TRANE TECHNOLOGIES PLC (TT) Stock Fundamental Analysis
USA - NYSE:TT - IE00BK9ZQ967 - Common Stock
426.36 USD
-1.92 (-0.45%)
426.36 USD
0 (0%)
We assign a fundamental rating of 7 out of 10 to TT. TT was compared to 41 industry peers in the Building Products industry. Both the health and profitability get an excellent rating, making TT a very profitable company, without any liquidiy or solvency issues. While showing a medium growth rate, TT is valued expensive at the moment. These ratings would make TT suitable for quality investing!
1. Profitability
1.1 Basic Checks
TT had positive earnings in the past year.
In the past year TT had a positive cash flow from operations.
TT had positive earnings in each of the past 5 years.
Each year in the past 5 years TT had a positive operating cash flow.
1.2 Ratios
TT's Return On Assets of 13.61% is amongst the best of the industry. TT outperforms 82.93% of its industry peers.
TT has a Return On Equity of 36.46%. This is amongst the best in the industry. TT outperforms 92.68% of its industry peers.
The Return On Invested Capital of TT (21.67%) is better than 90.24% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for TT is significantly above the industry average of 12.64%.
The 3 year average ROIC (17.76%) for TT is below the current ROIC(21.67%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 13.61% | ||
| ROE | 36.46% | ||
| ROIC | 21.67% |
ROA(3y)10.97%
ROA(5y)9.1%
ROE(3y)30.74%
ROE(5y)25.66%
ROIC(3y)17.76%
ROIC(5y)15.01%
1.3 Margins
The Profit Margin of TT (13.76%) is better than 73.17% of its industry peers.
In the last couple of years the Profit Margin of TT has grown nicely.
TT's Operating Margin of 18.39% is fine compared to the rest of the industry. TT outperforms 73.17% of its industry peers.
TT's Operating Margin has improved in the last couple of years.
TT has a Gross Margin (36.26%) which is in line with its industry peers.
In the last couple of years the Gross Margin of TT has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 18.39% | ||
| PM (TTM) | 13.76% | ||
| GM | 36.26% |
OM growth 3Y6.75%
OM growth 5Y6.01%
PM growth 3Y8.74%
PM growth 5Y3.71%
GM growth 3Y4.06%
GM growth 5Y2.99%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is well above the Cost of Capital (WACC), so TT is creating value.
Compared to 1 year ago, TT has less shares outstanding
TT has less shares outstanding than it did 5 years ago.
Compared to 1 year ago, TT has an improved debt to assets ratio.
2.2 Solvency
An Altman-Z score of 6.63 indicates that TT is not in any danger for bankruptcy at the moment.
The Altman-Z score of TT (6.63) is better than 75.61% of its industry peers.
The Debt to FCF ratio of TT is 1.64, which is an excellent value as it means it would take TT, only 1.64 years of fcf income to pay off all of its debts.
TT has a better Debt to FCF ratio (1.64) than 80.49% of its industry peers.
TT has a Debt/Equity ratio of 0.50. This is a neutral value indicating TT is somewhat dependend on debt financing.
The Debt to Equity ratio of TT (0.50) is comparable to the rest of the industry.
Even though the debt/equity ratio score it not favorable for TT, it has very limited outstanding debt, so we won't put too much weight on the DE evaluation.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.5 | ||
| Debt/FCF | 1.64 | ||
| Altman-Z | 6.63 |
ROIC/WACC2.92
WACC7.41%
2.3 Liquidity
A Current Ratio of 1.10 indicates that TT should not have too much problems paying its short term obligations.
TT has a Current ratio of 1.10. This is amonst the worse of the industry: TT underperforms 82.93% of its industry peers.
A Quick Ratio of 0.76 indicates that TT may have some problems paying its short term obligations.
TT has a Quick ratio of 0.76. This is amonst the worse of the industry: TT underperforms 82.93% of its industry peers.
The current and quick ratio evaluation for TT is rather negative, while it does have excellent solvency and profitability. These ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.1 | ||
| Quick Ratio | 0.76 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 20.69% over the past year.
Measured over the past years, TT shows a quite strong growth in Earnings Per Share. The EPS has been growing by 11.99% on average per year.
The Revenue has grown by 10.20% in the past year. This is quite good.
TT shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 8.69% yearly.
EPS 1Y (TTM)20.69%
EPS 3Y22.59%
EPS 5Y11.99%
EPS Q2Q%17.58%
Revenue 1Y (TTM)10.2%
Revenue growth 3Y11.96%
Revenue growth 5Y8.69%
Sales Q2Q%8.27%
3.2 Future
The Earnings Per Share is expected to grow by 10.27% on average over the next years. This is quite good.
Based on estimates for the next years, TT will show a small growth in Revenue. The Revenue will grow by 7.20% on average per year.
EPS Next Y19.26%
EPS Next 2Y16.22%
EPS Next 3Y15.09%
EPS Next 5Y10.27%
Revenue Next Year8.73%
Revenue Next 2Y8.13%
Revenue Next 3Y7.79%
Revenue Next 5Y7.2%
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 stable.
The Revenue growth rate is stable: in the next years the growth will be about the same than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 34.64, which means the current valuation is very expensive for TT.
Based on the Price/Earnings ratio, TT is valued a bit more expensive than 75.61% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 27.08, TT is valued a bit more expensive.
The Price/Forward Earnings ratio is 28.13, which means the current valuation is very expensive for TT.
TT's Price/Forward Earnings ratio is a bit more expensive when compared to the industry. TT is more expensive than 70.73% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of TT to the average of the S&P500 Index (23.09), we can say TT is valued slightly more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 34.64 | ||
| Fwd PE | 28.13 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, TT is valued a bit more expensive than the industry average as 75.61% of the companies are valued more cheaply.
TT's Price/Free Cash Flow is on the same level as the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 33.75 | ||
| EV/EBITDA | 23.58 |
4.3 Compensation for Growth
The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
The excellent profitability rating of TT may justify a higher PE ratio.
A more expensive valuation may be justified as TT's earnings are expected to grow with 15.09% in the coming years.
PEG (NY)1.8
PEG (5Y)2.89
EPS Next 2Y16.22%
EPS Next 3Y15.09%
5. Dividend
5.1 Amount
With a yearly dividend of 0.90%, TT is not a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 1.24, TT pays a bit more dividend than its industry peers.
With a Dividend Yield of 0.90, TT pays less dividend than the S&P500 average, which is at 2.30.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.9% |
5.2 History
The dividend of TT is nicely growing with an annual growth rate of 9.56%!
TT has paid a dividend for at least 10 years, which is a reliable track record.
TT has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)9.56%
Div Incr Years14
Div Non Decr Years14
5.3 Sustainability
TT pays out 27.94% of its income as dividend. This is a sustainable payout ratio.
The dividend of TT is growing around the same rate as the earnings are growing. If this keeps up the dividend growth is sustainable.
DP27.94%
EPS Next 2Y16.22%
EPS Next 3Y15.09%
426.36
-1.92 (-0.45%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryBuilding Products
Earnings (Last)
Earnings (Next)
Inst Owners90.82%
Inst Owner Change-0.11%
Ins Owners0.26%
Ins Owner Change0.24%
Market Cap94.87B
Revenue(TTM)20.75B
Net Income(TTM)2.86B
Analysts71.18
Price Target467.25 (9.59%)
Short Float %1.33%
Short Ratio2.4
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.9% |
Yearly Dividend3.35
Dividend Growth(5Y)9.56%
DP27.94%
Div Incr Years14
Div Non Decr Years14
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)3.41%
Min EPS beat(2)-0.67%
Max EPS beat(2)7.49%
EPS beat(4)2
Avg EPS beat(4)1.81%
Min EPS beat(4)-0.67%
Max EPS beat(4)7.49%
EPS beat(8)5
Avg EPS beat(8)3.11%
EPS beat(12)9
Avg EPS beat(12)3.38%
EPS beat(16)11
Avg EPS beat(16)2.86%
Revenue beat(2)1
Avg Revenue beat(2)-0.88%
Min Revenue beat(2)-3.39%
Max Revenue beat(2)1.64%
Revenue beat(4)1
Avg Revenue beat(4)-0.92%
Min Revenue beat(4)-3.39%
Max Revenue beat(4)1.64%
Revenue beat(8)3
Avg Revenue beat(8)-0.67%
Revenue beat(12)5
Avg Revenue beat(12)-0.47%
Revenue beat(16)6
Avg Revenue beat(16)-0.64%
PT rev (1m)-0.49%
PT rev (3m)6.3%
EPS NQ rev (1m)-0.85%
EPS NQ rev (3m)-0.98%
EPS NY rev (1m)-0.42%
EPS NY rev (3m)0.39%
Revenue NQ rev (1m)-2.81%
Revenue NQ rev (3m)-3.68%
Revenue NY rev (1m)-0.55%
Revenue NY rev (3m)-0.43%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 34.64 | ||
| Fwd PE | 28.13 | ||
| P/S | 4.57 | ||
| P/FCF | 33.75 | ||
| P/OCF | 29.34 | ||
| P/B | 12.11 | ||
| P/tB | N/A | ||
| EV/EBITDA | 23.58 |
EPS(TTM)12.31
EY2.89%
EPS(NY)15.16
Fwd EY3.55%
FCF(TTM)12.63
FCFY2.96%
OCF(TTM)14.53
OCFY3.41%
SpS93.25
BVpS35.21
TBVpS-8.63
PEG (NY)1.8
PEG (5Y)2.89
Graham Number98.75
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 13.61% | ||
| ROE | 36.46% | ||
| ROCE | 26.89% | ||
| ROIC | 21.67% | ||
| ROICexc | 22.92% | ||
| ROICexgc | 83.99% | ||
| OM | 18.39% | ||
| PM (TTM) | 13.76% | ||
| GM | 36.26% | ||
| FCFM | 13.55% |
ROA(3y)10.97%
ROA(5y)9.1%
ROE(3y)30.74%
ROE(5y)25.66%
ROIC(3y)17.76%
ROIC(5y)15.01%
ROICexc(3y)19.7%
ROICexc(5y)17.25%
ROICexgc(3y)86.55%
ROICexgc(5y)79.73%
ROCE(3y)22.03%
ROCE(5y)18.62%
ROICexgc growth 3Y9.37%
ROICexgc growth 5Y29.75%
ROICexc growth 3Y15.09%
ROICexc growth 5Y17.85%
OM growth 3Y6.75%
OM growth 5Y6.01%
PM growth 3Y8.74%
PM growth 5Y3.71%
GM growth 3Y4.06%
GM growth 5Y2.99%
F-Score8
Asset Turnover0.99
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.5 | ||
| Debt/FCF | 1.64 | ||
| Debt/EBITDA | 0.93 | ||
| Cap/Depr | 108.69% | ||
| Cap/Sales | 2.04% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 76.93% | ||
| Profit Quality | 98.44% | ||
| Current Ratio | 1.1 | ||
| Quick Ratio | 0.76 | ||
| Altman-Z | 6.63 |
F-Score8
WACC7.41%
ROIC/WACC2.92
Cap/Depr(3y)91.41%
Cap/Depr(5y)79.68%
Cap/Sales(3y)1.8%
Cap/Sales(5y)1.63%
Profit Quality(3y)93.42%
Profit Quality(5y)105.39%
High Growth Momentum
Growth
EPS 1Y (TTM)20.69%
EPS 3Y22.59%
EPS 5Y11.99%
EPS Q2Q%17.58%
EPS Next Y19.26%
EPS Next 2Y16.22%
EPS Next 3Y15.09%
EPS Next 5Y10.27%
Revenue 1Y (TTM)10.2%
Revenue growth 3Y11.96%
Revenue growth 5Y8.69%
Sales Q2Q%8.27%
Revenue Next Year8.73%
Revenue Next 2Y8.13%
Revenue Next 3Y7.79%
Revenue Next 5Y7.2%
EBIT growth 1Y18.49%
EBIT growth 3Y19.52%
EBIT growth 5Y15.23%
EBIT Next Year25.27%
EBIT Next 3Y14.95%
EBIT Next 5Y8.89%
FCF growth 1Y84.83%
FCF growth 3Y26.67%
FCF growth 5Y10.75%
OCF growth 1Y79.37%
OCF growth 3Y25.58%
OCF growth 5Y10.38%
TRANE TECHNOLOGIES PLC / TT FAQ
What is the fundamental rating for TT stock?
ChartMill assigns a fundamental rating of 7 / 10 to TT.
What is the valuation status for TT stock?
ChartMill assigns a valuation rating of 2 / 10 to TRANE TECHNOLOGIES PLC (TT). This can be considered as Overvalued.
What is the profitability of TT stock?
TRANE TECHNOLOGIES PLC (TT) has a profitability rating of 9 / 10.
What are the PE and PB ratios of TRANE TECHNOLOGIES PLC (TT) stock?
The Price/Earnings (PE) ratio for TRANE TECHNOLOGIES PLC (TT) is 34.64 and the Price/Book (PB) ratio is 12.11.
Is the dividend of TRANE TECHNOLOGIES PLC sustainable?
The dividend rating of TRANE TECHNOLOGIES PLC (TT) is 6 / 10 and the dividend payout ratio is 27.94%.