TRANE TECHNOLOGIES PLC (TT) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:TT - IE00BK9ZQ967 - Common Stock
393.74 USD
+3.88 (+1%)
393.74 USD
0 (0%)
TT gets a fundamental rating of 7 out of 10. The analysis compared the fundamentals against 42 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. While showing a medium growth rate, TT is valued expensive at the moment. With these ratings, TT could be worth investigating further for quality investing!.
1. Profitability
1.1 Basic Checks
In the past year TT was profitable.
In the past year TT had a positive cash flow from operations.
In the past 5 years TT has always been profitable.
Each year in the past 5 years TT had a positive operating cash flow.
1.2 Ratios
Looking at the Return On Assets, with a value of 13.72%, TT belongs to the top of the industry, outperforming 85.71% of the companies in the same industry.
TT has a Return On Equity of 35.21%. This is amongst the best in the industry. TT outperforms 92.86% of its industry peers.
TT has a better Return On Invested Capital (21.47%) 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 12.60%.
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
TT has a Profit Margin of 13.93%. This is in the better half of the industry: TT outperforms 71.43% of its industry peers.
In the last couple of years the Profit Margin of TT has grown nicely.
TT has a better Operating Margin (18.79%) than 73.81% of its industry peers.
In the last couple of years the Operating Margin of TT has grown nicely.
The Gross Margin of TT (36.42%) is better than 64.29% 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.
The number of shares outstanding for TT has been reduced compared to 5 years ago.
Compared to 1 year ago, TT has an improved debt to assets ratio.
2.2 Solvency
An Altman-Z score of 6.32 indicates that TT is not in any danger for bankruptcy at the moment.
With a decent Altman-Z score value of 6.32, TT is doing good in the industry, outperforming 76.19% of the companies in the same industry.
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.
TT has a Debt/Equity ratio of 0.47. This is a healthy value indicating a solid balance between debt and equity.
With a Debt to Equity ratio value of 0.47, TT perfoms like the industry average, outperforming 57.14% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.47 | ||
| Debt/FCF | 1.82 | ||
| Altman-Z | 6.32 |
ROIC/WACC2.92
WACC7.35%
2.3 Liquidity
TT has a Current Ratio of 1.20. This is a normal value and indicates that TT is financially healthy and should not expect problems in meeting its short term obligations.
TT has a Current ratio of 1.20. This is amonst the worse of the industry: TT underperforms 83.33% of its industry peers.
A Quick Ratio of 0.84 indicates that TT may have some problems paying its short term obligations.
TT has a worse Quick ratio (0.84) than 78.57% of its industry peers.
TT does not score too well on the current and quick ratio evaluation. However, as it has 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.
TT shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 11.99% yearly.
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.
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 Y19.57%
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.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 30.71 indicates a quite expensive valuation of TT.
66.67% 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 26.61, which is the current average of the S&P500 Index.
Based on the Price/Forward Earnings ratio of 25.74, the valuation of TT can be described as expensive.
TT's Price/Forward Earnings ratio is a bit more expensive when compared to the industry. TT is more expensive than 64.29% of the companies in the same industry.
TT's Price/Forward Earnings ratio indicates a similar valuation than the S&P500 average which is at 24.01.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 30.71 | ||
| Fwd PE | 25.74 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of TT indicates a slightly more expensive valuation: TT is more expensive than 71.43% of the companies listed in the same industry.
TT's Price/Free Cash Flow is on the same level as the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 34.47 | ||
| EV/EBITDA | 20.73 |
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.
A more expensive valuation may be justified as TT's earnings are expected to grow with 15.53% in the coming years.
PEG (NY)1.57
PEG (5Y)2.56
EPS Next 2Y16.76%
EPS Next 3Y15.53%
5. Dividend
5.1 Amount
With a yearly dividend of 0.98%, TT is not a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 0.71, TT pays a bit more dividend than its industry peers.
Compared to an average S&P500 Dividend Yield of 1.87, TT's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.98% |
5.2 History
On average, the dividend of TT grows each year by 9.56%, which is quite nice.
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.
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%
393.74
+3.88 (+1%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryBuilding Products
Earnings (Last)
Earnings (Next)
Inst Owners90.2%
Inst Owner Change-1.86%
Ins Owners0.25%
Ins Owner Change0.52%
Market Cap87.31B
Revenue(TTM)21.05B
Net Income(TTM)2.93B
Analysts72.73
Price Target489.7 (24.37%)
Short Float %1.33%
Short Ratio2.35
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.98% |
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)5.05%
PT rev (3m)4.3%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-3.55%
EPS NY rev (1m)-0.09%
EPS NY rev (3m)-0.16%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-3.67%
Revenue NY rev (1m)-0.45%
Revenue NY rev (3m)-1.44%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 30.71 | ||
| Fwd PE | 25.74 | ||
| P/S | 4.15 | ||
| P/FCF | 34.47 | ||
| P/OCF | 29.74 | ||
| P/B | 10.49 | ||
| P/tB | N/A | ||
| EV/EBITDA | 20.73 |
EPS(TTM)12.82
EY3.26%
EPS(NY)15.3
Fwd EY3.88%
FCF(TTM)11.42
FCFY2.9%
OCF(TTM)13.24
OCFY3.36%
SpS94.94
BVpS37.55
TBVpS-6.27
PEG (NY)1.57
PEG (5Y)2.56
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 | 6.32 |
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 3Y15.19%
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 30.71 and the Price/Book (PB) ratio is 10.49.
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%.