INGERSOLL-RAND INC (IR) Stock Fundamental Analysis
NYSE:IR - New York Stock Exchange, Inc. - US45687V1061 - Common Stock - Currency: USD
Overall IR gets a fundamental rating of 5 out of 10. We evaluated IR against 128 industry peers in the Machinery industry. IR scores excellent on profitability, but there are some minor concerns on its financial health. IR is valied quite expensively at the moment, while it does show a decent growth rate.
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
Looking at the Return On Assets, with a value of 4.48%, IR is in line with its industry, outperforming 48.44% of the companies in the same industry.
Looking at the Return On Equity, with a value of 7.85%, IR is in line with its industry, outperforming 46.09% of the companies in the same industry.
IR has a Return On Invested Capital of 6.78%. This is comparable to the rest of the industry: IR outperforms 47.66% of its industry peers.
The Average Return On Invested Capital over the past 3 years for IR is below the industry average of 10.71%.
The last Return On Invested Capital (6.78%) for IR is above the 3 year average (6.33%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.48% | ||
| ROE | 7.85% | ||
| ROIC | 6.78% |
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
The Profit Margin of IR (11.30%) is better than 79.69% of its industry peers.
In the last couple of years the Profit Margin of IR has grown nicely.
The Operating Margin of IR (20.07%) is better than 89.06% of its industry peers.
IR's Operating Margin has improved in the last couple of years.
IR's Gross Margin of 43.80% is amongst the best of the industry. IR outperforms 80.47% of its industry peers.
In the last couple of years the Gross Margin of IR has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 20.07% | ||
| PM (TTM) | 11.3% | ||
| GM | 43.8% |
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
IR has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
The number of shares outstanding for IR remains at a similar level compared to 1 year ago.
IR has more shares outstanding than it did 5 years ago.
IR has a worse debt/assets ratio than last year.
2.2 Solvency
An Altman-Z score of 3.69 indicates that IR is not in any danger for bankruptcy at the moment.
IR's Altman-Z score of 3.69 is fine compared to the rest of the industry. IR outperforms 61.72% of its industry peers.
IR has a debt to FCF ratio of 3.48. This is a good value and a sign of high solvency as IR would need 3.48 years to pay back of all of its debts.
IR has a better Debt to FCF ratio (3.48) than 62.50% of its industry peers.
A Debt/Equity ratio of 0.45 indicates that IR is not too dependend on debt financing.
IR has a Debt to Equity ratio (0.45) which is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.45 | ||
| Debt/FCF | 3.48 | ||
| Altman-Z | 3.69 |
ROIC/WACC0.7
WACC9.75%
2.3 Liquidity
IR has a Current Ratio of 2.38. This indicates that IR is financially healthy and has no problem in meeting its short term obligations.
The Current ratio of IR (2.38) is better than 60.16% of its industry peers.
IR has a Quick Ratio of 1.76. 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 (1.76) than 73.44% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.38 | ||
| Quick Ratio | 1.76 |
3. Growth
3.1 Past
IR shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 4.53%.
IR shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 15.65% yearly.
IR shows a small growth in Revenue. In the last year, the Revenue has grown by 5.27%.
IR shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 29.10% yearly.
EPS 1Y (TTM)4.53%
EPS 3Y15.06%
EPS 5Y15.65%
EPS Q2Q%-7.69%
Revenue 1Y (TTM)5.27%
Revenue growth 3Y11.98%
Revenue growth 5Y29.1%
Sales Q2Q%2.8%
3.2 Future
Based on estimates for the next years, IR will show a quite strong growth in Earnings Per Share. The EPS will grow by 12.55% on average per year.
Based on estimates for the next years, IR will show a small growth in Revenue. The Revenue will grow by 8.00% on average per year.
EPS Next Y4.86%
EPS Next 2Y7.23%
EPS Next 3Y8.1%
EPS Next 5Y12.55%
Revenue Next Year3.54%
Revenue Next 2Y4.19%
Revenue Next 3Y4.64%
Revenue Next 5Y8%
3.3 Evolution
The EPS growth rate is stable: in the next years the growth will be about the same 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 decreasing.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 26.93, the valuation of IR can be described as expensive.
IR's Price/Earnings ratio is in line with the industry average.
When comparing the Price/Earnings ratio of IR to the average of the S&P500 Index (27.45), we can say IR is valued inline with the index average.
The Price/Forward Earnings ratio is 22.99, which indicates a rather expensive current valuation of IR.
Compared to the rest of the industry, the Price/Forward Earnings ratio of IR is on the same level as its industry peers.
When comparing the Price/Forward Earnings ratio of IR to the average of the S&P500 Index (21.90), we can say IR is valued inline with the index average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 26.93 | ||
| Fwd PE | 22.99 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, IR is valued a bit more expensive than the industry average as 62.50% of the companies are valued more cheaply.
IR's Price/Free Cash Flow ratio is in line with the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 25.6 | ||
| EV/EBITDA | 19.66 |
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)5.54
PEG (5Y)1.72
EPS Next 2Y7.23%
EPS Next 3Y8.1%
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 1.87, IR has a dividend in line with its industry peers.
Compared to an average S&P500 Dividend Yield of 2.42, IR's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.09% |
5.2 History
IR has paid a dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)N/A
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
3.93% of the earnings are spent on dividend by IR. This is a low number and sustainable payout ratio.
DP3.93%
EPS Next 2Y7.23%
EPS Next 3Y8.1%
86.98
+0.43 (+0.5%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryMachinery
Earnings (Last)
Earnings (Next)
Inst Owners99.82%
Inst Owner Change-0.24%
Ins Owners0.17%
Ins Owner Change7.79%
Market Cap35.09B
Analysts77.6
Price Target91.41 (5.09%)
Short Float %3.01%
Short Ratio4.03
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.09% |
Yearly Dividend0.08
Dividend Growth(5Y)N/A
DP3.93%
Div Incr Years0
Div Non Decr Years0
Ex-Date
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-3.98%
Min EPS beat(2)-4.75%
Max EPS beat(2)-3.21%
EPS beat(4)2
Avg EPS beat(4)-1.17%
Min EPS beat(4)-4.75%
Max EPS beat(4)3.04%
EPS beat(8)6
Avg EPS beat(8)4.06%
EPS beat(12)10
Avg EPS beat(12)5.65%
EPS beat(16)14
Avg EPS beat(16)6.75%
Revenue beat(2)0
Avg Revenue beat(2)-3.39%
Min Revenue beat(2)-3.44%
Max Revenue beat(2)-3.33%
Revenue beat(4)0
Avg Revenue beat(4)-3.26%
Min Revenue beat(4)-3.58%
Max Revenue beat(4)-2.68%
Revenue beat(8)2
Avg Revenue beat(8)-1.82%
Revenue beat(12)6
Avg Revenue beat(12)-0.28%
Revenue beat(16)9
Avg Revenue beat(16)-0.14%
PT rev (1m)-0.63%
PT rev (3m)-10.71%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-4.32%
EPS NY rev (1m)0.13%
EPS NY rev (3m)-2.82%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-2.11%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-0.3%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 26.93 | ||
| Fwd PE | 22.99 | ||
| P/S | 4.82 | ||
| P/FCF | 25.6 | ||
| P/OCF | 23.53 | ||
| P/B | 3.35 | ||
| P/tB | N/A | ||
| EV/EBITDA | 19.66 |
EPS(TTM)3.23
EY3.71%
EPS(NY)3.78
Fwd EY4.35%
FCF(TTM)3.4
FCFY3.91%
OCF(TTM)3.7
OCFY4.25%
SpS18.05
BVpS25.99
TBVpS-5.49
PEG (NY)5.54
PEG (5Y)1.72
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.48% | ||
| ROE | 7.85% | ||
| ROCE | 8.83% | ||
| ROIC | 6.78% | ||
| ROICexc | 7.51% | ||
| ROICexgc | 50.08% | ||
| OM | 20.07% | ||
| PM (TTM) | 11.3% | ||
| GM | 43.8% | ||
| FCFM | 18.83% |
ROA(3y)4.58%
ROA(5y)3.45%
ROE(3y)7.59%
ROE(5y)5.73%
ROIC(3y)6.33%
ROIC(5y)4.79%
ROICexc(3y)7.12%
ROICexc(5y)5.43%
ROICexgc(3y)46.29%
ROICexgc(5y)35.83%
ROCE(3y)8.25%
ROCE(5y)6.23%
ROICexcg growth 3Y22.68%
ROICexcg growth 5Y21.38%
ROICexc growth 3Y22.68%
ROICexc growth 5Y6.23%
OM growth 3Y18.5%
OM growth 5Y9.27%
PM growth 3Y2.02%
PM growth 5Y8.01%
GM growth 3Y4.32%
GM growth 5Y2.58%
F-Score6
Asset Turnover0.4
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.45 | ||
| Debt/FCF | 3.48 | ||
| Debt/EBITDA | 2.45 | ||
| Cap/Depr | 24.86% | ||
| Cap/Sales | 1.65% | ||
| Interest Coverage | 7.94 | ||
| Cash Conversion | 76.64% | ||
| Profit Quality | 166.61% | ||
| Current Ratio | 2.38 | ||
| Quick Ratio | 1.76 | ||
| Altman-Z | 3.69 |
F-Score6
WACC9.75%
ROIC/WACC0.7
Cap/Depr(3y)25.25%
Cap/Depr(5y)20.22%
Cap/Sales(3y)1.73%
Cap/Sales(5y)1.5%
Profit Quality(3y)146.25%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)4.53%
EPS 3Y15.06%
EPS 5Y15.65%
EPS Q2Q%-7.69%
EPS Next Y4.86%
EPS Next 2Y7.23%
EPS Next 3Y8.1%
EPS Next 5Y12.55%
Revenue 1Y (TTM)5.27%
Revenue growth 3Y11.98%
Revenue growth 5Y29.1%
Sales Q2Q%2.8%
Revenue Next Year3.54%
Revenue Next 2Y4.19%
Revenue Next 3Y4.64%
Revenue Next 5Y8%
EBIT growth 1Y12.43%
EBIT growth 3Y32.7%
EBIT growth 5Y41.07%
EBIT Next Year17.91%
EBIT Next 3Y10.73%
EBIT Next 5Y12.23%
FCF growth 1Y54.83%
FCF growth 3Y31.28%
FCF growth 5Y32.51%
OCF growth 1Y51.48%
OCF growth 3Y31.41%
OCF growth 5Y32.4%