We assign a fundamental rating of 5 out of 10 to TDY. TDY was compared to 123 industry peers in the Electronic Equipment, Instruments & Components industry. While TDY has a great profitability rating, there are quite some concerns on its financial health. TDY has a decent growth rate and is not valued too expensively.

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1. Profitability

2. Health

3. Growth

4. Valuation

5. Dividend

1. Profitability

1.1 Basic Checks

In the past year TDY was profitable.
In the past year TDY had a positive cash flow from operations.
In the past 5 years TDY has always been profitable.
In the past 5 years TDY always reported a positive cash flow from operatings.

1.2 Ratios

TDY's Return On Assets of 5.85% is fine compared to the rest of the industry. TDY outperforms 76.42% of its industry peers.
TDY's Return On Equity of 8.51% is fine compared to the rest of the industry. TDY outperforms 69.11% of its industry peers.
TDY has a better Return On Invested Capital (7.25%) than 73.98% of its industry peers.
TDY had an Average Return On Invested Capital over the past 3 years of 6.98%. This is in line with the industry average of 8.87%.
The last Return On Invested Capital (7.25%) for TDY is above the 3 year average (6.98%), which is a sign of increasing profitability.

		Industry Rank	Sector Rank
ROA	5.85%
ROE	8.51%
ROIC	7.25%

ROA(3y)5.91%

ROA(5y)5.26%

ROE(3y)8.9%

ROE(5y)8.44%

ROIC(3y)6.98%

ROIC(5y)6.32%

1.3 Margins

Looking at the Profit Margin, with a value of 14.63%, TDY belongs to the top of the industry, outperforming 92.68% of the companies in the same industry.
In the last couple of years the Profit Margin of TDY has grown nicely.
With an excellent Operating Margin value of 18.80%, TDY belongs to the best of the industry, outperforming 95.12% of the companies in the same industry.
In the last couple of years the Operating Margin of TDY has grown nicely.
TDY has a better Gross Margin (42.76%) than 73.17% of its industry peers.
TDY's Gross Margin has improved in the last couple of years.

		Industry Rank	Sector Rank
OM	18.8%
PM (TTM)	14.63%
GM	42.76%

OM growth 3Y1.83%

OM growth 5Y3.86%

PM growth 3Y0.43%

PM growth 5Y2.36%

GM growth 3Y0.05%

GM growth 5Y2.25%

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ROA

ROE

ROIC

Operating and Profit Margin

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2. Health

2.1 Basic Checks

The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so TDY is destroying value.
Compared to 1 year ago, TDY has more shares outstanding
The number of shares outstanding for TDY has been increased compared to 5 years ago.
Compared to 1 year ago, TDY has an improved debt to assets ratio.

2.2 Solvency

TDY has a debt to FCF ratio of 2.30. This is a good value and a sign of high solvency as TDY would need 2.30 years to pay back of all of its debts.
TDY has a better Debt to FCF ratio (2.30) than 73.17% of its industry peers.
A Debt/Equity ratio of 0.19 indicates that TDY is not too dependend on debt financing.
Looking at the Debt to Equity ratio, with a value of 0.19, TDY is in line with its industry, outperforming 46.34% of the companies in the same industry.

		Industry Rank	Sector Rank
Debt/Equity	0.19
Debt/FCF	2.3
Altman-Z	N/A

ROIC/WACC0.85

WACC8.5%

2.3 Liquidity

A Current Ratio of 1.64 indicates that TDY should not have too much problems paying its short term obligations.
TDY has a Current ratio of 1.64. This is in the lower half of the industry: TDY underperforms 69.92% of its industry peers.
A Quick Ratio of 1.08 indicates that TDY should not have too much problems paying its short term obligations.
TDY has a worse Quick ratio (1.08) than 74.80% of its industry peers.

		Industry Rank	Sector Rank
Current Ratio	1.64
Quick Ratio	1.08

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WACC

Debt/Equity

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Altman-Z score

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3. Growth

3.1 Past

The Earnings Per Share has grown by an nice 11.49% over the past year.
TDY shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 15.72% yearly.
TDY shows a small growth in Revenue. In the last year, the Revenue has grown by 7.86%.
TDY shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 14.66% yearly.

EPS 1Y (TTM)11.49%

EPS 3Y6.6%

EPS 5Y15.72%

EPS Q2Q%14.13%

Revenue 1Y (TTM)7.86%

Revenue growth 3Y3.86%

Revenue growth 5Y14.66%

Sales Q2Q%7.32%

3.2 Future

Based on estimates for the next years, TDY will show a small growth in Earnings Per Share. The EPS will grow by 7.85% on average per year.
Based on estimates for the next years, TDY will show a small growth in Revenue. The Revenue will grow by 5.10% on average per year.

EPS Next Y8.36%

EPS Next 2Y7.85%

EPS Next 3YN/A

EPS Next 5YN/A

Revenue Next Year5.22%

Revenue Next 2Y5.13%

Revenue Next 3Y5.1%

Revenue Next 5YN/A

3.3 Evolution

The EPS growth rate is decreasing: in the next years the growth will be less 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.

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4. Valuation

4.1 Price/Earnings Ratio

Based on the Price/Earnings ratio of 27.59, the valuation of TDY can be described as expensive.
68.29% of the companies in the same industry are more expensive than TDY, based on the Price/Earnings ratio.
TDY is valuated at similar levels of the S&P average when we compare the Price/Earnings ratio to 27.25, which is the current average of the S&P500 Index.
TDY is valuated quite expensively with a Price/Forward Earnings ratio of 25.46.
Based on the Price/Forward Earnings ratio, TDY is valued a bit cheaper than 63.41% of the companies in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 25.98. TDY is around the same levels.

		Industry Rank	Sector Rank
PE	27.59
Fwd PE	25.46

4.2 Price Multiples

Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of TDY indicates a somewhat cheap valuation: TDY is cheaper than 63.41% of the companies listed in the same industry.
Based on the Price/Free Cash Flow ratio, TDY is valued a bit cheaper than 71.54% of the companies in the same industry.

		Industry Rank	Sector Rank
P/FCF	26.56
EV/EBITDA	20.72

4.3 Compensation for Growth

The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates TDY does not grow enough to justify the current Price/Earnings ratio.
The excellent profitability rating of TDY may justify a higher PE ratio.