ILLINOIS TOOL WORKS (ILT.DE) Stock Fundamental Analysis
Europe - Frankfurt Stock Exchange - FRA:ILT - US4523081093 - Common Stock
217 EUR
-2.2 (-1%)
We assign a fundamental rating of 6 out of 10 to ILT. ILT was compared to 111 industry peers in the Machinery industry. While ILT has a great profitability rating, there are some minor concerns on its financial health. While showing a medium growth rate, ILT is valued expensive at the moment. Finally ILT also has an excellent dividend rating. With these ratings, ILT could be worth investigating further for dividend investing!.
1. Profitability
1.1 Basic Checks
- In the past year ILT was profitable.
- In the past year ILT had a positive cash flow from operations.
- Each year in the past 5 years ILT has been profitable.
- In the past 5 years ILT always reported a positive cash flow from operatings.
1.2 Ratios
- ILT has a Return On Assets of 18.75%. This is amongst the best in the industry. ILT outperforms 98.20% of its industry peers.
- Looking at the Return On Equity, with a value of 94.33%, ILT belongs to the top of the industry, outperforming 100.00% of the companies in the same industry.
- ILT's Return On Invested Capital of 24.44% is amongst the best of the industry. ILT outperforms 95.50% of its industry peers.
- Measured over the past 3 years, the Average Return On Invested Capital for ILT is significantly above the industry average of 9.21%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 18.75% | ||
| ROE | 94.33% | ||
| ROIC | 24.44% |
ROA(3y)20.63%
ROA(5y)18.43%
ROE(3y)100.54%
ROE(5y)88.45%
ROIC(3y)27.14%
ROIC(5y)23.98%
1.3 Margins
- The Profit Margin of ILT (19.05%) is better than 98.20% of its industry peers.
- In the last couple of years the Profit Margin of ILT has grown nicely.
- ILT has a better Operating Margin (26.20%) than 97.30% of its industry peers.
- In the last couple of years the Operating Margin of ILT has grown nicely.
- Looking at the Gross Margin, with a value of 43.93%, ILT is in line with its industry, outperforming 54.05% of the companies in the same industry.
- In the last couple of years the Gross Margin of ILT has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 26.2% | ||
| PM (TTM) | 19.05% | ||
| GM | 43.93% |
OM growth 3Y3.7%
OM growth 5Y2.15%
PM growth 3Y5.59%
PM growth 5Y4.19%
GM growth 3Y2.37%
GM growth 5Y1.08%
2. Health
2.1 Basic Checks
- The Return on Invested Capital (ROIC) is well above the Cost of Capital (WACC), so ILT is creating value.
- Compared to 1 year ago, ILT has less shares outstanding
- ILT has less shares outstanding than it did 5 years ago.
- Compared to 1 year ago, ILT has an improved debt to assets ratio.
2.2 Solvency
- ILT has an Altman-Z score of 8.04. This indicates that ILT is financially healthy and has little risk of bankruptcy at the moment.
- The Altman-Z score of ILT (8.04) is better than 96.40% of its industry peers.
- ILT has a debt to FCF ratio of 3.14. This is a good value and a sign of high solvency as ILT would need 3.14 years to pay back of all of its debts.
- ILT's Debt to FCF ratio of 3.14 is fine compared to the rest of the industry. ILT outperforms 66.67% of its industry peers.
- ILT has a Debt/Equity ratio of 2.80. This is a high value indicating a heavy dependency on external financing.
- The Debt to Equity ratio of ILT (2.80) is worse than 90.99% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.8 | ||
| Debt/FCF | 3.14 | ||
| Altman-Z | 8.04 |
ROIC/WACC2.63
WACC9.3%
2.3 Liquidity
- ILT has a Current Ratio of 1.53. This is a normal value and indicates that ILT is financially healthy and should not expect problems in meeting its short term obligations.
- ILT has a Current ratio (1.53) which is comparable to the rest of the industry.
- A Quick Ratio of 1.11 indicates that ILT should not have too much problems paying its short term obligations.
- With a decent Quick ratio value of 1.11, ILT is doing good in the industry, outperforming 63.06% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.53 | ||
| Quick Ratio | 1.11 |
3. Growth
3.1 Past
- The Earnings Per Share has been growing slightly by 2.59% over the past year.
- Measured over the past 5 years, ILT shows a small growth in Earnings Per Share. The EPS has been growing by 5.34% on average per year.
- Looking at the last year, ILT shows a decrease in Revenue. The Revenue has decreased by -0.41% in the last year.
- Measured over the past years, ILT shows a small growth in Revenue. The Revenue has been growing by 2.42% on average per year.
EPS 1Y (TTM)2.59%
EPS 3Y7.79%
EPS 5Y5.34%
EPS Q2Q%6.04%
Revenue 1Y (TTM)-0.41%
Revenue growth 3Y3.22%
Revenue growth 5Y2.42%
Sales Q2Q%2.34%
3.2 Future
- Based on estimates for the next years, ILT will show a quite strong growth in Earnings Per Share. The EPS will grow by 9.58% on average per year.
- Based on estimates for the next years, ILT will show a small growth in Revenue. The Revenue will grow by 3.85% on average per year.
EPS Next Y3.83%
EPS Next 2Y5.75%
EPS Next 3Y6.23%
EPS Next 5Y9.58%
Revenue Next Year0.33%
Revenue Next 2Y1.82%
Revenue Next 3Y2.34%
Revenue Next 5Y3.85%
3.3 Evolution
- The EPS growth rate is accelerating: in the next years the growth will be better 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 24.91, ILT is valued on the expensive side.
- The rest of the industry has a similar Price/Earnings ratio as ILT.
- The average S&P500 Price/Earnings ratio is at 27.25. ILT is around the same levels.
- Based on the Price/Forward Earnings ratio of 22.58, the valuation of ILT can be described as rather expensive.
- ILT's Price/Forward Earnings ratio is a bit more expensive when compared to the industry. ILT is more expensive than 62.16% of the companies in the same industry.
- ILT is valuated at similar levels of the S&P average when we compare the Price/Forward Earnings ratio to 25.98, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 24.91 | ||
| Fwd PE | 22.58 |
4.2 Price Multiples
- ILT's Enterprise Value to EBITDA ratio is a bit more expensive when compared to the industry. ILT is more expensive than 69.37% of the companies in the same industry.
- ILT's Price/Free Cash Flow is on the same level as the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 26.19 | ||
| EV/EBITDA | 17.82 |
4.3 Compensation for Growth
- The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates ILT does not grow enough to justify the current Price/Earnings ratio.
- ILT has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)6.5
PEG (5Y)4.66
EPS Next 2Y5.75%
EPS Next 3Y6.23%
5. Dividend
5.1 Amount
- ILT has a Yearly Dividend Yield of 2.48%. Purely for dividend investing, there may be better candidates out there.
- Compared to an average industry Dividend Yield of 1.48, ILT pays a better dividend. On top of this ILT pays more dividend than 81.98% of the companies listed in the same industry.
- ILT's Dividend Yield is a higher than the S&P500 average which is at 1.82.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.48% |
5.2 History
- On average, the dividend of ILT grows each year by 6.98%, which is quite nice.
Dividend Growth(5Y)6.98%
Div Incr Years3
Div Non Decr Years3
5.3 Sustainability
- 58.20% of the earnings are spent on dividend by ILT. This is a bit on the high side, but may be sustainable.
- ILT's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP58.2%
EPS Next 2Y5.75%
EPS Next 3Y6.23%
ILLINOIS TOOL WORKS / ILT.DE FAQ
What is the fundamental rating for ILT stock?
ChartMill assigns a fundamental rating of 6 / 10 to ILT.DE.
What is the valuation status of ILLINOIS TOOL WORKS (ILT.DE) stock?
ChartMill assigns a valuation rating of 2 / 10 to ILLINOIS TOOL WORKS (ILT.DE). This can be considered as Overvalued.
What is the profitability of ILT stock?
ILLINOIS TOOL WORKS (ILT.DE) has a profitability rating of 8 / 10.
Can you provide the PE and PB ratios for ILT stock?
The Price/Earnings (PE) ratio for ILLINOIS TOOL WORKS (ILT.DE) is 24.91 and the Price/Book (PB) ratio is 23.23.
Is the dividend of ILLINOIS TOOL WORKS sustainable?
The dividend rating of ILLINOIS TOOL WORKS (ILT.DE) is 7 / 10 and the dividend payout ratio is 58.2%.