INGERSOLL-RAND INC (IR) Stock Fundamental Analysis
NYSE:IR - New York Stock Exchange, Inc. - US45687V1061 - Common Stock - Currency: USD
IR gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 128 industry peers in the Machinery industry. IR scores excellent on profitability, but 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
IR had positive earnings in the past year.
IR had a positive operating cash flow in the past year.
IR had positive earnings in 4 of the past 5 years.
Each year in the past 5 years IR had a positive operating cash flow.
1.2 Ratios
The Return On Assets of IR (4.66%) is comparable to the rest of the industry.
IR has a Return On Equity (8.24%) which is comparable to the rest of the industry.
IR has a Return On Invested Capital (6.90%) which is comparable to the rest of the industry.
IR had an Average Return On Invested Capital over the past 3 years of 6.33%. This is below the industry average of 10.67%.
The 3 year average ROIC (6.33%) for IR is below the current ROIC(6.90%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.66% | ||
| ROE | 8.24% | ||
| ROIC | 6.9% |
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 better Profit Margin (11.59%) than 78.13% of its industry peers.
IR's Profit Margin has improved in the last couple of years.
IR's Operating Margin of 20.10% is amongst the best of the industry. IR outperforms 88.28% of its industry peers.
IR's Operating Margin has improved in the last couple of years.
The Gross Margin of IR (43.81%) is better than 79.69% of its industry peers.
IR's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 20.1% | ||
| PM (TTM) | 11.59% | ||
| GM | 43.81% |
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.
The number of shares outstanding for IR has been increased compared to 5 years ago.
IR has a worse debt/assets ratio than last year.
2.2 Solvency
An Altman-Z score of 3.24 indicates that IR is not in any danger for bankruptcy at the moment.
With a Altman-Z score value of 3.24, IR perfoms like the industry average, outperforming 57.81% of the companies in the same industry.
The Debt to FCF ratio of IR is 3.81, which is a good value as it means it would take IR, 3.81 years of fcf income to pay off all of its debts.
IR has a Debt to FCF ratio (3.81) which is comparable to the rest of the industry.
IR has a Debt/Equity ratio of 0.47. This is a healthy value indicating a solid balance between debt and equity.
With a Debt to Equity ratio value of 0.47, IR perfoms like the industry average, outperforming 49.22% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.47 | ||
| Debt/FCF | 3.81 | ||
| Altman-Z | 3.24 |
ROIC/WACC0.69
WACC10.03%
2.3 Liquidity
IR has a Current Ratio of 2.29. This indicates that IR is financially healthy and has no problem in meeting its short term obligations.
With a Current ratio value of 2.29, IR perfoms like the industry average, outperforming 58.59% of the companies in the same industry.
IR has a Quick Ratio of 1.71. This is a normal value and indicates that IR is financially healthy and should not expect problems in meeting its short term obligations.
Looking at the Quick ratio, with a value of 1.71, IR is in the better half of the industry, outperforming 69.53% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.29 | ||
| Quick Ratio | 1.71 |
3. Growth
3.1 Past
IR shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 11.15%, which is quite good.
IR shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 15.65% yearly.
The Revenue has been growing slightly by 5.22% in the past year.
Measured over the past years, IR shows a very strong growth in Revenue. The Revenue has been growing by 29.10% on average per year.
EPS 1Y (TTM)11.15%
EPS 3Y15.06%
EPS 5Y15.65%
EPS Q2Q%-2.33%
Revenue 1Y (TTM)5.22%
Revenue growth 3Y11.98%
Revenue growth 5Y29.1%
Sales Q2Q%4.24%
3.2 Future
The Earnings Per Share is expected to grow by 12.87% on average over the next years. This is quite good.
Based on estimates for the next years, IR will show a quite strong growth in Revenue. The Revenue will grow by 8.30% on average per year.
EPS Next Y7.58%
EPS Next 2Y8.71%
EPS Next 3Y8.96%
EPS Next 5Y12.87%
Revenue Next Year3.63%
Revenue Next 2Y4.48%
Revenue Next 3Y4.88%
Revenue Next 5Y8.3%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
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
Based on the Price/Earnings ratio of 21.90, the valuation of IR can be described as rather expensive.
IR's Price/Earnings ratio is in line with the industry average.
IR is valuated rather cheaply when we compare the Price/Earnings ratio to 28.29, which is the current average of the S&P500 Index.
With a Price/Forward Earnings ratio of 20.35, IR is valued on the expensive side.
IR's Price/Forward Earnings ratio is in line with the industry average.
IR is valuated at similar levels of the S&P average when we compare the Price/Forward Earnings ratio to 21.08, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 21.9 | ||
| Fwd PE | 20.35 |
4.2 Price Multiples
IR's Enterprise Value to EBITDA ratio is a bit more expensive when compared to the industry. IR is more expensive than 61.72% of the companies in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of IR is on the same level as its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 23.27 | ||
| EV/EBITDA | 16.66 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
The decent profitability rating of IR may justify a higher PE ratio.
PEG (NY)2.89
PEG (5Y)1.4
EPS Next 2Y8.71%
EPS Next 3Y8.96%
5. Dividend
5.1 Amount
IR has a yearly dividend return of 0.11%, which is pretty low.
The stock price of IR dropped by -21.59% in the last 3 months. With lower prices the dividend yield is higher, but it may be a sign investors do not trust the long term dividend.
Compared to an average industry Dividend Yield of 2.12, IR has a dividend in line with its industry peers.
With a Dividend Yield of 0.11, IR pays less dividend than the S&P500 average, which is at 2.52.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.11% |
5.2 History
IR has paid a dividend for at least 10 years, which is a reliable track record.
The dividend of IR decreased in the last 3 years.
Dividend Growth(5Y)N/A
Div Incr Years2
Div Non Decr Years2
5.3 Sustainability
IR pays out 3.85% of its income as dividend. This is a sustainable payout ratio.
DP3.85%
EPS Next 2Y8.71%
EPS Next 3Y8.96%
72.04
+0.68 (+0.95%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryMachinery
Earnings (Last)
Earnings (Next)
Inst Owners100.07%
Inst Owner Change0%
Ins Owners0.2%
Ins Owner Change7.8%
Market Cap29.04B
Analysts77.6
Price Target100.85 (39.99%)
Short Float %2.09%
Short Ratio3.19
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.11% |
Yearly Dividend0.08
Dividend Growth(5Y)N/A
DP3.85%
Div Incr Years2
Div Non Decr Years2
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-1.48%
Min EPS beat(2)-3.21%
Max EPS beat(2)0.25%
EPS beat(4)3
Avg EPS beat(4)2.44%
Min EPS beat(4)-3.21%
Max EPS beat(4)9.69%
EPS beat(8)7
Avg EPS beat(8)7.24%
EPS beat(12)11
Avg EPS beat(12)6.52%
EPS beat(16)15
Avg EPS beat(16)8.66%
Revenue beat(2)0
Avg Revenue beat(2)-3.45%
Min Revenue beat(2)-3.58%
Max Revenue beat(2)-3.33%
Revenue beat(4)0
Avg Revenue beat(4)-3.55%
Min Revenue beat(4)-4.62%
Max Revenue beat(4)-2.68%
Revenue beat(8)3
Avg Revenue beat(8)-0.55%
Revenue beat(12)7
Avg Revenue beat(12)0.07%
Revenue beat(16)9
Avg Revenue beat(16)-0.95%
PT rev (1m)-1.49%
PT rev (3m)-10.88%
EPS NQ rev (1m)-0.48%
EPS NQ rev (3m)-6.99%
EPS NY rev (1m)-0.3%
EPS NY rev (3m)-3.04%
Revenue NQ rev (1m)-0.61%
Revenue NQ rev (3m)-3.89%
Revenue NY rev (1m)-0.21%
Revenue NY rev (3m)-2.75%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 21.9 | ||
| Fwd PE | 20.35 | ||
| P/S | 4.01 | ||
| P/FCF | 23.27 | ||
| P/OCF | 20.79 | ||
| P/B | 2.85 | ||
| P/tB | N/A | ||
| EV/EBITDA | 16.66 |
EPS(TTM)3.29
EY4.57%
EPS(NY)3.54
Fwd EY4.91%
FCF(TTM)3.1
FCFY4.3%
OCF(TTM)3.47
OCFY4.81%
SpS17.95
BVpS25.25
TBVpS-5.81
PEG (NY)2.89
PEG (5Y)1.4
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.66% | ||
| ROE | 8.24% | ||
| ROCE | 8.98% | ||
| ROIC | 6.9% | ||
| ROICexc | 7.62% | ||
| ROICexgc | 52.45% | ||
| OM | 20.1% | ||
| PM (TTM) | 11.59% | ||
| GM | 43.81% | ||
| FCFM | 17.24% |
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 | 0.47 | ||
| Debt/FCF | 3.81 | ||
| Debt/EBITDA | 2.46 | ||
| Cap/Depr | 30.93% | ||
| Cap/Sales | 2.06% | ||
| Interest Coverage | 6.96 | ||
| Cash Conversion | 72.13% | ||
| Profit Quality | 148.77% | ||
| Current Ratio | 2.29 | ||
| Quick Ratio | 1.71 | ||
| Altman-Z | 3.24 |
F-Score6
WACC10.03%
ROIC/WACC0.69
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)11.15%
EPS 3Y15.06%
EPS 5Y15.65%
EPS Q2Q%-2.33%
EPS Next Y7.58%
EPS Next 2Y8.71%
EPS Next 3Y8.96%
EPS Next 5Y12.87%
Revenue 1Y (TTM)5.22%
Revenue growth 3Y11.98%
Revenue growth 5Y29.1%
Sales Q2Q%4.24%
Revenue Next Year3.63%
Revenue Next 2Y4.48%
Revenue Next 3Y4.88%
Revenue Next 5Y8.3%
EBIT growth 1Y17.14%
EBIT growth 3Y32.7%
EBIT growth 5Y41.07%
EBIT Next Year20.58%
EBIT Next 3Y11.6%
EBIT Next 5Y12.69%
FCF growth 1Y-1.92%
FCF growth 3Y31.28%
FCF growth 5Y32.51%
OCF growth 1Y1.4%
OCF growth 3Y31.41%
OCF growth 5Y32.4%