GRIFFON CORP (GFF) Stock Fundamental Analysis
NYSE:GFF - New York Stock Exchange, Inc. - US3984331021 - Common Stock - Currency: USD
We assign a fundamental rating of 5 out of 10 to GFF. GFF was compared to 40 industry peers in the Building Products industry. GFF has an excellent profitability rating, but there are some minor concerns on its financial health. GFF scores decently on growth, while it is valued quite cheap. This could make an interesting combination.
1. Profitability
1.1 Basic Checks
GFF had positive earnings in the past year.
GFF had a positive operating cash flow in the past year.
GFF had positive earnings in 4 of the past 5 years.
In the past 5 years GFF always reported a positive cash flow from operatings.
1.2 Ratios
GFF has a Return On Assets of 10.26%. This is in the better half of the industry: GFF outperforms 62.50% of its industry peers.
GFF has a better Return On Equity (104.74%) than 100.00% of its industry peers.
Looking at the Return On Invested Capital, with a value of 16.15%, GFF is in the better half of the industry, outperforming 75.00% of the companies in the same industry.
GFF had an Average Return On Invested Capital over the past 3 years of 13.01%. This is in line with the industry average of 13.20%.
The 3 year average ROIC (13.01%) for GFF is below the current ROIC(16.15%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 10.26% | ||
| ROE | 104.74% | ||
| ROIC | 16.15% |
ROA(3y)1.75%
ROA(5y)2.1%
ROE(3y)25.95%
ROE(5y)19.05%
ROIC(3y)13.01%
ROIC(5y)10.16%
1.3 Margins
With a Profit Margin value of 9.13%, GFF perfoms like the industry average, outperforming 50.00% of the companies in the same industry.
GFF's Profit Margin has improved in the last couple of years.
The Operating Margin of GFF (17.43%) is better than 62.50% of its industry peers.
In the last couple of years the Operating Margin of GFF has grown nicely.
The Gross Margin of GFF (41.02%) is better than 77.50% of its industry peers.
In the last couple of years the Gross Margin of GFF has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 17.43% | ||
| PM (TTM) | 9.13% | ||
| GM | 41.02% |
OM growth 3Y25.65%
OM growth 5Y23.71%
PM growth 3Y31.88%
PM growth 5Y32.08%
GM growth 3Y12.08%
GM growth 5Y7.85%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so GFF is still creating some value.
GFF has less shares outstanding than it did 1 year ago.
GFF has more shares outstanding than it did 5 years ago.
Compared to 1 year ago, GFF has a worse debt to assets ratio.
2.2 Solvency
GFF has an Altman-Z score of 3.38. This indicates that GFF is financially healthy and has little risk of bankruptcy at the moment.
GFF has a Altman-Z score of 3.38. This is comparable to the rest of the industry: GFF outperforms 47.50% of its industry peers.
GFF has a debt to FCF ratio of 4.83. This is a neutral value as GFF would need 4.83 years to pay back of all of its debts.
The Debt to FCF ratio of GFF (4.83) is worse than 65.00% of its industry peers.
A Debt/Equity ratio of 6.44 is on the high side and indicates that GFF has dependencies on debt financing.
The Debt to Equity ratio of GFF (6.44) is worse than 92.50% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 6.44 | ||
| Debt/FCF | 4.83 | ||
| Altman-Z | 3.38 |
ROIC/WACC1.6
WACC10.1%
2.3 Liquidity
GFF has a Current Ratio of 2.51. This indicates that GFF is financially healthy and has no problem in meeting its short term obligations.
GFF has a Current ratio (2.51) which is in line with its industry peers.
GFF has a Quick Ratio of 1.34. This is a normal value and indicates that GFF is financially healthy and should not expect problems in meeting its short term obligations.
Looking at the Quick ratio, with a value of 1.34, GFF is in line with its industry, outperforming 57.50% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.51 | ||
| Quick Ratio | 1.34 |
3. Growth
3.1 Past
GFF shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 14.50%, which is quite good.
Measured over the past years, GFF shows a very strong growth in Earnings Per Share. The EPS has been growing by 36.56% on average per year.
The Revenue has decreased by -2.47% in the past year.
Measured over the past years, GFF shows a small growth in Revenue. The Revenue has been growing by 6.96% on average per year.
EPS 1Y (TTM)14.5%
EPS 3Y39.99%
EPS 5Y36.56%
EPS Q2Q%29.91%
Revenue 1Y (TTM)-2.47%
Revenue growth 3Y4.93%
Revenue growth 5Y6.96%
Sales Q2Q%-1.68%
3.2 Future
Based on estimates for the next years, GFF will show a quite strong growth in Earnings Per Share. The EPS will grow by 14.51% on average per year.
The Revenue is expected to grow by 1.86% on average over the next years.
EPS Next Y10.88%
EPS Next 2Y14.51%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue Next Year0.65%
Revenue Next 2Y1.86%
Revenue Next 3YN/A
Revenue Next 5YN/A
3.3 Evolution
Although the future EPS growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 13.32, GFF is valued correctly.
Based on the Price/Earnings ratio, GFF is valued a bit cheaper than 77.50% of the companies in the same industry.
GFF's Price/Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 29.63.
The Price/Forward Earnings ratio is 10.79, which indicates a very decent valuation of GFF.
Compared to the rest of the industry, the Price/Forward Earnings ratio of GFF indicates a somewhat cheap valuation: GFF is cheaper than 80.00% of the companies listed in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 22.68, GFF is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.32 | ||
| Fwd PE | 10.79 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, GFF is valued a bit cheaper than the industry average as 75.00% of the companies are valued more expensively.
82.50% of the companies in the same industry are more expensive than GFF, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 11.3 | ||
| EV/EBITDA | 9.45 |
4.3 Compensation for Growth
The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
GFF has a very decent profitability rating, which may justify a higher PE ratio.
A more expensive valuation may be justified as GFF's earnings are expected to grow with 14.51% in the coming years.
PEG (NY)1.22
PEG (5Y)0.36
EPS Next 2Y14.51%
EPS Next 3YN/A
5. Dividend
5.1 Amount
With a yearly dividend of 0.96%, GFF is not a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 1.11, GFF pays a bit more dividend than its industry peers.
With a Dividend Yield of 0.96, GFF pays less dividend than the S&P500 average, which is at 2.27.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.96% |
5.2 History
The dividend of GFF is nicely growing with an annual growth rate of 18.06%!
GFF has paid a dividend for at least 10 years, which is a reliable track record.
GFF has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)18.06%
Div Incr Years12
Div Non Decr Years12
5.3 Sustainability
GFF pays out 14.62% of its income as dividend. This is a sustainable payout ratio.
GFF's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP14.62%
EPS Next 2Y14.51%
EPS Next 3YN/A
72.6
-2.4 (-3.2%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryBuilding Products
Earnings (Last)
Earnings (Next)
Inst Owners80.39%
Inst Owner Change2.3%
Ins Owners10.52%
Ins Owner Change-10.53%
Market Cap3.45B
Analysts88.89
Price Target104.65 (44.15%)
Short Float %6.32%
Short Ratio7.02
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.96% |
Yearly Dividend0.68
Dividend Growth(5Y)18.06%
DP14.62%
Div Incr Years12
Div Non Decr Years12
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)19.41%
Min EPS beat(2)15.26%
Max EPS beat(2)23.55%
EPS beat(4)3
Avg EPS beat(4)22.84%
Min EPS beat(4)-6.57%
Max EPS beat(4)59.12%
EPS beat(8)7
Avg EPS beat(8)34.71%
EPS beat(12)11
Avg EPS beat(12)54.27%
EPS beat(16)14
Avg EPS beat(16)55.48%
Revenue beat(2)1
Avg Revenue beat(2)-0.01%
Min Revenue beat(2)-1.87%
Max Revenue beat(2)1.86%
Revenue beat(4)2
Avg Revenue beat(4)-0.29%
Min Revenue beat(4)-6.9%
Max Revenue beat(4)5.75%
Revenue beat(8)3
Avg Revenue beat(8)-0.36%
Revenue beat(12)4
Avg Revenue beat(12)0.26%
Revenue beat(16)5
Avg Revenue beat(16)-3.42%
PT rev (1m)0%
PT rev (3m)13.48%
EPS NQ rev (1m)-5.49%
EPS NQ rev (3m)-20.14%
EPS NY rev (1m)1.77%
EPS NY rev (3m)0.82%
Revenue NQ rev (1m)-4.29%
Revenue NQ rev (3m)-9.75%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-1.45%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.32 | ||
| Fwd PE | 10.79 | ||
| P/S | 1.32 | ||
| P/FCF | 11.3 | ||
| P/OCF | 9.16 | ||
| P/B | 15.15 | ||
| P/tB | N/A | ||
| EV/EBITDA | 9.45 |
EPS(TTM)5.45
EY7.51%
EPS(NY)6.73
Fwd EY9.27%
FCF(TTM)6.42
FCFY8.85%
OCF(TTM)7.93
OCFY10.92%
SpS54.97
BVpS4.79
TBVpS-14.96
PEG (NY)1.22
PEG (5Y)0.36
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 10.26% | ||
| ROE | 104.74% | ||
| ROCE | 23.13% | ||
| ROIC | 16.15% | ||
| ROICexc | 17.5% | ||
| ROICexgc | 36.19% | ||
| OM | 17.43% | ||
| PM (TTM) | 9.13% | ||
| GM | 41.02% | ||
| FCFM | 11.69% |
ROA(3y)1.75%
ROA(5y)2.1%
ROE(3y)25.95%
ROE(5y)19.05%
ROIC(3y)13.01%
ROIC(5y)10.16%
ROICexc(3y)13.73%
ROICexc(5y)10.9%
ROICexgc(3y)27.02%
ROICexgc(5y)20.88%
ROCE(3y)18.64%
ROCE(5y)14.56%
ROICexcg growth 3Y35.8%
ROICexcg growth 5Y28.19%
ROICexc growth 3Y29.9%
ROICexc growth 5Y27.94%
OM growth 3Y25.65%
OM growth 5Y23.71%
PM growth 3Y31.88%
PM growth 5Y32.08%
GM growth 3Y12.08%
GM growth 5Y7.85%
F-Score8
Asset Turnover1.12
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 6.44 | ||
| Debt/FCF | 4.83 | ||
| Debt/EBITDA | 2.84 | ||
| Cap/Depr | 116.31% | ||
| Cap/Sales | 2.74% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 72.9% | ||
| Profit Quality | 127.99% | ||
| Current Ratio | 2.51 | ||
| Quick Ratio | 1.34 | ||
| Altman-Z | 3.38 |
F-Score8
WACC10.1%
ROIC/WACC1.6
Cap/Depr(3y)91.87%
Cap/Depr(5y)85.09%
Cap/Sales(3y)2.16%
Cap/Sales(5y)2.02%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)14.5%
EPS 3Y39.99%
EPS 5Y36.56%
EPS Q2Q%29.91%
EPS Next Y10.88%
EPS Next 2Y14.51%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue 1Y (TTM)-2.47%
Revenue growth 3Y4.93%
Revenue growth 5Y6.96%
Sales Q2Q%-1.68%
Revenue Next Year0.65%
Revenue Next 2Y1.86%
Revenue Next 3YN/A
Revenue Next 5YN/A
EBIT growth 1Y10.08%
EBIT growth 3Y31.85%
EBIT growth 5Y32.32%
EBIT Next Year28.3%
EBIT Next 3YN/A
EBIT Next 5YN/A
FCF growth 1Y66.49%
FCF growth 3Y60.43%
FCF growth 5Y32.06%
OCF growth 1Y71.31%
OCF growth 3Y49.99%
OCF growth 5Y27.54%