TENNANT CO (TNC) Stock Fundamental Analysis
NYSE:TNC - New York Stock Exchange, Inc. - US8803451033 - Common Stock - Currency: USD
TNC gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 128 industry peers in the Machinery industry. TNC has only an average score on both its financial health and profitability. TNC is valued correctly, but it does not seem to be growing.
1. Profitability
1.1 Basic Checks
TNC had positive earnings in the past year.
In the past year TNC had a positive cash flow from operations.
In the past 5 years TNC has always been profitable.
Of the past 5 years TNC 4 years had a positive operating cash flow.
1.2 Ratios
The Return On Assets of TNC (5.80%) is better than 60.94% of its industry peers.
Looking at the Return On Equity, with a value of 10.95%, TNC is in line with its industry, outperforming 58.59% of the companies in the same industry.
TNC's Return On Invested Capital of 10.06% is fine compared to the rest of the industry. TNC outperforms 68.75% 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 10.71%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.8% | ||
| ROE | 10.95% | ||
| ROIC | 10.06% |
ROA(3y)7.66%
ROA(5y)6.44%
ROE(3y)15.51%
ROE(5y)13.97%
ROIC(3y)11.55%
ROIC(5y)10.25%
1.3 Margins
TNC's Profit Margin of 5.40% is in line compared to the rest of the industry. TNC outperforms 50.78% of its industry peers.
In the last couple of years the Profit Margin of TNC has grown nicely.
TNC has a Operating Margin of 8.71%. This is comparable to the rest of the industry: TNC outperforms 50.00% of its industry peers.
TNC's Operating Margin has improved in the last couple of years.
With a decent Gross Margin value of 42.08%, TNC is doing good in the industry, outperforming 78.13% of the companies in the same industry.
In the last couple of years the Gross Margin of TNC has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 8.71% | ||
| PM (TTM) | 5.4% | ||
| GM | 42.08% |
OM growth 3Y5.7%
OM growth 5Y6.37%
PM growth 3Y3.02%
PM growth 5Y10.07%
GM growth 3Y2.05%
GM growth 5Y1.03%
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.
TNC has about the same amout of shares outstanding than it did 1 year ago.
Compared to 5 years ago, TNC has more shares outstanding
TNC has a better debt/assets ratio than last year.
2.2 Solvency
TNC has an Altman-Z score of 4.02. This indicates that TNC is financially healthy and has little risk of bankruptcy at the moment.
With a decent Altman-Z score value of 4.02, TNC is doing good in the industry, outperforming 66.41% of the companies in the same industry.
TNC has a debt to FCF ratio of 3.48. This is a good value and a sign of high solvency as TNC would need 3.48 years to pay back of all of its debts.
The Debt to FCF ratio of TNC (3.48) is better than 61.72% of its industry peers.
TNC has a Debt/Equity ratio of 0.34. This is a healthy value indicating a solid balance between debt and equity.
TNC has a Debt to Equity ratio of 0.34. This is comparable to the rest of the industry: TNC outperforms 58.59% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.34 | ||
| Debt/FCF | 3.48 | ||
| Altman-Z | 4.02 |
ROIC/WACC0.99
WACC10.17%
2.3 Liquidity
TNC has a Current Ratio of 2.14. This indicates that TNC is financially healthy and has no problem in meeting its short term obligations.
Looking at the Current ratio, with a value of 2.14, TNC is in line with its industry, outperforming 56.25% of the companies in the same industry.
A Quick Ratio of 1.40 indicates that TNC should not have too much problems paying its short term obligations.
With a Quick ratio value of 1.40, TNC perfoms like the industry average, outperforming 59.38% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.14 | ||
| Quick Ratio | 1.4 |
3. Growth
3.1 Past
TNC shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -15.44%.
The Earnings Per Share has been growing by 17.78% on average over the past years. This is quite good.
The Revenue has been growing slightly by 1.35% in the past year.
TNC shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 2.49% yearly.
EPS 1Y (TTM)-15.44%
EPS 3Y14.27%
EPS 5Y17.78%
EPS Q2Q%-38.12%
Revenue 1Y (TTM)1.35%
Revenue growth 3Y5.66%
Revenue growth 5Y2.49%
Sales Q2Q%-6.75%
3.2 Future
Based on estimates for the next years, TNC will show a decrease in Earnings Per Share. The EPS will decrease by -0.58% on average per year.
The Revenue is expected to decrease by -0.74% on average over the next years.
EPS Next Y-10.64%
EPS Next 2Y-0.58%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue Next Year-5.49%
Revenue Next 2Y-0.74%
Revenue Next 3YN/A
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.
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
The Price/Earnings ratio is 14.05, which indicates a correct valuation of TNC.
Based on the Price/Earnings ratio, TNC is valued cheaply inside the industry as 85.94% of the companies are valued more expensively.
TNC is valuated rather cheaply when we compare the Price/Earnings ratio to 27.28, which is the current average of the S&P500 Index.
The Price/Forward Earnings ratio is 12.71, which indicates a correct valuation of TNC.
Compared to the rest of the industry, the Price/Forward Earnings ratio of TNC indicates a rather cheap valuation: TNC is cheaper than 82.03% of the companies listed in the same industry.
TNC's Price/Forward Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 21.76.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 14.05 | ||
| Fwd PE | 12.71 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, TNC is valued a bit cheaper than 78.13% of the companies in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of TNC is on the same level as its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 24.96 | ||
| EV/EBITDA | 9.77 |
4.3 Compensation for Growth
TNC has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)0.79
EPS Next 2Y-0.58%
EPS Next 3YN/A
5. Dividend
5.1 Amount
TNC has a Yearly Dividend Yield of 1.52%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 1.88, TNC pays a bit more dividend than its industry peers.
TNC's Dividend Yield is slightly below the S&P500 average, which is at 2.42.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.52% |
5.2 History
The dividend of TNC has a limited annual growth rate of 5.49%.
TNC has paid a dividend for at least 10 years, which is a reliable track record.
TNC has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)5.49%
Div Incr Years34
Div Non Decr Years34
5.3 Sustainability
31.73% of the earnings are spent on dividend by TNC. This is a low number and sustainable payout ratio.
DP31.73%
EPS Next 2Y-0.58%
EPS Next 3YN/A
82.31
+2.59 (+3.25%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryMachinery
Earnings (Last)
Earnings (Next)
Inst Owners97.06%
Inst Owner Change0.08%
Ins Owners1.38%
Ins Owner Change11.38%
Market Cap1.54B
Analysts86.67
Price Target122.4 (48.71%)
Short Float %2.51%
Short Ratio3.29
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.52% |
Yearly Dividend1.15
Dividend Growth(5Y)5.49%
DP31.73%
Div Incr Years34
Div Non Decr Years34
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-2.67%
Min EPS beat(2)-14.92%
Max EPS beat(2)9.58%
EPS beat(4)2
Avg EPS beat(4)-0.94%
Min EPS beat(4)-14.92%
Max EPS beat(4)9.58%
EPS beat(8)6
Avg EPS beat(8)18.62%
EPS beat(12)9
Avg EPS beat(12)19.51%
EPS beat(16)12
Avg EPS beat(16)18.82%
Revenue beat(2)1
Avg Revenue beat(2)-1.23%
Min Revenue beat(2)-3.2%
Max Revenue beat(2)0.74%
Revenue beat(4)2
Avg Revenue beat(4)-1.1%
Min Revenue beat(4)-3.2%
Max Revenue beat(4)0.74%
Revenue beat(8)4
Avg Revenue beat(8)0.65%
Revenue beat(12)6
Avg Revenue beat(12)0.52%
Revenue beat(16)7
Avg Revenue beat(16)-0.31%
PT rev (1m)0.56%
PT rev (3m)-7.22%
EPS NQ rev (1m)-0.91%
EPS NQ rev (3m)0.62%
EPS NY rev (1m)-0.6%
EPS NY rev (3m)-2.28%
Revenue NQ rev (1m)0.52%
Revenue NQ rev (3m)-0.79%
Revenue NY rev (1m)-1.05%
Revenue NY rev (3m)-4.82%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 14.05 | ||
| Fwd PE | 12.71 | ||
| P/S | 1.21 | ||
| P/FCF | 24.96 | ||
| P/OCF | 17.77 | ||
| P/B | 2.46 | ||
| P/tB | 4.1 | ||
| EV/EBITDA | 9.77 |
EPS(TTM)5.86
EY7.12%
EPS(NY)6.47
Fwd EY7.87%
FCF(TTM)3.3
FCFY4.01%
OCF(TTM)4.63
OCFY5.63%
SpS67.87
BVpS33.48
TBVpS20.07
PEG (NY)N/A
PEG (5Y)0.79
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.8% | ||
| ROE | 10.95% | ||
| ROCE | 11.95% | ||
| ROIC | 10.06% | ||
| ROICexc | 11.01% | ||
| ROICexgc | 15.65% | ||
| OM | 8.71% | ||
| PM (TTM) | 5.4% | ||
| GM | 42.08% | ||
| FCFM | 4.86% |
ROA(3y)7.66%
ROA(5y)6.44%
ROE(3y)15.51%
ROE(5y)13.97%
ROIC(3y)11.55%
ROIC(5y)10.25%
ROICexc(3y)13.11%
ROICexc(5y)11.83%
ROICexgc(3y)19.67%
ROICexgc(5y)19.23%
ROCE(3y)13.73%
ROCE(5y)12.18%
ROICexcg growth 3Y-3.55%
ROICexcg growth 5Y1.17%
ROICexc growth 3Y4.18%
ROICexc growth 5Y6.62%
OM growth 3Y5.7%
OM growth 5Y6.37%
PM growth 3Y3.02%
PM growth 5Y10.07%
GM growth 3Y2.05%
GM growth 5Y1.03%
F-Score4
Asset Turnover1.07
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.34 | ||
| Debt/FCF | 3.48 | ||
| Debt/EBITDA | 1.29 | ||
| Cap/Depr | 44.78% | ||
| Cap/Sales | 1.97% | ||
| Interest Coverage | 9.19 | ||
| Cash Conversion | 52.08% | ||
| Profit Quality | 89.91% | ||
| Current Ratio | 2.14 | ||
| Quick Ratio | 1.4 | ||
| Altman-Z | 4.02 |
F-Score4
WACC10.17%
ROIC/WACC0.99
Cap/Depr(3y)44.63%
Cap/Depr(5y)45.36%
Cap/Sales(3y)1.92%
Cap/Sales(5y)2.11%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-15.44%
EPS 3Y14.27%
EPS 5Y17.78%
EPS Q2Q%-38.12%
EPS Next Y-10.64%
EPS Next 2Y-0.58%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue 1Y (TTM)1.35%
Revenue growth 3Y5.66%
Revenue growth 5Y2.49%
Sales Q2Q%-6.75%
Revenue Next Year-5.49%
Revenue Next 2Y-0.74%
Revenue Next 3YN/A
Revenue Next 5YN/A
EBIT growth 1Y-23.08%
EBIT growth 3Y11.69%
EBIT growth 5Y9.02%
EBIT Next Year42.64%
EBIT Next 3YN/A
EBIT Next 5YN/A
FCF growth 1Y674.77%
FCF growth 3Y11.3%
FCF growth 5Y15.83%
OCF growth 1Y436.65%
OCF growth 3Y8.93%
OCF growth 5Y4.52%