TIMKEN CO (TKR) Stock Fundamental Analysis
NYSE:TKR - New York Stock Exchange, Inc. - US8873891043 - Common Stock - Currency: USD
TKR gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 130 industry peers in the Machinery industry. Both the profitability and the financial health of TKR get a neutral evaluation. Nothing too spectacular is happening here. TKR has a valuation in line with the averages, but on the other hand it scores bad on growth.
1. Profitability
1.1 Basic Checks
TKR had positive earnings in the past year.
TKR had a positive operating cash flow in the past year.
In the past 5 years TKR has always been profitable.
TKR had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
With a Return On Assets value of 5.03%, TKR perfoms like the industry average, outperforming 55.91% of the companies in the same industry.
TKR has a better Return On Equity (11.60%) than 62.20% of its industry peers.
TKR has a Return On Invested Capital (8.00%) which is in line with its industry peers.
TKR had an Average Return On Invested Capital over the past 3 years of 10.03%. This is in line with the industry average of 11.19%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.03% | ||
| ROE | 11.6% | ||
| ROIC | 8% |
ROA(3y)6.74%
ROA(5y)6.66%
ROE(3y)16.43%
ROE(5y)16.38%
ROIC(3y)10.03%
ROIC(5y)9.63%
1.3 Margins
TKR's Profit Margin of 7.41% is in line compared to the rest of the industry. TKR outperforms 59.84% of its industry peers.
TKR's Profit Margin has been stable in the last couple of years.
Looking at the Operating Margin, with a value of 13.44%, TKR is in the better half of the industry, outperforming 68.50% of the companies in the same industry.
TKR's Operating Margin has improved in the last couple of years.
TKR's Gross Margin of 31.52% is in line compared to the rest of the industry. TKR outperforms 52.76% of its industry peers.
TKR's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 13.44% | ||
| PM (TTM) | 7.41% | ||
| GM | 31.52% |
OM growth 3Y2.82%
OM growth 5Y2.8%
PM growth 3Y0.68%
PM growth 5Y-0.46%
GM growth 3Y3.25%
GM growth 5Y1.73%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), TKR is creating some value.
The number of shares outstanding for TKR has been reduced compared to 1 year ago.
Compared to 5 years ago, TKR has less shares outstanding
The debt/assets ratio for TKR is higher compared to a year ago.
2.2 Solvency
TKR has an Altman-Z score of 2.69. This is not the best score and indicates that TKR is in the grey zone with still only limited risk for bankruptcy at the moment.
TKR has a Altman-Z score (2.69) which is comparable to the rest of the industry.
The Debt to FCF ratio of TKR is 8.74, which is on the high side as it means it would take TKR, 8.74 years of fcf income to pay off all of its debts.
With a Debt to FCF ratio value of 8.74, TKR perfoms like the industry average, outperforming 43.31% of the companies in the same industry.
A Debt/Equity ratio of 0.76 indicates that TKR is somewhat dependend on debt financing.
TKR has a worse Debt to Equity ratio (0.76) than 75.59% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.76 | ||
| Debt/FCF | 8.74 | ||
| Altman-Z | 2.69 |
ROIC/WACC0.87
WACC9.18%
2.3 Liquidity
TKR has a Current Ratio of 3.00. This indicates that TKR is financially healthy and has no problem in meeting its short term obligations.
The Current ratio of TKR (3.00) is better than 76.38% of its industry peers.
TKR has a Quick Ratio of 1.62. This is a normal value and indicates that TKR is financially healthy and should not expect problems in meeting its short term obligations.
TKR's Quick ratio of 1.62 is fine compared to the rest of the industry. TKR outperforms 68.50% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 3 | ||
| Quick Ratio | 1.62 |
3. Growth
3.1 Past
TKR shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -12.66%.
TKR shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 10.93% yearly.
Looking at the last year, TKR shows a decrease in Revenue. The Revenue has decreased by -3.55% in the last year.
The Revenue has been growing slightly by 5.90% on average over the past years.
EPS 1Y (TTM)-12.66%
EPS 3Y19.63%
EPS 5Y10.93%
EPS Q2Q%-20.65%
Revenue 1Y (TTM)-3.55%
Revenue growth 3Y10.72%
Revenue growth 5Y5.9%
Sales Q2Q%-1.39%
3.2 Future
Based on estimates for the next years, TKR will show a small growth in Earnings Per Share. The EPS will grow by 3.90% on average per year.
Based on estimates for the next years, TKR will show a small growth in Revenue. The Revenue will grow by 1.86% on average per year.
EPS Next Y-19.13%
EPS Next 2Y-4.09%
EPS Next 3Y1.05%
EPS Next 5Y3.9%
Revenue Next Year-3.58%
Revenue Next 2Y-0.5%
Revenue Next 3Y0.98%
Revenue Next 5Y1.86%
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
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 13.58, the valuation of TKR can be described as correct.
Based on the Price/Earnings ratio, TKR is valued cheaper than 84.25% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 28.51, TKR is valued rather cheaply.
Based on the Price/Forward Earnings ratio of 12.61, the valuation of TKR can be described as correct.
TKR's Price/Forward Earnings ratio is rather cheap when compared to the industry. TKR is cheaper than 90.55% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of TKR to the average of the S&P500 Index (93.88), we can say TKR is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.58 | ||
| Fwd PE | 12.61 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, TKR is valued cheaper than 81.89% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, TKR is valued a bit cheaper than the industry average as 70.08% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 22.3 | ||
| EV/EBITDA | 8.85 |
4.3 Compensation for Growth
The decent profitability rating of TKR may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)1.24
EPS Next 2Y-4.09%
EPS Next 3Y1.05%
5. Dividend
5.1 Amount
TKR has a Yearly Dividend Yield of 1.77%.
TKR's Dividend Yield is rather good when compared to the industry average which is at 1.61. TKR pays more dividend than 85.04% of the companies in the same industry.
Compared to the average S&P500 Dividend Yield of 2.27, TKR is paying slightly less dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.77% |
5.2 History
The dividend of TKR has a limited annual growth rate of 3.39%.
TKR has paid a dividend for at least 10 years, which is a reliable track record.
TKR has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)3.39%
Div Incr Years11
Div Non Decr Years15
5.3 Sustainability
28.04% of the earnings are spent on dividend by TKR. This is a low number and sustainable payout ratio.
TKR's earnings are growing around the same pace than its dividend. As long as the earnings growth is kept the dividend growth is sustainable.
DP28.04%
EPS Next 2Y-4.09%
EPS Next 3Y1.05%
TIMKEN CO
NYSE:TKR (1/31/2025, 12:42:48 PM)
81.45
+1.29 (+1.61%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryMachinery
Earnings (Last)
Earnings (Next)
Inst Owners87.81%
Inst Owner Change-0.11%
Ins Owners6.06%
Ins Owner Change-5.11%
Market Cap5.71B
Analysts75
Price Target91.7 (12.58%)
Short Float %2.64%
Short Ratio2.81
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.77% |
Yearly Dividend1.32
Dividend Growth(5Y)3.39%
DP28.04%
Div Incr Years11
Div Non Decr Years15
Ex-DateN/A
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-5.46%
Min EPS beat(2)-11.49%
Max EPS beat(2)0.58%
EPS beat(4)3
Avg EPS beat(4)3.99%
Min EPS beat(4)-11.49%
Max EPS beat(4)15.8%
EPS beat(8)5
Avg EPS beat(8)3.5%
EPS beat(12)8
Avg EPS beat(12)7.25%
EPS beat(16)9
Avg EPS beat(16)5.29%
Revenue beat(2)0
Avg Revenue beat(2)-0.63%
Min Revenue beat(2)-1.06%
Max Revenue beat(2)-0.19%
Revenue beat(4)2
Avg Revenue beat(4)0.88%
Min Revenue beat(4)-1.06%
Max Revenue beat(4)2.52%
Revenue beat(8)3
Avg Revenue beat(8)-0.59%
Revenue beat(12)6
Avg Revenue beat(12)0.07%
Revenue beat(16)10
Avg Revenue beat(16)0.45%
PT rev (1m)3.33%
PT rev (3m)-3.12%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-23.15%
EPS NY rev (1m)0%
EPS NY rev (3m)-8.24%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-3.75%
Revenue NY rev (1m)-0.07%
Revenue NY rev (3m)-0.54%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.58 | ||
| Fwd PE | 12.61 | ||
| P/S | 1.24 | ||
| P/FCF | 22.3 | ||
| P/OCF | 13.43 | ||
| P/B | 1.95 | ||
| P/tB | 13.99 | ||
| EV/EBITDA | 8.85 |
EPS(TTM)6
EY7.37%
EPS(NY)6.46
Fwd EY7.93%
FCF(TTM)3.65
FCFY4.48%
OCF(TTM)6.07
OCFY7.45%
SpS65.47
BVpS41.83
TBVpS5.82
PEG (NY)N/A
PEG (5Y)1.24
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.03% | ||
| ROE | 11.6% | ||
| ROCE | 10.53% | ||
| ROIC | 8% | ||
| ROICexc | 8.63% | ||
| ROICexgc | 16.06% | ||
| OM | 13.44% | ||
| PM (TTM) | 7.41% | ||
| GM | 31.52% | ||
| FCFM | 5.58% |
ROA(3y)6.74%
ROA(5y)6.66%
ROE(3y)16.43%
ROE(5y)16.38%
ROIC(3y)10.03%
ROIC(5y)9.63%
ROICexc(3y)10.9%
ROICexc(5y)10.41%
ROICexgc(3y)20.14%
ROICexgc(5y)19.1%
ROCE(3y)13.25%
ROCE(5y)12.76%
ROICexcg growth 3Y12.52%
ROICexcg growth 5Y6.03%
ROICexc growth 3Y7.91%
ROICexc growth 5Y3.8%
OM growth 3Y2.82%
OM growth 5Y2.8%
PM growth 3Y0.68%
PM growth 5Y-0.46%
GM growth 3Y3.25%
GM growth 5Y1.73%
F-Score6
Asset Turnover0.68
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.76 | ||
| Debt/FCF | 8.74 | ||
| Debt/EBITDA | 2.65 | ||
| Cap/Depr | 77.7% | ||
| Cap/Sales | 3.69% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 50.96% | ||
| Profit Quality | 75.28% | ||
| Current Ratio | 3 | ||
| Quick Ratio | 1.62 | ||
| Altman-Z | 2.69 |
F-Score6
WACC9.18%
ROIC/WACC0.87
Cap/Depr(3y)96.82%
Cap/Depr(5y)90.15%
Cap/Sales(3y)3.83%
Cap/Sales(5y)3.73%
Profit Quality(3y)75.16%
Profit Quality(5y)99.77%
High Growth Momentum
Growth
EPS 1Y (TTM)-12.66%
EPS 3Y19.63%
EPS 5Y10.93%
EPS Q2Q%-20.65%
EPS Next Y-19.13%
EPS Next 2Y-4.09%
EPS Next 3Y1.05%
EPS Next 5Y3.9%
Revenue 1Y (TTM)-3.55%
Revenue growth 3Y10.72%
Revenue growth 5Y5.9%
Sales Q2Q%-1.39%
Revenue Next Year-3.58%
Revenue Next 2Y-0.5%
Revenue Next 3Y0.98%
Revenue Next 5Y1.86%
EBIT growth 1Y-12.76%
EBIT growth 3Y13.85%
EBIT growth 5Y8.87%
EBIT Next Year12.08%
EBIT Next 3Y8.66%
EBIT Next 5Y10.3%
FCF growth 1Y62.29%
FCF growth 3Y-7.8%
FCF growth 5Y10.2%
OCF growth 1Y30.89%
OCF growth 3Y-1.91%
OCF growth 5Y10.4%