MOHAWK INDUSTRIES INC (MHK) Stock Fundamental Analysis
NYSE:MHK - New York Stock Exchange, Inc. - US6081901042 - Common Stock - Currency: USD
We assign a fundamental rating of 4 out of 10 to MHK. MHK was compared to 64 industry peers in the Household Durables industry. The financial health of MHK is average, but there are quite some concerns on its profitability. MHK is not valued too expensively and it also shows a decent growth rate.
1. Profitability
1.1 Basic Checks
In the past year MHK was profitable.
In the past year MHK had a positive cash flow from operations.
MHK had positive earnings in 4 of the past 5 years.
MHK had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
With a Return On Assets value of 3.62%, MHK perfoms like the industry average, outperforming 50.00% of the companies in the same industry.
MHK's Return On Equity of 6.18% is in line compared to the rest of the industry. MHK outperforms 42.19% of its industry peers.
Looking at the Return On Invested Capital, with a value of 5.87%, MHK is in line with its industry, outperforming 46.88% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for MHK is below the industry average of 10.34%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.62% | ||
| ROE | 6.18% | ||
| ROIC | 5.87% |
ROA(3y)0.33%
ROA(5y)2.37%
ROE(3y)0.47%
ROE(5y)3.94%
ROIC(3y)6.82%
ROIC(5y)7.05%
1.3 Margins
MHK has a Profit Margin (4.54%) which is comparable to the rest of the industry.
In the last couple of years the Profit Margin of MHK has declined.
With a Operating Margin value of 7.15%, MHK perfoms like the industry average, outperforming 50.00% of the companies in the same industry.
In the last couple of years the Operating Margin of MHK has declined.
The Gross Margin of MHK (25.47%) is comparable to the rest of the industry.
In the last couple of years the Gross Margin of MHK has declined.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 7.15% | ||
| PM (TTM) | 4.54% | ||
| GM | 25.47% |
OM growth 3Y-15.02%
OM growth 5Y-4.36%
PM growth 3Y-19.69%
PM growth 5Y-8.53%
GM growth 3Y-4.53%
GM growth 5Y-1.63%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so MHK is destroying value.
MHK has less shares outstanding than it did 1 year ago.
MHK has less shares outstanding than it did 5 years ago.
The debt/assets ratio for MHK has been reduced compared to a year ago.
2.2 Solvency
MHK has an Altman-Z score of 2.78. This is not the best score and indicates that MHK is in the grey zone with still only limited risk for bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 2.78, MHK is in line with its industry, outperforming 50.00% of the companies in the same industry.
The Debt to FCF ratio of MHK is 4.80, which is a neutral value as it means it would take MHK, 4.80 years of fcf income to pay off all of its debts.
With a decent Debt to FCF ratio value of 4.80, MHK is doing good in the industry, outperforming 60.94% of the companies in the same industry.
A Debt/Equity ratio of 0.22 indicates that MHK is not too dependend on debt financing.
Looking at the Debt to Equity ratio, with a value of 0.22, MHK is in the better half of the industry, outperforming 62.50% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.22 | ||
| Debt/FCF | 4.8 | ||
| Altman-Z | 2.78 |
ROIC/WACC0.64
WACC9.23%
2.3 Liquidity
MHK has a Current Ratio of 2.01. This indicates that MHK is financially healthy and has no problem in meeting its short term obligations.
MHK's Current ratio of 2.01 is on the low side compared to the rest of the industry. MHK is outperformed by 60.94% of its industry peers.
A Quick Ratio of 1.13 indicates that MHK should not have too much problems paying its short term obligations.
MHK has a Quick ratio of 1.13. This is in the better half of the industry: MHK outperforms 60.94% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.01 | ||
| Quick Ratio | 1.13 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 0.75% over the past year.
MHK shows a decrease in Earnings Per Share. Measured over the last years, the EPS has been decreasing by -0.63% yearly.
MHK shows a decrease in Revenue. In the last year, the revenue decreased by -2.95%.
MHK shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 1.68% yearly.
EPS 1Y (TTM)0.75%
EPS 3Y-13.18%
EPS 5Y-0.63%
EPS Q2Q%-18.28%
Revenue 1Y (TTM)-2.95%
Revenue growth 3Y-1.1%
Revenue growth 5Y1.68%
Sales Q2Q%-5.73%
3.2 Future
The Earnings Per Share is expected to grow by 10.35% on average over the next years. This is quite good.
The Revenue is expected to grow by 2.35% on average over the next years.
EPS Next Y-4.76%
EPS Next 2Y5.68%
EPS Next 3Y8.21%
EPS Next 5Y10.35%
Revenue Next Year-0.43%
Revenue Next 2Y1.28%
Revenue Next 3Y1.83%
Revenue Next 5Y2.35%
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
A Price/Earnings ratio of 11.88 indicates a reasonable valuation of MHK.
MHK's Price/Earnings ratio is in line with the industry average.
When comparing the Price/Earnings ratio of MHK to the average of the S&P500 Index (27.28), we can say MHK is valued rather cheaply.
A Price/Forward Earnings ratio of 10.26 indicates a reasonable valuation of MHK.
Compared to the rest of the industry, the Price/Forward Earnings ratio of MHK is on the same level as its industry peers.
Compared to an average S&P500 Price/Forward Earnings ratio of 21.76, MHK is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 11.88 | ||
| Fwd PE | 10.26 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, MHK is valued a bit cheaper than the industry average as 79.69% of the companies are valued more expensively.
79.69% of the companies in the same industry are more expensive than MHK, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 13.99 | ||
| EV/EBITDA | 6.18 |
4.3 Compensation for Growth
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y5.68%
EPS Next 3Y8.21%
5. Dividend
5.1 Amount
MHK does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
111.29
+1.88 (+1.72%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Durables & Apparel
GICS IndustryHousehold Durables
Earnings (Last)
Earnings (Next)
Inst Owners83.17%
Inst Owner Change1.81%
Ins Owners3.58%
Ins Owner Change8.27%
Market Cap6.96B
Analysts75.65
Price Target128.48 (15.45%)
Short Float %3.91%
Short Ratio2.56
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Yearly DividendN/A
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)5.55%
Min EPS beat(2)4.23%
Max EPS beat(2)6.88%
EPS beat(4)3
Avg EPS beat(4)4.6%
Min EPS beat(4)-0.6%
Max EPS beat(4)7.91%
EPS beat(8)7
Avg EPS beat(8)4.69%
EPS beat(12)9
Avg EPS beat(12)5.89%
EPS beat(16)13
Avg EPS beat(16)7.75%
Revenue beat(2)1
Avg Revenue beat(2)0.32%
Min Revenue beat(2)-2.29%
Max Revenue beat(2)2.94%
Revenue beat(4)1
Avg Revenue beat(4)-0.42%
Min Revenue beat(4)-2.29%
Max Revenue beat(4)2.94%
Revenue beat(8)3
Avg Revenue beat(8)-0.19%
Revenue beat(12)4
Avg Revenue beat(12)-0.72%
Revenue beat(16)7
Avg Revenue beat(16)-0.03%
PT rev (1m)-1.33%
PT rev (3m)-12.13%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-8.32%
EPS NY rev (1m)0%
EPS NY rev (3m)-4.62%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-0.43%
Revenue NY rev (1m)0.01%
Revenue NY rev (3m)-0.56%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 11.88 | ||
| Fwd PE | 10.26 | ||
| P/S | 0.65 | ||
| P/FCF | 13.99 | ||
| P/OCF | 7.29 | ||
| P/B | 0.89 | ||
| P/tB | 1.18 | ||
| EV/EBITDA | 6.18 |
EPS(TTM)9.37
EY8.42%
EPS(NY)10.85
Fwd EY9.75%
FCF(TTM)7.95
FCFY7.15%
OCF(TTM)15.26
OCFY13.71%
SpS170.88
BVpS125.66
TBVpS94.47
PEG (NY)N/A
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.62% | ||
| ROE | 6.18% | ||
| ROCE | 7.32% | ||
| ROIC | 5.87% | ||
| ROICexc | 6.29% | ||
| ROICexgc | 7.87% | ||
| OM | 7.15% | ||
| PM (TTM) | 4.54% | ||
| GM | 25.47% | ||
| FCFM | 4.65% |
ROA(3y)0.33%
ROA(5y)2.37%
ROE(3y)0.47%
ROE(5y)3.94%
ROIC(3y)6.82%
ROIC(5y)7.05%
ROICexc(3y)7.28%
ROICexc(5y)7.56%
ROICexgc(3y)9.46%
ROICexgc(5y)10.45%
ROCE(3y)8.51%
ROCE(5y)8.8%
ROICexcg growth 3Y-17.3%
ROICexcg growth 5Y-4.07%
ROICexc growth 3Y-12.4%
ROICexc growth 5Y-0.59%
OM growth 3Y-15.02%
OM growth 5Y-4.36%
PM growth 3Y-19.69%
PM growth 5Y-8.53%
GM growth 3Y-4.53%
GM growth 5Y-1.63%
F-Score6
Asset Turnover0.8
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.22 | ||
| Debt/FCF | 4.8 | ||
| Debt/EBITDA | 1.21 | ||
| Cap/Depr | 71.98% | ||
| Cap/Sales | 4.27% | ||
| Interest Coverage | 13.08 | ||
| Cash Conversion | 68.21% | ||
| Profit Quality | 102.47% | ||
| Current Ratio | 2.01 | ||
| Quick Ratio | 1.13 | ||
| Altman-Z | 2.78 |
F-Score6
WACC9.23%
ROIC/WACC0.64
Cap/Depr(3y)88.65%
Cap/Depr(5y)90.05%
Cap/Sales(3y)4.88%
Cap/Sales(5y)5.03%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)0.75%
EPS 3Y-13.18%
EPS 5Y-0.63%
EPS Q2Q%-18.28%
EPS Next Y-4.76%
EPS Next 2Y5.68%
EPS Next 3Y8.21%
EPS Next 5Y10.35%
Revenue 1Y (TTM)-2.95%
Revenue growth 3Y-1.1%
Revenue growth 5Y1.68%
Sales Q2Q%-5.73%
Revenue Next Year-0.43%
Revenue Next 2Y1.28%
Revenue Next 3Y1.83%
Revenue Next 5Y2.35%
EBIT growth 1Y6.37%
EBIT growth 3Y-15.95%
EBIT growth 5Y-2.76%
EBIT Next Year64.49%
EBIT Next 3Y23.72%
EBIT Next 5Y17.9%
FCF growth 1Y70.39%
FCF growth 3Y2.39%
FCF growth 5Y-4.89%
OCF growth 1Y9.45%
OCF growth 3Y-4.68%
OCF growth 5Y-4.38%