TENNANT CO (TNC) Stock Fundamental Analysis
NYSE:TNC - New York Stock Exchange, Inc. - US8803451033 - Common Stock - Currency: USD
Taking everything into account, TNC scores 5 out of 10 in our fundamental rating. TNC was compared to 129 industry peers in the Machinery industry. TNC has an average financial health and profitability rating. TNC is valued correctly, but it does not seem to be growing.
1. Profitability
1.1 Basic Checks
In the past year TNC was profitable.
TNC had a positive operating cash flow in the past year.
Of the past 5 years TNC 4 years were profitable.
The reported operating cash flow has been mixed in the past 5 years: TNC reported negative operating cash flow in multiple years.
1.2 Ratios
TNC has a Return On Assets of 8.89%. This is in the better half of the industry: TNC outperforms 76.00% of its industry peers.
TNC has a better Return On Equity (16.70%) than 74.40% of its industry peers.
The Return On Invested Capital of TNC (12.20%) is better than 76.80% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for TNC is in line with the industry average of 11.00%.
The last Return On Invested Capital (12.20%) for TNC is above the 3 year average (11.15%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.89% | ||
| ROE | 16.7% | ||
| ROIC | 12.2% |
ROA(3y)7.35%
ROA(5y)5.9%
ROE(3y)16.01%
ROE(5y)13.81%
ROIC(3y)11.15%
ROIC(5y)9.85%
1.3 Margins
TNC's Profit Margin of 8.52% is fine compared to the rest of the industry. TNC outperforms 64.00% of its industry peers.
TNC's Profit Margin has improved in the last couple of years.
TNC's Operating Margin of 10.54% is in line compared to the rest of the industry. TNC outperforms 54.40% of its industry peers.
TNC's Operating Margin has improved in the last couple of years.
TNC has a Gross Margin of 42.95%. This is in the better half of the industry: TNC outperforms 78.40% of its industry peers.
TNC's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 10.54% | ||
| PM (TTM) | 8.52% | ||
| GM | 42.95% |
OM growth 3Y18.38%
OM growth 5Y17.17%
PM growth 3Y37.78%
PM growth 5Y24.25%
GM growth 3Y1.35%
GM growth 5Y1.4%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so TNC is still creating some value.
There is no outstanding debt for TNC. This means it has a Debt/Equity and Debt/FCF ratio of 0 and it is amongst the best of the sector and industry.
2.2 Solvency
An Altman-Z score of 4.15 indicates that TNC is not in any danger for bankruptcy at the moment.
TNC has a Altman-Z score of 4.15. This is in the better half of the industry: TNC outperforms 67.20% of its industry peers.
TNC has a debt to FCF ratio of 2.16. This is a good value and a sign of high solvency as TNC would need 2.16 years to pay back of all of its debts.
TNC has a Debt to FCF ratio of 2.16. This is in the better half of the industry: TNC outperforms 79.20% of its industry peers.
A Debt/Equity ratio of 0.32 indicates that TNC is not too dependend on debt financing.
TNC has a Debt to Equity ratio of 0.32. This is in the better half of the industry: TNC outperforms 62.40% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.32 | ||
| Debt/FCF | 2.16 | ||
| Altman-Z | 4.15 |
ROIC/WACC1.14
WACC10.68%
2.3 Liquidity
A Current Ratio of 2.17 indicates that TNC has no problem at all paying its short term obligations.
TNC's Current ratio of 2.17 is in line compared to the rest of the industry. TNC outperforms 54.40% of its industry peers.
TNC has a Quick Ratio of 1.43. This is a normal value and indicates that TNC is financially healthy and should not expect problems in meeting its short term obligations.
TNC has a Quick ratio (1.43) which is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.17 | ||
| Quick Ratio | 1.43 |
3. Growth
3.1 Past
The earnings per share for TNC have decreased by -0.30% in the last year.
TNC shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 17.78% yearly.
EPS 1Y (TTM)-0.3%
EPS 3Y14.27%
EPS 5Y17.78%
EPS Q2Q%-20.83%
Revenue 1Y (TTM)N/A
Revenue growth 3YN/A
Revenue growth 5YN/A
Sales Q2Q%5.62%
3.2 Future
TNC is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 5.81% yearly.
TNC is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 3.38% yearly.
EPS Next Y1.46%
EPS Next 2Y5.81%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue Next Year3.55%
Revenue Next 2Y3.38%
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.
4. Valuation
4.1 Price/Earnings Ratio
TNC is valuated correctly with a Price/Earnings ratio of 13.26.
Based on the Price/Earnings ratio, TNC is valued cheaply inside the industry as 83.20% of the companies are valued more expensively.
Compared to an average S&P500 Price/Earnings ratio of 29.63, TNC is valued rather cheaply.
A Price/Forward Earnings ratio of 13.07 indicates a correct valuation of TNC.
Based on the Price/Forward Earnings ratio, TNC is valued cheaper than 89.60% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of TNC to the average of the S&P500 Index (22.68), we can say TNC is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.26 | ||
| Fwd PE | 13.07 |
4.2 Price Multiples
TNC's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. TNC is cheaper than 78.40% of the companies in the same industry.
82.40% of the companies in the same industry are more expensive than TNC, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 16.9 | ||
| EV/EBITDA | 9.32 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates TNC does not grow enough to justify the current Price/Earnings ratio.
TNC has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)9.07
PEG (5Y)0.75
EPS Next 2Y5.81%
EPS Next 3YN/A
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 1.32%, TNC has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 1.65, TNC pays a bit more dividend than its industry peers.
Compared to an average S&P500 Dividend Yield of 2.27, TNC's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.32% |
5.2 History
The dividend of TNC has a limited annual growth rate of 4.94%.
TNC has been paying a dividend for at least 10 years, so it has a reliable track record.
TNC has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)4.94%
Div Incr Years34
Div Non Decr Years34
5.3 Sustainability
19.61% of the earnings are spent on dividend by TNC. This is a low number and sustainable payout ratio.
TNC's earnings are growing around the same pace than its dividend. As long as the earnings growth is kept the dividend growth is sustainable.
DP19.61%
EPS Next 2Y5.81%
EPS Next 3YN/A
86.86
-2.3 (-2.58%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryMachinery
Earnings (Last)
Earnings (Next)
Inst Owners96.05%
Inst Owner Change2.04%
Ins Owners1.07%
Ins Owner Change-0.23%
Market Cap1.64B
Analysts85.71
Price Target130.56 (50.31%)
Short Float %3.35%
Short Ratio3.71
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.32% |
Yearly Dividend1.08
Dividend Growth(5Y)4.94%
DP19.61%
Div Incr Years34
Div Non Decr Years34
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)0.78%
Min EPS beat(2)-4.09%
Max EPS beat(2)5.65%
EPS beat(4)3
Avg EPS beat(4)19.93%
Min EPS beat(4)-4.09%
Max EPS beat(4)51.68%
EPS beat(8)7
Avg EPS beat(8)30.63%
EPS beat(12)9
Avg EPS beat(12)19.54%
EPS beat(16)13
Avg EPS beat(16)26.41%
Revenue beat(2)1
Avg Revenue beat(2)-0.96%
Min Revenue beat(2)-2.1%
Max Revenue beat(2)0.18%
Revenue beat(4)1
Avg Revenue beat(4)-0.82%
Min Revenue beat(4)-2.1%
Max Revenue beat(4)0.18%
Revenue beat(8)4
Avg Revenue beat(8)2.21%
Revenue beat(12)5
Avg Revenue beat(12)-0.21%
Revenue beat(16)7
Avg Revenue beat(16)0.21%
PT rev (1m)-1.16%
PT rev (3m)-1.16%
EPS NQ rev (1m)2.11%
EPS NQ rev (3m)2.11%
EPS NY rev (1m)0.5%
EPS NY rev (3m)0.5%
Revenue NQ rev (1m)-0.2%
Revenue NQ rev (3m)-0.2%
Revenue NY rev (1m)-0.08%
Revenue NY rev (3m)-0.08%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.26 | ||
| Fwd PE | 13.07 | ||
| P/S | 1.29 | ||
| P/FCF | 16.9 | ||
| P/OCF | 14.13 | ||
| P/B | 2.53 | ||
| P/tB | 4.29 | ||
| EV/EBITDA | 9.32 |
EPS(TTM)6.55
EY7.54%
EPS(NY)6.65
Fwd EY7.65%
FCF(TTM)5.14
FCFY5.92%
OCF(TTM)6.15
OCFY7.08%
SpS67.26
BVpS34.3
TBVpS20.27
PEG (NY)9.07
PEG (5Y)0.75
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.89% | ||
| ROE | 16.7% | ||
| ROCE | 14.19% | ||
| ROIC | 12.2% | ||
| ROICexc | 13.5% | ||
| ROICexgc | 19.6% | ||
| OM | 10.54% | ||
| PM (TTM) | 8.52% | ||
| GM | 42.95% | ||
| FCFM | 7.64% |
ROA(3y)7.35%
ROA(5y)5.9%
ROE(3y)16.01%
ROE(5y)13.81%
ROIC(3y)11.15%
ROIC(5y)9.85%
ROICexc(3y)12.87%
ROICexc(5y)11.36%
ROICexgc(3y)20.81%
ROICexgc(5y)19.42%
ROCE(3y)12.98%
ROCE(5y)11.47%
ROICexcg growth 3Y15.61%
ROICexcg growth 5Y11.23%
ROICexc growth 3Y25.19%
ROICexc growth 5Y17.36%
OM growth 3Y18.38%
OM growth 5Y17.17%
PM growth 3Y37.78%
PM growth 5Y24.25%
GM growth 3Y1.35%
GM growth 5Y1.4%
F-Score6
Asset Turnover1.04
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.32 | ||
| Debt/FCF | 2.16 | ||
| Debt/EBITDA | 1.11 | ||
| Cap/Depr | 34.73% | ||
| Cap/Sales | 1.5% | ||
| Interest Coverage | 9.77 | ||
| Cash Conversion | 61.54% | ||
| Profit Quality | 89.73% | ||
| Current Ratio | 2.17 | ||
| Quick Ratio | 1.43 | ||
| Altman-Z | 4.15 |
F-Score6
WACC10.68%
ROIC/WACC1.14
Cap/Depr(3y)44.23%
Cap/Depr(5y)52.07%
Cap/Sales(3y)1.97%
Cap/Sales(5y)2.47%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-0.3%
EPS 3Y14.27%
EPS 5Y17.78%
EPS Q2Q%-20.83%
EPS Next Y1.46%
EPS Next 2Y5.81%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue 1Y (TTM)N/A
Revenue growth 3YN/A
Revenue growth 5YN/A
Sales Q2Q%5.62%
Revenue Next Year3.55%
Revenue Next 2Y3.38%
Revenue Next 3YN/A
Revenue Next 5YN/A
EBIT growth 1Y-9.29%
EBIT growth 3Y27.26%
EBIT growth 5Y19.58%
EBIT Next Year43.68%
EBIT Next 3Y15.33%
EBIT Next 5YN/A
FCF growth 1Y264.13%
FCF growth 3Y16.85%
FCF growth 5Y23.18%
OCF growth 1Y459.13%
OCF growth 3Y12.08%
OCF growth 5Y18.69%