TRANE TECHNOLOGIES PLC (TT) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:TT - IE00BK9ZQ967 - Common Stock
419.64 USD
+0.82 (+0.2%)
419.64 USD
0 (0%)
Taking everything into account, TT scores 7 out of 10 in our fundamental rating. TT was compared to 41 industry peers in the Building Products industry. TT scores excellent points on both the profitability and health parts. This is a solid base for a good stock. TT is valied quite expensively at the moment, while it does show a decent growth rate. 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.
TT had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
With an excellent Return On Assets value of 13.72%, TT belongs to the best of the industry, outperforming 85.37% of the companies in the same industry.
TT's Return On Equity of 35.21% is amongst the best of the industry. TT outperforms 92.68% of its industry peers.
With an excellent Return On Invested Capital value of 21.47%, TT belongs to the best of the industry, outperforming 90.24% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for TT is significantly above the industry average of 12.49%.
The last Return On Invested Capital (21.47%) for TT is above the 3 year average (17.76%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 13.72% | ||
| ROE | 35.21% | ||
| ROIC | 21.47% |
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
Looking at the Profit Margin, with a value of 13.93%, TT is in the better half of the industry, outperforming 70.73% of the companies in the same industry.
In the last couple of years the Profit Margin of TT has grown nicely.
TT has a Operating Margin of 18.79%. This is in the better half of the industry: TT outperforms 73.17% of its industry peers.
In the last couple of years the Operating Margin of TT has grown nicely.
TT has a better Gross Margin (36.42%) than 63.41% of its industry peers.
In the last couple of years the Gross Margin of TT has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 18.79% | ||
| PM (TTM) | 13.93% | ||
| GM | 36.42% |
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.
TT has less shares outstanding than it did 1 year ago.
Compared to 5 years ago, TT has less shares outstanding
TT has a better debt/assets ratio than last year.
2.2 Solvency
TT has an Altman-Z score of 6.63. This indicates that TT is financially healthy and has little risk of bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 6.63, TT is in the better half of the industry, outperforming 78.05% of the companies in the same industry.
The Debt to FCF ratio of TT is 1.82, which is an excellent value as it means it would take TT, only 1.82 years of fcf income to pay off all of its debts.
TT has a Debt to FCF ratio of 1.82. This is in the better half of the industry: TT outperforms 75.61% of its industry peers.
A Debt/Equity ratio of 0.47 indicates that TT is not too dependend on debt financing.
TT has a Debt to Equity ratio (0.47) which is in line with its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.47 | ||
| Debt/FCF | 1.82 | ||
| Altman-Z | 6.63 |
ROIC/WACC2.93
WACC7.34%
2.3 Liquidity
A Current Ratio of 1.20 indicates that TT should not have too much problems paying its short term obligations.
TT has a worse Current ratio (1.20) than 82.93% of its industry peers.
A Quick Ratio of 0.84 indicates that TT may have some problems paying its short term obligations.
TT's Quick ratio of 0.84 is on the low side compared to the rest of the industry. TT is outperformed by 78.05% 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 | 1.2 | ||
| Quick Ratio | 0.84 |
3. Growth
3.1 Past
TT shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 18.92%, which is quite good.
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 8.58% 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)18.92%
EPS 3Y22.59%
EPS 5Y11.99%
EPS Q2Q%15.13%
Revenue 1Y (TTM)8.58%
Revenue growth 3Y11.96%
Revenue growth 5Y8.69%
Sales Q2Q%5.54%
3.2 Future
TT is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 10.27% yearly.
TT is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 7.20% yearly.
EPS Next Y19.68%
EPS Next 2Y16.69%
EPS Next 3Y15.45%
EPS Next 5Y10.27%
Revenue Next Year8.23%
Revenue Next 2Y7.92%
Revenue Next 3Y7.78%
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
TT is valuated quite expensively with a Price/Earnings ratio of 32.73.
75.61% of the companies in the same industry are cheaper than TT, based on the Price/Earnings ratio.
TT is valuated rather expensively when we compare the Price/Earnings ratio to 26.15, which is the current average of the S&P500 Index.
TT is valuated quite expensively with a Price/Forward Earnings ratio of 27.47.
Based on the Price/Forward Earnings ratio, TT is valued a bit 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 (36.12), we can say TT is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 32.73 | ||
| Fwd PE | 27.47 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, TT is valued a bit more expensive than the industry average as 73.17% of the companies are valued more cheaply.
TT's Price/Free Cash Flow ratio is a bit more expensive when compared to the industry. TT is more expensive than 60.98% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 36.74 | ||
| EV/EBITDA | 22.25 |
4.3 Compensation for Growth
TT's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
TT has an outstanding profitability rating, which may justify a higher PE ratio.
TT's earnings are expected to grow with 15.45% in the coming years. This may justify a more expensive valuation.
PEG (NY)1.66
PEG (5Y)2.73
EPS Next 2Y16.69%
EPS Next 3Y15.45%
5. Dividend
5.1 Amount
With a yearly dividend of 0.94%, TT is not a good candidate for dividend investing.
TT's Dividend Yield is a higher than the industry average which is at 1.41.
Compared to an average S&P500 Dividend Yield of 2.41, TT's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.94% |
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 its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)9.56%
Div Incr Years14
Div Non Decr Years14
5.3 Sustainability
27.90% of the earnings are spent on dividend by TT. This is a low number and sustainable payout ratio.
TT's earnings are growing around the same pace than its dividend. As long as the earnings growth is kept the dividend growth is sustainable.
DP27.9%
EPS Next 2Y16.69%
EPS Next 3Y15.45%
419.64
+0.82 (+0.2%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryBuilding Products
Earnings (Last)
Earnings (Next)
Inst Owners90.82%
Inst Owner Change-1.89%
Ins Owners0.26%
Ins Owner Change0.24%
Market Cap93.05B
Revenue(TTM)21.05B
Net Income(TTM)2.93B
Analysts71.18
Price Target491.58 (17.14%)
Short Float %1.4%
Short Ratio2.35
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.94% |
Yearly Dividend3.35
Dividend Growth(5Y)9.56%
DP27.9%
Div Incr Years14
Div Non Decr Years14
Ex-Date
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-0.51%
Min EPS beat(2)-0.67%
Max EPS beat(2)-0.35%
EPS beat(4)1
Avg EPS beat(4)1.55%
Min EPS beat(4)-0.67%
Max EPS beat(4)7.49%
EPS beat(8)4
Avg EPS beat(8)2.85%
EPS beat(12)8
Avg EPS beat(12)3.02%
EPS beat(16)11
Avg EPS beat(16)3.16%
Revenue beat(2)0
Avg Revenue beat(2)-3.52%
Min Revenue beat(2)-3.65%
Max Revenue beat(2)-3.39%
Revenue beat(4)1
Avg Revenue beat(4)-1.63%
Min Revenue beat(4)-3.65%
Max Revenue beat(4)1.64%
Revenue beat(8)3
Avg Revenue beat(8)-0.97%
Revenue beat(12)4
Avg Revenue beat(12)-0.99%
Revenue beat(16)6
Avg Revenue beat(16)-0.59%
PT rev (1m)5.21%
PT rev (3m)6.07%
EPS NQ rev (1m)-1.41%
EPS NQ rev (3m)-4.38%
EPS NY rev (1m)0.36%
EPS NY rev (3m)0.75%
Revenue NQ rev (1m)-2.29%
Revenue NQ rev (3m)-4.1%
Revenue NY rev (1m)-0.45%
Revenue NY rev (3m)-0.97%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 32.73 | ||
| Fwd PE | 27.47 | ||
| P/S | 4.42 | ||
| P/FCF | 36.74 | ||
| P/OCF | 31.7 | ||
| P/B | 11.18 | ||
| P/tB | N/A | ||
| EV/EBITDA | 22.25 |
EPS(TTM)12.82
EY3.05%
EPS(NY)15.28
Fwd EY3.64%
FCF(TTM)11.42
FCFY2.72%
OCF(TTM)13.24
OCFY3.15%
SpS94.94
BVpS37.55
TBVpS-6.27
PEG (NY)1.66
PEG (5Y)2.73
Graham Number104.07
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 13.72% | ||
| ROE | 35.21% | ||
| ROCE | 26.64% | ||
| ROIC | 21.47% | ||
| ROICexc | 23.24% | ||
| ROICexgc | 79.55% | ||
| OM | 18.79% | ||
| PM (TTM) | 13.93% | ||
| GM | 36.42% | ||
| FCFM | 12.03% |
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 Turnover0.98
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.47 | ||
| Debt/FCF | 1.82 | ||
| Debt/EBITDA | 0.9 | ||
| Cap/Depr | 105.39% | ||
| Cap/Sales | 1.91% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 67.67% | ||
| Profit Quality | 86.39% | ||
| Current Ratio | 1.2 | ||
| Quick Ratio | 0.84 | ||
| Altman-Z | 6.63 |
F-Score8
WACC7.34%
ROIC/WACC2.93
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)18.92%
EPS 3Y22.59%
EPS 5Y11.99%
EPS Q2Q%15.13%
EPS Next Y19.68%
EPS Next 2Y16.69%
EPS Next 3Y15.45%
EPS Next 5Y10.27%
Revenue 1Y (TTM)8.58%
Revenue growth 3Y11.96%
Revenue growth 5Y8.69%
Sales Q2Q%5.54%
Revenue Next Year8.23%
Revenue Next 2Y7.92%
Revenue Next 3Y7.78%
Revenue Next 5Y7.2%
EBIT growth 1Y17.03%
EBIT growth 3Y19.52%
EBIT growth 5Y15.23%
EBIT Next Year25.27%
EBIT Next 3Y14.95%
EBIT Next 5Y8.89%
FCF growth 1Y32.68%
FCF growth 3Y26.67%
FCF growth 5Y10.75%
OCF growth 1Y32.52%
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 32.73 and the Price/Book (PB) ratio is 11.18.
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 27.9%.