TENNANT CO (TNC) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:TNC - US8803451033 - Common Stock
75.52 USD
-0.91 (-1.19%)
Overall TNC gets a fundamental rating of 5 out of 10. We evaluated TNC against 132 industry peers in the Machinery industry. Both the profitability and the financial health of TNC get a neutral evaluation. Nothing too spectacular is happening here. TNC has a valuation in line with the averages, but on the other hand it scores bad on growth.
1. Profitability
1.1 Basic Checks
- In the past year TNC was profitable.
- In the past year TNC had a positive cash flow from operations.
- TNC had positive earnings in each of the past 5 years.
- TNC had a positive operating cash flow in 4 of the past 5 years.
1.2 Ratios
- Looking at the Return On Assets, with a value of 4.36%, TNC is in line with its industry, outperforming 56.06% of the companies in the same industry.
- TNC has a Return On Equity (8.55%) which is comparable to the rest of the industry.
- With a decent Return On Invested Capital value of 8.14%, TNC is doing good in the industry, outperforming 61.36% of the companies in the same industry.
- TNC had an Average Return On Invested Capital over the past 3 years of 11.55%. This is in line with the industry average of 10.24%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.36% | ||
| ROE | 8.55% | ||
| ROIC | 8.14% |
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 4.42% is in line compared to the rest of the industry. TNC outperforms 51.52% of its industry peers.
- TNC's Profit Margin has improved in the last couple of years.
- TNC has a Operating Margin (7.61%) which is comparable to the rest of the industry.
- TNC's Operating Margin has improved in the last couple of years.
- TNC has a Gross Margin of 41.88%. This is in the better half of the industry: TNC outperforms 79.55% of its industry peers.
- 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 | 7.61% | ||
| PM (TTM) | 4.42% | ||
| GM | 41.88% |
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
- TNC has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
- TNC has about the same amout of shares outstanding than it did 1 year ago.
- TNC has more shares outstanding than it did 5 years ago.
- Compared to 1 year ago, TNC has an improved debt to assets ratio.
2.2 Solvency
- TNC has an Altman-Z score of 3.60. This indicates that TNC is financially healthy and has little risk of bankruptcy at the moment.
- With a decent Altman-Z score value of 3.60, TNC is doing good in the industry, outperforming 60.61% of the companies in the same industry.
- The Debt to FCF ratio of TNC is 3.87, which is a good value as it means it would take TNC, 3.87 years of fcf income to pay off all of its debts.
- TNC has a Debt to FCF ratio (3.87) which is in line with its industry peers.
- TNC has a Debt/Equity ratio of 0.37. This is a healthy value indicating a solid balance between debt and equity.
- With a Debt to Equity ratio value of 0.37, TNC perfoms like the industry average, outperforming 58.33% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.37 | ||
| Debt/FCF | 3.87 | ||
| Altman-Z | 3.6 |
ROIC/WACC0.84
WACC9.72%
2.3 Liquidity
- A Current Ratio of 2.13 indicates that TNC has no problem at all paying its short term obligations.
- Looking at the Current ratio, with a value of 2.13, TNC is in line with its industry, outperforming 53.79% of the companies in the same industry.
- TNC has a Quick Ratio of 1.39. This is a normal value and indicates that TNC is financially healthy and should not expect problems in meeting its short term obligations.
- With a decent Quick ratio value of 1.39, TNC is doing good in the industry, outperforming 60.61% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.13 | ||
| Quick Ratio | 1.39 |
3. Growth
3.1 Past
- The earnings per share for TNC have decreased strongly by -19.57% in the last year.
- Measured over the past years, TNC shows a quite strong growth in Earnings Per Share. The EPS has been growing by 17.78% on average per year.
- The Revenue has decreased by -2.24% in the past year.
- Measured over the past years, TNC shows a small growth in Revenue. The Revenue has been growing by 2.49% on average per year.
EPS 1Y (TTM)-19.57%
EPS 3Y14.27%
EPS 5Y17.78%
EPS Q2Q%5.04%
Revenue 1Y (TTM)-2.24%
Revenue growth 3Y5.66%
Revenue growth 5Y2.49%
Sales Q2Q%-3.96%
3.2 Future
- TNC is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 4.36% yearly.
- TNC is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 3.86% yearly.
EPS Next Y-11.03%
EPS Next 2Y1.39%
EPS Next 3Y4.36%
EPS Next 5YN/A
Revenue Next Year-3.86%
Revenue Next 2Y0.77%
Revenue Next 3Y2.19%
Revenue Next 5Y3.86%
3.3 Evolution
- The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
- When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
- Based on the Price/Earnings ratio of 13.51, the valuation of TNC can be described as correct.
- Based on the Price/Earnings ratio, TNC is valued cheaper than 91.67% of the companies in the same industry.
- When comparing the Price/Earnings ratio of TNC to the average of the S&P500 Index (27.25), we can say TNC is valued rather cheaply.
- TNC is valuated reasonably with a Price/Forward Earnings ratio of 11.22.
- Compared to the rest of the industry, the Price/Forward Earnings ratio of TNC indicates a rather cheap valuation: TNC is cheaper than 94.70% of the companies listed in the same industry.
- TNC's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 25.98.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.51 | ||
| Fwd PE | 11.22 |
4.2 Price Multiples
- Based on the Enterprise Value to EBITDA ratio, TNC is valued cheaper than 84.09% of the companies in the same industry.
- Based on the Price/Free Cash Flow ratio, TNC is valued a bit cheaper than 64.39% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 22.19 | ||
| EV/EBITDA | 10.04 |
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)0.76
EPS Next 2Y1.39%
EPS Next 3Y4.36%
5. Dividend
5.1 Amount
- TNC has a Yearly Dividend Yield of 1.57%.
- Compared to an average industry Dividend Yield of 1.01, TNC pays a better dividend. On top of this TNC pays more dividend than 83.33% of the companies listed in the same industry.
- TNC's Dividend Yield is comparable with the S&P500 average which is at 1.82.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.57% |
5.2 History
- The dividend of TNC has a limited annual growth rate of 5.49%.
- TNC has been paying a dividend for at least 10 years, so it has 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
- TNC pays out 39.96% of its income as dividend. This is a sustainable payout ratio.
- TNC's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP39.96%
EPS Next 2Y1.39%
EPS Next 3Y4.36%
TENNANT CO / TNC FAQ
What is the ChartMill fundamental rating of TENNANT CO (TNC) stock?
ChartMill assigns a fundamental rating of 5 / 10 to TNC.
Can you provide the valuation status for TENNANT CO?
ChartMill assigns a valuation rating of 6 / 10 to TENNANT CO (TNC). This can be considered as Fairly Valued.
How profitable is TENNANT CO (TNC) stock?
TENNANT CO (TNC) has a profitability rating of 6 / 10.
What is the financial health of TENNANT CO (TNC) stock?
The financial health rating of TENNANT CO (TNC) is 6 / 10.
What is the expected EPS growth for TENNANT CO (TNC) stock?
The Earnings per Share (EPS) of TENNANT CO (TNC) is expected to decline by -11.03% in the next year.