TIMKEN CO (TKR) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:TKR - US8873891043 - Common Stock
94.15 USD
+0.75 (+0.8%)
94.15 USD
0 (0%)
Taking everything into account, TKR scores 5 out of 10 in our fundamental rating. TKR was compared to 132 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 is valued correctly, but it does not seem to be growing. TKR also has an excellent dividend rating. This makes TKR very considerable for dividend investing!
1. Profitability
1.1 Basic Checks
- TKR had positive earnings in the past year.
- In the past year TKR had a positive cash flow from operations.
- TKR had positive earnings in each of the past 5 years.
- TKR had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
- TKR's Return On Assets of 4.37% is in line compared to the rest of the industry. TKR outperforms 56.82% of its industry peers.
- TKR has a Return On Equity (9.48%) which is in line with its industry peers.
- TKR has a Return On Invested Capital (7.75%) which is in line with its industry peers.
- The Average Return On Invested Capital over the past 3 years for TKR is in line with the industry average of 10.24%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.37% | ||
| ROE | 9.48% | ||
| ROIC | 7.75% |
ROA(3y)6.19%
ROA(5y)6.27%
ROE(3y)15.23%
ROE(5y)15%
ROIC(3y)9.74%
ROIC(5y)9.38%
1.3 Margins
- TKR's Profit Margin of 6.54% is in line compared to the rest of the industry. TKR outperforms 57.58% of its industry peers.
- TKR's Profit Margin has declined in the last couple of years.
- Looking at the Operating Margin, with a value of 13.21%, TKR is in the better half of the industry, outperforming 65.15% of the companies in the same industry.
- TKR's Operating Margin has been stable in the last couple of years.
- TKR's Gross Margin of 31.40% is in line compared to the rest of the industry. TKR outperforms 51.52% of its industry peers.
- TKR's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 13.21% | ||
| PM (TTM) | 6.54% | ||
| GM | 31.4% |
OM growth 3Y1.88%
OM growth 5Y-0.66%
PM growth 3Y-4.77%
PM growth 5Y-4.19%
GM growth 3Y5.7%
GM growth 5Y0.9%
2. Health
2.1 Basic Checks
- The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so TKR is still creating some value.
- The number of shares outstanding for TKR remains at a similar level compared to 1 year ago.
- The number of shares outstanding for TKR has been reduced compared to 5 years ago.
- TKR has a better debt/assets ratio than last year.
2.2 Solvency
- An Altman-Z score of 2.90 indicates that TKR is not a great score, but indicates only limited risk for bankruptcy at the moment.
- The Altman-Z score of TKR (2.90) is comparable to the rest of the industry.
- The Debt to FCF ratio of TKR is 5.41, which is a neutral value as it means it would take TKR, 5.41 years of fcf income to pay off all of its debts.
- TKR has a Debt to FCF ratio of 5.41. This is comparable to the rest of the industry: TKR outperforms 53.03% of its industry peers.
- TKR has a Debt/Equity ratio of 0.67. This is a neutral value indicating TKR is somewhat dependend on debt financing.
- TKR's Debt to Equity ratio of 0.67 is on the low side compared to the rest of the industry. TKR is outperformed by 65.15% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.67 | ||
| Debt/FCF | 5.41 | ||
| Altman-Z | 2.9 |
ROIC/WACC0.84
WACC9.21%
2.3 Liquidity
- A Current Ratio of 3.11 indicates that TKR has no problem at all paying its short term obligations.
- The Current ratio of TKR (3.11) is better than 78.03% of its industry peers.
- TKR has a Quick Ratio of 1.71. This is a normal value and indicates that TKR 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, TKR is in the better half of the industry, outperforming 71.21% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 3.11 | ||
| Quick Ratio | 1.71 |
3. Growth
3.1 Past
- The earnings per share for TKR have decreased strongly by -10.83% in the last year.
- TKR shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 4.71% yearly.
- The Revenue has decreased by -1.01% in the past year.
- Measured over the past years, TKR shows a small growth in Revenue. The Revenue has been growing by 3.83% on average per year.
EPS 1Y (TTM)-10.83%
EPS 3Y7.12%
EPS 5Y4.71%
EPS Q2Q%11.38%
Revenue 1Y (TTM)-1.01%
Revenue growth 3Y3.43%
Revenue growth 5Y3.83%
Sales Q2Q%2.69%
3.2 Future
- TKR is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 4.17% yearly.
- Based on estimates for the next years, TKR will show a small growth in Revenue. The Revenue will grow by 1.65% on average per year.
EPS Next Y-7.96%
EPS Next 2Y2.09%
EPS Next 3Y4.7%
EPS Next 5Y4.17%
Revenue Next Year-0.43%
Revenue Next 2Y1.38%
Revenue Next 3Y1.97%
Revenue Next 5Y1.65%
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.
- 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
- A Price/Earnings ratio of 17.60 indicates a rather expensive valuation of TKR.
- Based on the Price/Earnings ratio, TKR is valued cheaper than 81.06% of the companies in the same industry.
- When comparing the Price/Earnings ratio of TKR to the average of the S&P500 Index (28.39), we can say TKR is valued slightly cheaper.
- With a Price/Forward Earnings ratio of 15.60, TKR is valued correctly.
- TKR's Price/Forward Earnings ratio is rather cheap when compared to the industry. TKR is cheaper than 83.33% of the companies in the same industry.
- When comparing the Price/Forward Earnings ratio of TKR to the average of the S&P500 Index (25.72), we can say TKR is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 17.6 | ||
| Fwd PE | 15.6 |
4.2 Price Multiples
- Based on the Enterprise Value to EBITDA ratio, TKR is valued cheaply inside the industry as 84.85% of the companies are valued more expensively.
- TKR's Price/Free Cash Flow ratio is rather cheap when compared to the industry. TKR is cheaper than 80.30% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 16.8 | ||
| EV/EBITDA | 9.89 |
4.3 Compensation for Growth
PEG (NY)N/A
PEG (5Y)3.74
EPS Next 2Y2.09%
EPS Next 3Y4.7%
5. Dividend
5.1 Amount
- TKR has a Yearly Dividend Yield of 1.48%.
- TKR's Dividend Yield is rather good when compared to the industry average which is at 1.01. TKR pays more dividend than 81.82% of the companies in the same industry.
- Compared to an average S&P500 Dividend Yield of 1.82, TKR has a dividend comparable with the average S&P500 company.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.48% |
5.2 History
- The dividend of TKR has a limited annual growth rate of 4.12%.
- TKR has been paying a dividend for at least 10 years, so it has 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)4.12%
Div Incr Years11
Div Non Decr Years15
5.3 Sustainability
- 32.90% of the earnings are spent on dividend by TKR. This is a low number and sustainable payout ratio.
- The dividend of TKR is growing around the same rate as the earnings are growing. If this keeps up the dividend growth is sustainable.
DP32.9%
EPS Next 2Y2.09%
EPS Next 3Y4.7%
TIMKEN CO / TKR FAQ
What is the ChartMill fundamental rating of TIMKEN CO (TKR) stock?
ChartMill assigns a fundamental rating of 5 / 10 to TKR.
Can you provide the valuation status for TIMKEN CO?
ChartMill assigns a valuation rating of 5 / 10 to TIMKEN CO (TKR). This can be considered as Fairly Valued.
Can you provide the profitability details for TIMKEN CO?
TIMKEN CO (TKR) has a profitability rating of 5 / 10.
Can you provide the financial health for TKR stock?
The financial health rating of TIMKEN CO (TKR) is 5 / 10.
Can you provide the expected EPS growth for TKR stock?
The Earnings per Share (EPS) of TIMKEN CO (TKR) is expected to decline by -7.96% in the next year.