Multiples
DCI's Enterprise Value to EBITDA ratio is in line with the industry average.
DCI's Price/Free Cash Flow is on the same level as the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 28.24 | ||
| EV/EBITDA | 13.67 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
DCI has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)2.46
PEG (5Y)2.18
EPS Next 2Y6.79%
EPS Next 3Y7.31%
5. Dividend
5.1 Amount
DCI has a Yearly Dividend Yield of 1.68%.
DCI's Dividend Yield is a higher than the industry average which is at 1.81.
Compared to the average S&P500 Dividend Yield of 2.37, DCI is paying slightly less dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.68% |
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 their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)5.51%
Div Incr Years29
Div Non Decr Years34
5.3 Sustainability
35.71% of the earnings are spent on dividend by DCI. This is a low number and sustainable payout ratio.
The dividend of DCI is growing, but earnings are growing more, so the dividend growth is sustainable.
DP35.71%
EPS Next 2Y6.79%
EPS Next 3Y7.31%
70.56
-1.06 (-1.48%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryMachinery
Earnings (Last)
Earnings (Next)
Inst Owners91.04%
Inst Owner Change0.26%
Ins Owners0.49%
Ins Owner Change0.19%
Market Cap8.43B
Analysts52.86
Price Target74.21 (5.17%)
Short Float %2.13%
Short Ratio4.75
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.68% |
Yearly Dividend1.02
Dividend Growth(5Y)5.51%
DP35.71%
Div Incr Years29
Div Non Decr Years34
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)0.23%
Min EPS beat(2)-3.03%
Max EPS beat(2)3.49%
EPS beat(4)3
Avg EPS beat(4)1.42%
Min EPS beat(4)-3.03%
Max EPS beat(4)5.16%
EPS beat(8)6
Avg EPS beat(8)3.26%
EPS beat(12)8
Avg EPS beat(12)2.11%
EPS beat(16)9
Avg EPS beat(16)1.09%
Revenue beat(2)0
Avg Revenue beat(2)-2.73%
Min Revenue beat(2)-5.17%
Max Revenue beat(2)-0.28%
Revenue beat(4)1
Avg Revenue beat(4)-1.74%
Min Revenue beat(4)-5.17%
Max Revenue beat(4)0.25%
Revenue beat(8)2
Avg Revenue beat(8)-1.51%
Revenue beat(12)4
Avg Revenue beat(12)-0.98%
Revenue beat(16)7
Avg Revenue beat(16)-0.34%
PT rev (1m)4.3%
PT rev (3m)-2.48%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-0.09%
EPS NY rev (1m)1.39%
EPS NY rev (3m)0.58%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-0.84%
Revenue NY rev (1m)0.27%
Revenue NY rev (3m)-0.35%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.65 | ||
| Fwd PE | 18.09 | ||
| P/S | 2.31 | ||
| P/FCF | 28.24 | ||
| P/OCF | 22.37 | ||
| P/B | 5.76 | ||
| P/tB | 9.66 | ||
| EV/EBITDA | 13.67 |
EPS(TTM)3.59
EY5.09%
EPS(NY)3.9
Fwd EY5.53%
FCF(TTM)2.5
FCFY3.54%
OCF(TTM)3.15
OCFY4.47%
SpS30.5
BVpS12.25
TBVpS7.3
PEG (NY)2.46
PEG (5Y)2.18
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 12.09% | ||
| ROE | 24.75% | ||
| ROCE | 25.04% | ||
| ROIC | 18.57% | ||
| ROICexc | 20.12% | ||
| ROICexgc | 27.8% | ||
| OM | 15.36% | ||
| PM (TTM) | 9.94% | ||
| GM | 35.39% | ||
| FCFM | 8.19% |
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-Score6
Asset Turnover1.22
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.49 | ||
| Debt/FCF | 2.42 | ||
| Debt/EBITDA | 1.09 | ||
| Cap/Depr | 78.4% | ||
| Cap/Sales | 2.15% | ||
| Interest Coverage | 27.59 | ||
| Cash Conversion | 57.12% | ||
| Profit Quality | 82.4% | ||
| Current Ratio | 1.94 | ||
| Quick Ratio | 1.24 | ||
| Altman-Z | 6.67 |
F-Score6
WACC9.75%
ROIC/WACC1.9
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)10.12%
EPS 3Y13.81%
EPS 5Y9.03%
EPS Q2Q%7.61%
EPS Next Y7.98%
EPS Next 2Y6.79%
EPS Next 3Y7.31%
EPS Next 5Y6.87%
Revenue 1Y (TTM)3.26%
Revenue growth 3Y7.91%
Revenue growth 5Y4.74%
Sales Q2Q%1.31%
Revenue Next Year1.9%
Revenue Next 2Y2.65%
Revenue Next 3Y3.52%
Revenue Next 5Y4.06%
EBIT growth 1Y8%
EBIT growth 3Y11.95%
EBIT growth 5Y7.13%
EBIT Next Year26.06%
EBIT Next 3Y9.82%
EBIT Next 5Y9.16%
FCF growth 1Y-12.46%
FCF growth 3Y5.87%
FCF growth 5Y15.84%
OCF growth 1Y-18.5%
OCF growth 3Y7.01%
OCF growth 5Y7.33%