INGERSOLL-RAND INC (IR) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:IR - US45687V1061 - Common Stock
86.27 USD
-0.52 (-0.6%)
86.27 USD
0 (0%)
IR gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 132 industry peers in the Machinery industry. While IR belongs to the best of the industry regarding profitability, there are some minor concerns on its financial health. While showing a medium growth rate, IR is valued expensive at the moment.
1. Profitability
1.1 Basic Checks
- In the past year IR was profitable.
- IR had a positive operating cash flow in the past year.
- Of the past 5 years IR 4 years were profitable.
- In the past 5 years IR always reported a positive cash flow from operatings.
1.2 Ratios
- IR has a Return On Assets (2.97%) which is comparable to the rest of the industry.
- IR has a Return On Equity of 5.34%. This is comparable to the rest of the industry: IR outperforms 44.70% of its industry peers.
- IR has a Return On Invested Capital (6.95%) which is comparable to the rest of the industry.
- Measured over the past 3 years, the Average Return On Invested Capital for IR is below the industry average of 10.24%.
- The last Return On Invested Capital (6.95%) for IR is above the 3 year average (6.33%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.97% | ||
| ROE | 5.34% | ||
| ROIC | 6.95% |
ROA(3y)4.58%
ROA(5y)3.45%
ROE(3y)7.59%
ROE(5y)5.73%
ROIC(3y)6.33%
ROIC(5y)4.79%
1.3 Margins
- IR has a Profit Margin of 7.25%. This is in the better half of the industry: IR outperforms 63.64% of its industry peers.
- In the last couple of years the Profit Margin of IR has grown nicely.
- The Operating Margin of IR (19.75%) is better than 88.64% of its industry peers.
- IR's Operating Margin has improved in the last couple of years.
- The Gross Margin of IR (43.72%) is better than 81.82% of its industry peers.
- In the last couple of years the Gross Margin of IR has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 19.75% | ||
| PM (TTM) | 7.25% | ||
| GM | 43.72% |
OM growth 3Y18.5%
OM growth 5Y9.27%
PM growth 3Y2.02%
PM growth 5Y8.01%
GM growth 3Y4.32%
GM growth 5Y2.58%
2. Health
2.1 Basic Checks
- With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), IR is destroying value.
- Compared to 1 year ago, IR has about the same amount of shares outstanding.
- Compared to 5 years ago, IR has more shares outstanding
- The debt/assets ratio for IR is higher compared to a year ago.
2.2 Solvency
- IR has an Altman-Z score of 3.58. This indicates that IR is financially healthy and has little risk of bankruptcy at the moment.
- IR's Altman-Z score of 3.58 is in line compared to the rest of the industry. IR outperforms 59.85% of its industry peers.
- The Debt to FCF ratio of IR is 3.83, which is a good value as it means it would take IR, 3.83 years of fcf income to pay off all of its debts.
- With a decent Debt to FCF ratio value of 3.83, IR is doing good in the industry, outperforming 61.36% of the companies in the same industry.
- IR has a Debt/Equity ratio of 0.47. This is a healthy value indicating a solid balance between debt and equity.
- IR has a Debt to Equity ratio (0.47) which is in line with its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.47 | ||
| Debt/FCF | 3.83 | ||
| Altman-Z | 3.58 |
ROIC/WACC0.73
WACC9.5%
2.3 Liquidity
- IR has a Current Ratio of 2.16. This indicates that IR is financially healthy and has no problem in meeting its short term obligations.
- IR's Current ratio of 2.16 is in line compared to the rest of the industry. IR outperforms 57.58% of its industry peers.
- IR has a Quick Ratio of 1.51. This is a normal value and indicates that IR is financially healthy and should not expect problems in meeting its short term obligations.
- IR has a better Quick ratio (1.51) than 65.15% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.16 | ||
| Quick Ratio | 1.51 |
3. Growth
3.1 Past
- The earnings per share for IR have decreased by -2.72% in the last year.
- Measured over the past years, IR shows a quite strong growth in Earnings Per Share. The EPS has been growing by 15.65% on average per year.
- The Revenue has been growing slightly by 4.20% in the past year.
- The Revenue has been growing by 29.10% on average over the past years. This is a very strong growth!
EPS 1Y (TTM)-2.72%
EPS 3Y15.06%
EPS 5Y15.65%
EPS Q2Q%2.38%
Revenue 1Y (TTM)4.2%
Revenue growth 3Y11.98%
Revenue growth 5Y29.1%
Sales Q2Q%5.05%
3.2 Future
- IR is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 10.57% yearly.
- IR is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 6.58% yearly.
EPS Next Y2.85%
EPS Next 2Y5.6%
EPS Next 3Y7.1%
EPS Next 5Y10.57%
Revenue Next Year4.78%
Revenue Next 2Y4.67%
Revenue Next 3Y4.86%
Revenue Next 5Y6.58%
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.
- When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
- Based on the Price/Earnings ratio of 26.79, the valuation of IR can be described as expensive.
- The rest of the industry has a similar Price/Earnings ratio as IR.
- IR is valuated at similar levels of the S&P average when we compare the Price/Earnings ratio to 28.87, which is the current average of the S&P500 Index.
- IR is valuated rather expensively with a Price/Forward Earnings ratio of 23.52.
- IR's Price/Forward Earnings ratio is in line with the industry average.
- When comparing the Price/Forward Earnings ratio of IR to the average of the S&P500 Index (25.96), we can say IR is valued inline with the index average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 26.79 | ||
| Fwd PE | 23.52 |
4.2 Price Multiples
- IR's Enterprise Value to EBITDA is on the same level as the industry average.
- The rest of the industry has a similar Price/Free Cash Flow ratio as IR.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 27.28 | ||
| EV/EBITDA | 19.22 |
4.3 Compensation for Growth
- The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates IR does not grow enough to justify the current Price/Earnings ratio.
- IR has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)9.41
PEG (5Y)1.71
EPS Next 2Y5.6%
EPS Next 3Y7.1%
5. Dividend
5.1 Amount
- With a yearly dividend of 0.09%, IR is not a good candidate for dividend investing.
- Compared to an average industry Dividend Yield of 1.01, IR has a dividend in line with its industry peers.
- With a Dividend Yield of 0.09, IR pays less dividend than the S&P500 average, which is at 1.82.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.09% |
5.2 History
- IR has been paying a dividend for at least 10 years, so it has a reliable track record.
Dividend Growth(5Y)N/A
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
- 5.93% of the earnings are spent on dividend by IR. This is a low number and sustainable payout ratio.
DP5.93%
EPS Next 2Y5.6%
EPS Next 3Y7.1%
INGERSOLL-RAND INC / IR FAQ
What is the fundamental rating for IR stock?
ChartMill assigns a fundamental rating of 5 / 10 to IR.
Can you provide the valuation status for INGERSOLL-RAND INC?
ChartMill assigns a valuation rating of 2 / 10 to INGERSOLL-RAND INC (IR). This can be considered as Overvalued.
How profitable is INGERSOLL-RAND INC (IR) stock?
INGERSOLL-RAND INC (IR) has a profitability rating of 7 / 10.
Can you provide the PE and PB ratios for IR stock?
The Price/Earnings (PE) ratio for INGERSOLL-RAND INC (IR) is 26.79 and the Price/Book (PB) ratio is 3.37.
What is the earnings growth outlook for INGERSOLL-RAND INC?
The Earnings per Share (EPS) of INGERSOLL-RAND INC (IR) is expected to grow by 2.85% in the next year.