TAYLOR MORRISON HOME CORP (TMHC) Stock Fundamental Analysis
NYSE:TMHC - New York Stock Exchange, Inc. - US87724P1066 - Common Stock - Currency: USD
We assign a fundamental rating of 6 out of 10 to TMHC. TMHC was compared to 67 industry peers in the Household Durables industry. While TMHC belongs to the best of the industry regarding profitability, there are some minor concerns on its financial health. TMHC may be a bit undervalued, certainly considering the very reasonable score on growth These ratings could make TMHC a good candidate for value investing.
1. Profitability
1.1 Basic Checks
In the past year TMHC was profitable.
TMHC had a positive operating cash flow in the past year.
Each year in the past 5 years TMHC has been profitable.
TMHC had a positive operating cash flow in 4 of the past 5 years.
1.2 Ratios
TMHC has a Return On Assets of 8.75%. This is in the better half of the industry: TMHC outperforms 66.15% of its industry peers.
TMHC has a better Return On Equity (14.26%) than 63.08% of its industry peers.
TMHC has a better Return On Invested Capital (10.92%) than 64.62% of its industry peers.
The Average Return On Invested Capital over the past 3 years for TMHC is in line with the industry average of 12.03%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.75% | ||
| ROE | 14.26% | ||
| ROIC | 10.92% |
ROA(3y)10.27%
ROA(5y)8.31%
ROE(3y)17.41%
ROE(5y)15.21%
ROIC(3y)12.32%
ROIC(5y)10.17%
1.3 Margins
With a decent Profit Margin value of 10.39%, TMHC is doing good in the industry, outperforming 80.00% of the companies in the same industry.
In the last couple of years the Profit Margin of TMHC has grown nicely.
TMHC has a better Operating Margin (14.84%) than 80.00% of its industry peers.
In the last couple of years the Operating Margin of TMHC has grown nicely.
TMHC has a Gross Margin (24.60%) which is comparable to the rest of the industry.
In the last couple of years the Gross Margin of TMHC has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 14.84% | ||
| PM (TTM) | 10.39% | ||
| GM | 24.6% |
OM growth 3Y8.55%
OM growth 5Y15.64%
PM growth 3Y6.96%
PM growth 5Y15.12%
GM growth 3Y5.68%
GM growth 5Y6.83%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), TMHC is creating some value.
Compared to 1 year ago, TMHC has less shares outstanding
Compared to 5 years ago, TMHC has less shares outstanding
The debt/assets ratio for TMHC has been reduced compared to a year ago.
2.2 Solvency
TMHC has an Altman-Z score of 3.73. This indicates that TMHC is financially healthy and has little risk of bankruptcy at the moment.
TMHC has a better Altman-Z score (3.73) than 61.54% of its industry peers.
TMHC has a debt to FCF ratio of 145.77. This is a negative value and a sign of low solvency as TMHC would need 145.77 years to pay back of all of its debts.
Looking at the Debt to FCF ratio, with a value of 145.77, TMHC is in line with its industry, outperforming 43.08% of the companies in the same industry.
A Debt/Equity ratio of 0.38 indicates that TMHC is not too dependend on debt financing.
With a Debt to Equity ratio value of 0.38, TMHC perfoms like the industry average, outperforming 41.54% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.38 | ||
| Debt/FCF | 145.77 | ||
| Altman-Z | 3.73 |
ROIC/WACC1.25
WACC8.76%
2.3 Liquidity
TMHC has a Current Ratio of 6.05. This indicates that TMHC is financially healthy and has no problem in meeting its short term obligations.
Looking at the Current ratio, with a value of 6.05, TMHC is in the better half of the industry, outperforming 80.00% of the companies in the same industry.
TMHC has a Quick Ratio of 6.05. This is a bad value and indicates that TMHC is not financially healthy enough and could expect problems in meeting its short term obligations.
TMHC's Quick ratio of 0.67 is on the low side compared to the rest of the industry. TMHC is outperformed by 64.62% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 6.05 | ||
| Quick Ratio | 0.67 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 19.69% over the past year.
Measured over the past years, TMHC shows a very strong growth in Earnings Per Share. The EPS has been growing by 23.42% on average per year.
Looking at the last year, TMHC shows a quite strong growth in Revenue. The Revenue has grown by 10.11% in the last year.
The Revenue has been growing by 11.39% on average over the past years. This is quite good.
EPS 1Y (TTM)19.69%
EPS 3Y17.06%
EPS 5Y23.42%
EPS Q2Q%45.57%
Revenue 1Y (TTM)10.11%
Revenue growth 3Y2.88%
Revenue growth 5Y11.39%
Sales Q2Q%11.98%
3.2 Future
TMHC is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 9.58% yearly.
The Revenue is expected to grow by 5.43% on average over the next years.
EPS Next Y9.6%
EPS Next 2Y9.58%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue Next Year6.06%
Revenue Next 2Y5.43%
Revenue Next 3YN/A
Revenue Next 5YN/A
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 decreasing.
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
With a Price/Earnings ratio of 7.25, the valuation of TMHC can be described as very cheap.
81.54% of the companies in the same industry are more expensive than TMHC, based on the Price/Earnings ratio.
Compared to an average S&P500 Price/Earnings ratio of 29.63, TMHC is valued rather cheaply.
The Price/Forward Earnings ratio is 6.61, which indicates a rather cheap valuation of TMHC.
90.77% of the companies in the same industry are more expensive than TMHC, based on the Price/Forward Earnings ratio.
When comparing the Price/Forward Earnings ratio of TMHC to the average of the S&P500 Index (22.68), we can say TMHC is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 7.25 | ||
| Fwd PE | 6.61 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of TMHC indicates a somewhat cheap valuation: TMHC is cheaper than 70.77% of the companies listed in the same industry.
TMHC's Price/Free Cash Flow ratio is a bit more expensive when compared to the industry. TMHC is more expensive than 60.00% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 427.84 | ||
| EV/EBITDA | 6.9 |
4.3 Compensation for Growth
TMHC's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
The decent profitability rating of TMHC may justify a higher PE ratio.
PEG (NY)0.76
PEG (5Y)0.31
EPS Next 2Y9.58%
EPS Next 3YN/A
5. Dividend
5.1 Amount
TMHC does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
60.79
-1.19 (-1.92%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Durables & Apparel
GICS IndustryHousehold Durables
Earnings (Last)
Earnings (Next)
Inst Owners99.61%
Inst Owner Change-1.08%
Ins Owners2.83%
Ins Owner Change5.93%
Market Cap6.29B
Analysts81.25
Price Target78.22 (28.67%)
Short Float %2.07%
Short Ratio2.13
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)7.07%
Min EPS beat(2)1.56%
Max EPS beat(2)12.59%
EPS beat(4)3
Avg EPS beat(4)2.69%
Min EPS beat(4)-10.92%
Max EPS beat(4)12.59%
EPS beat(8)5
Avg EPS beat(8)7.2%
EPS beat(12)9
Avg EPS beat(12)8.43%
EPS beat(16)10
Avg EPS beat(16)5.81%
Revenue beat(2)2
Avg Revenue beat(2)2.39%
Min Revenue beat(2)2.35%
Max Revenue beat(2)2.43%
Revenue beat(4)3
Avg Revenue beat(4)1.42%
Min Revenue beat(4)-2.43%
Max Revenue beat(4)3.34%
Revenue beat(8)7
Avg Revenue beat(8)4.25%
Revenue beat(12)9
Avg Revenue beat(12)2.55%
Revenue beat(16)11
Avg Revenue beat(16)2.1%
PT rev (1m)-4.85%
PT rev (3m)12.96%
EPS NQ rev (1m)-0.47%
EPS NQ rev (3m)-0.47%
EPS NY rev (1m)-0.11%
EPS NY rev (3m)-0.12%
Revenue NQ rev (1m)1.4%
Revenue NQ rev (3m)1.4%
Revenue NY rev (1m)0.72%
Revenue NY rev (3m)1.01%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 7.25 | ||
| Fwd PE | 6.61 | ||
| P/S | 0.8 | ||
| P/FCF | 427.84 | ||
| P/OCF | 229.59 | ||
| P/B | 1.1 | ||
| P/tB | 1.25 | ||
| EV/EBITDA | 6.9 |
EPS(TTM)8.39
EY13.8%
EPS(NY)9.2
Fwd EY15.13%
FCF(TTM)0.14
FCFY0.23%
OCF(TTM)0.26
OCFY0.44%
SpS75.68
BVpS55.13
TBVpS48.72
PEG (NY)0.76
PEG (5Y)0.31
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.75% | ||
| ROE | 14.26% | ||
| ROCE | 14.34% | ||
| ROIC | 10.92% | ||
| ROICexc | 11.28% | ||
| ROICexgc | 12.32% | ||
| OM | 14.84% | ||
| PM (TTM) | 10.39% | ||
| GM | 24.6% | ||
| FCFM | 0.19% |
ROA(3y)10.27%
ROA(5y)8.31%
ROE(3y)17.41%
ROE(5y)15.21%
ROIC(3y)12.32%
ROIC(5y)10.17%
ROICexc(3y)13.54%
ROICexc(5y)11.21%
ROICexgc(3y)15.41%
ROICexgc(5y)12.78%
ROCE(3y)16.18%
ROCE(5y)13.35%
ROICexcg growth 3Y4.7%
ROICexcg growth 5Y15.7%
ROICexc growth 3Y6.52%
ROICexc growth 5Y14.65%
OM growth 3Y8.55%
OM growth 5Y15.64%
PM growth 3Y6.96%
PM growth 5Y15.12%
GM growth 3Y5.68%
GM growth 5Y6.83%
F-Score6
Asset Turnover0.84
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.38 | ||
| Debt/FCF | 145.77 | ||
| Debt/EBITDA | 1.78 | ||
| Cap/Depr | 30.82% | ||
| Cap/Sales | 0.16% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 2.28% | ||
| Profit Quality | 1.81% | ||
| Current Ratio | 6.05 | ||
| Quick Ratio | 0.67 | ||
| Altman-Z | 3.73 |
F-Score6
WACC8.76%
ROIC/WACC1.25
Cap/Depr(3y)N/A
Cap/Depr(5y)N/A
Cap/Sales(3y)N/A
Cap/Sales(5y)N/A
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)19.69%
EPS 3Y17.06%
EPS 5Y23.42%
EPS Q2Q%45.57%
EPS Next Y9.6%
EPS Next 2Y9.58%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue 1Y (TTM)10.11%
Revenue growth 3Y2.88%
Revenue growth 5Y11.39%
Sales Q2Q%11.98%
Revenue Next Year6.06%
Revenue Next 2Y5.43%
Revenue Next 3YN/A
Revenue Next 5YN/A
EBIT growth 1Y0.46%
EBIT growth 3Y11.67%
EBIT growth 5Y28.82%
EBIT Next Year34.25%
EBIT Next 3YN/A
EBIT Next 5YN/A
FCF growth 1Y-98.71%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y-97.71%
OCF growth 3YN/A
OCF growth 5YN/A