TRANE TECHNOLOGIES PLC (TT) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:TT - IE00BK9ZQ967 - Common Stock
385.47 USD
+3.77 (+0.99%)
385.47 USD
0 (0%)
Overall TT gets a fundamental rating of 7 out of 10. We evaluated TT against 42 industry peers in the Building Products industry. TT gets an excellent profitability rating and is at the same time showing great financial health properties. TT is quite expensive at the moment. It does show a decent growth rate. These ratings would make TT suitable for quality investing!
1. Profitability
1.1 Basic Checks
In the past year TT was profitable.
TT had a positive operating cash flow in the past year.
In the past 5 years TT has always been profitable.
In the past 5 years TT always reported a positive cash flow from operatings.
1.2 Ratios
TT has a Return On Assets of 13.72%. This is amongst the best in the industry. TT outperforms 85.71% of its industry peers.
With an excellent Return On Equity value of 35.21%, TT belongs to the best of the industry, outperforming 92.86% of the companies in the same industry.
The Return On Invested Capital of TT (21.47%) is better than 90.48% 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 12.63%.
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 71.43% of the companies in the same industry.
TT's Profit Margin has improved in the last couple of years.
TT's Operating Margin of 18.79% is fine compared to the rest of the industry. TT outperforms 73.81% of its industry peers.
TT's Operating Margin has improved in the last couple of years.
TT has a Gross Margin of 36.42%. This is in the better half of the industry: TT outperforms 64.29% of its industry peers.
TT's Gross Margin has improved in the last couple of years.
| 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
With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), 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 6.24 indicates that TT is not in any danger for bankruptcy at the moment.
TT has a Altman-Z score of 6.24. This is in the better half of the industry: TT outperforms 76.19% of its industry peers.
TT has a debt to FCF ratio of 1.82. This is a very positive value and a sign of high solvency as it would only need 1.82 years to pay back of all of its debts.
With a decent Debt to FCF ratio value of 1.82, TT is doing good in the industry, outperforming 76.19% of the companies in the same industry.
A Debt/Equity ratio of 0.47 indicates that TT is not too dependend on debt financing.
TT has a Debt to Equity ratio of 0.47. This is comparable to the rest of the industry: TT outperforms 54.76% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.47 | ||
| Debt/FCF | 1.82 | ||
| Altman-Z | 6.24 |
ROIC/WACC2.92
WACC7.35%
2.3 Liquidity
A Current Ratio of 1.20 indicates that TT should not have too much problems paying its short term obligations.
The Current ratio of TT (1.20) is worse than 85.71% of its industry peers.
A Quick Ratio of 0.84 indicates that TT may have some problems paying its short term obligations.
Looking at the Quick ratio, with a value of 0.84, TT is doing worse than 80.95% of the companies in the same industry.
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.
The Earnings Per Share has been growing by 11.99% on average over the past years. This is quite good.
TT shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 8.58%.
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
Based on estimates for the next years, TT will show a quite strong growth in Earnings Per Share. The EPS will grow by 10.27% on average per year.
The Revenue is expected to grow by 7.20% on average over the next years.
EPS Next Y19.57%
EPS Next 2Y16.76%
EPS Next 3Y15.53%
EPS Next 5Y10.27%
Revenue Next Year7.75%
Revenue Next 2Y7.71%
Revenue Next 3Y7.66%
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 30.07.
69.05% of the companies in the same industry are cheaper than TT, based on the Price/Earnings ratio.
TT is valuated at similar levels of the S&P average when we compare the Price/Earnings ratio to 27.25, which is the current average of the S&P500 Index.
TT is valuated quite expensively with a Price/Forward Earnings ratio of 25.20.
Based on the Price/Forward Earnings ratio, TT is valued a bit more expensive than the industry average as 66.67% of the companies are valued more cheaply.
TT's Price/Forward Earnings ratio indicates a similar valuation than the S&P500 average which is at 23.98.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 30.07 | ||
| Fwd PE | 25.2 |
4.2 Price Multiples
TT's Enterprise Value to EBITDA ratio is a bit more expensive when compared to the industry. TT is more expensive than 69.05% of the companies in the same industry.
The rest of the industry has a similar Price/Free Cash Flow ratio as TT.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 33.75 | ||
| EV/EBITDA | 20.31 |
4.3 Compensation for Growth
TT's 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 15.53% in the coming years.
PEG (NY)1.54
PEG (5Y)2.51
EPS Next 2Y16.76%
EPS Next 3Y15.53%
5. Dividend
5.1 Amount
With a yearly dividend of 0.99%, TT is not a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 0.70, TT pays a bit more dividend than its industry peers.
Compared to an average S&P500 Dividend Yield of 1.92, TT's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.99% |
5.2 History
On average, the dividend of TT grows each year by 9.56%, which is quite nice.
TT has been paying a dividend for at least 10 years, so it has 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
TT pays out 27.90% 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.
DP27.9%
EPS Next 2Y16.76%
EPS Next 3Y15.53%
385.47
+3.77 (+0.99%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryBuilding Products
Earnings (Last)
Earnings (Next)
Inst Owners90.31%
Inst Owner Change0.1%
Ins Owners0.25%
Ins Owner Change0.52%
Market Cap85.47B
Revenue(TTM)21.05B
Net Income(TTM)2.93B
Analysts73.33
Price Target489.7 (27.04%)
Short Float %1.36%
Short Ratio2.36
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.99% |
Yearly Dividend3.35
Dividend Growth(5Y)9.56%
DP27.9%
Div Incr Years14
Div Non Decr Years14
Ex-DateN/A
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)-0.51%
PT rev (3m)4.8%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-2.51%
EPS NY rev (1m)0.01%
EPS NY rev (3m)-0.16%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-3%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-1.13%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 30.07 | ||
| Fwd PE | 25.2 | ||
| P/S | 4.06 | ||
| P/FCF | 33.75 | ||
| P/OCF | 29.12 | ||
| P/B | 10.27 | ||
| P/tB | N/A | ||
| EV/EBITDA | 20.31 |
EPS(TTM)12.82
EY3.33%
EPS(NY)15.3
Fwd EY3.97%
FCF(TTM)11.42
FCFY2.96%
OCF(TTM)13.24
OCFY3.43%
SpS94.94
BVpS37.55
TBVpS-6.27
PEG (NY)1.54
PEG (5Y)2.51
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 | 6.24 |
F-Score8
WACC7.35%
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)18.92%
EPS 3Y22.59%
EPS 5Y11.99%
EPS Q2Q%15.13%
EPS Next Y19.57%
EPS Next 2Y16.76%
EPS Next 3Y15.53%
EPS Next 5Y10.27%
Revenue 1Y (TTM)8.58%
Revenue growth 3Y11.96%
Revenue growth 5Y8.69%
Sales Q2Q%5.54%
Revenue Next Year7.75%
Revenue Next 2Y7.71%
Revenue Next 3Y7.66%
Revenue Next 5Y7.2%
EBIT growth 1Y17.03%
EBIT growth 3Y19.52%
EBIT growth 5Y15.23%
EBIT Next Year24.93%
EBIT Next 3Y15.16%
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.
Can you provide the valuation status for TRANE TECHNOLOGIES PLC?
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.
Can you provide the financial health for TT stock?
The financial health rating of TRANE TECHNOLOGIES PLC (TT) is 7 / 10.
What is the expected EPS growth for TRANE TECHNOLOGIES PLC (TT) stock?
The Earnings per Share (EPS) of TRANE TECHNOLOGIES PLC (TT) is expected to grow by 19.57% in the next year.