TORO CO (TTC) Stock Fundamental Analysis
NYSE:TTC - New York Stock Exchange, Inc. - US8910921084 - Common Stock - Currency: USD
TTC gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 128 industry peers in the Machinery industry. While TTC belongs to the best of the industry regarding profitability, there are some minor concerns on its financial health. TTC has a valuation in line with the averages, but on the other hand it scores bad on growth. Finally TTC also has an excellent dividend rating. This makes TTC very considerable for dividend investing!
1. Profitability
1.1 Basic Checks
TTC had positive earnings in the past year.
In the past year TTC had a positive cash flow from operations.
TTC had positive earnings in each of the past 5 years.
In the past 5 years TTC always reported a positive cash flow from operatings.
1.2 Ratios
TTC has a Return On Assets of 11.00%. This is amongst the best in the industry. TTC outperforms 82.03% of its industry peers.
The Return On Equity of TTC (27.72%) is better than 92.19% of its industry peers.
With an excellent Return On Invested Capital value of 15.85%, TTC belongs to the best of the industry, outperforming 88.28% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for TTC is significantly above the industry average of 10.67%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 11% | ||
| ROE | 27.72% | ||
| ROIC | 15.85% |
ROA(3y)11.07%
ROA(5y)11.74%
ROE(3y)27.2%
ROE(5y)29.36%
ROIC(3y)17.81%
ROIC(5y)18.34%
1.3 Margins
TTC's Profit Margin of 8.89% is fine compared to the rest of the industry. TTC outperforms 66.41% of its industry peers.
TTC's Profit Margin has been stable in the last couple of years.
TTC's Operating Margin of 11.42% is fine compared to the rest of the industry. TTC outperforms 60.16% of its industry peers.
In the last couple of years the Operating Margin of TTC has grown nicely.
The Gross Margin of TTC (33.66%) is comparable to the rest of the industry.
TTC's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 11.42% | ||
| PM (TTM) | 8.89% | ||
| GM | 33.66% |
OM growth 3Y-3.14%
OM growth 5Y2.35%
PM growth 3Y-4.07%
PM growth 5Y0.92%
GM growth 3Y0%
GM growth 5Y0.24%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so TTC is still creating some value.
TTC has less shares outstanding than it did 1 year ago.
TTC has less shares outstanding than it did 5 years ago.
TTC has a better debt/assets ratio than last year.
2.2 Solvency
An Altman-Z score of 4.34 indicates that TTC is not in any danger for bankruptcy at the moment.
With a decent Altman-Z score value of 4.34, TTC is doing good in the industry, outperforming 71.88% of the companies in the same industry.
TTC has a debt to FCF ratio of 2.17. This is a good value and a sign of high solvency as TTC would need 2.17 years to pay back of all of its debts.
The Debt to FCF ratio of TTC (2.17) is better than 77.34% of its industry peers.
A Debt/Equity ratio of 0.74 indicates that TTC is somewhat dependend on debt financing.
TTC's Debt to Equity ratio of 0.74 is on the low side compared to the rest of the industry. TTC is outperformed by 69.53% of its industry peers.
Although TTC does not score too well on debt/equity it has very limited outstanding debt, which is well covered by the FCF. We will not put too much weight on the debt/equity number as it may be because of low equity, which could be a consequence of a share buyback program for instance. This needs to be investigated.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.74 | ||
| Debt/FCF | 2.17 | ||
| Altman-Z | 4.34 |
ROIC/WACC1.56
WACC10.18%
2.3 Liquidity
A Current Ratio of 1.91 indicates that TTC should not have too much problems paying its short term obligations.
With a Current ratio value of 1.91, TTC perfoms like the industry average, outperforming 41.41% of the companies in the same industry.
A Quick Ratio of 0.76 indicates that TTC may have some problems paying its short term obligations.
TTC has a worse Quick ratio (0.76) than 79.69% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.91 | ||
| Quick Ratio | 0.76 |
3. Growth
3.1 Past
TTC shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 7.73%.
TTC shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 6.88% yearly.
Looking at the last year, TTC shows a small growth in Revenue. The Revenue has grown by 3.87% in the last year.
TTC shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 7.87% yearly.
EPS 1Y (TTM)7.73%
EPS 3Y4.83%
EPS 5Y6.88%
EPS Q2Q%1.56%
Revenue 1Y (TTM)3.87%
Revenue growth 3Y5%
Revenue growth 5Y7.87%
Sales Q2Q%-0.69%
3.2 Future
TTC is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 4.15% yearly.
The Revenue is expected to grow by 1.57% on average over the next years.
EPS Next Y4.15%
EPS Next 2Y6.61%
EPS Next 3Y7.24%
EPS Next 5Y4.15%
Revenue Next Year0.28%
Revenue Next 2Y1.57%
Revenue Next 3Y2.04%
Revenue Next 5Y1.57%
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 decreasing.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 16.06, TTC is valued correctly.
Compared to the rest of the industry, the Price/Earnings ratio of TTC indicates a somewhat cheap valuation: TTC is cheaper than 66.41% of the companies listed in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 28.29, TTC is valued a bit cheaper.
Based on the Price/Forward Earnings ratio of 14.17, the valuation of TTC can be described as correct.
TTC's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. TTC is cheaper than 73.44% of the companies in the same industry.
TTC is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 21.08, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 16.06 | ||
| Fwd PE | 14.17 |
4.2 Price Multiples
TTC's Enterprise Value to EBITDA ratio is in line with the industry average.
TTC's Price/Free Cash Flow ratio is rather cheap when compared to the industry. TTC is cheaper than 80.47% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 13.16 | ||
| EV/EBITDA | 11.71 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates TTC does not grow enough to justify the current Price/Earnings ratio.
TTC has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)3.87
PEG (5Y)2.33
EPS Next 2Y6.61%
EPS Next 3Y7.24%
5. Dividend
5.1 Amount
TTC has a Yearly Dividend Yield of 2.28%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 2.12, TTC pays a better dividend. On top of this TTC pays more dividend than 84.38% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 2.57, TTC has a dividend comparable with the average S&P500 company.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.28% |
5.2 History
The dividend of TTC is nicely growing with an annual growth rate of 9.97%!
TTC has been paying a dividend for at least 10 years, so it has a reliable track record.
TTC has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)9.97%
Div Incr Years20
Div Non Decr Years33
5.3 Sustainability
36.97% of the earnings are spent on dividend by TTC. This is a low number and sustainable payout ratio.
The dividend of TTC is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP36.97%
EPS Next 2Y6.61%
EPS Next 3Y7.24%
67.14
+0.64 (+0.96%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryMachinery
Earnings (Last)
Earnings (Next)
Inst Owners94.49%
Inst Owner Change0%
Ins Owners0.35%
Ins Owner Change1.16%
Market Cap6.70B
Analysts72.73
Price Target93.33 (39.01%)
Short Float %4.66%
Short Ratio4.23
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.28% |
Yearly Dividend1.46
Dividend Growth(5Y)9.97%
DP36.97%
Div Incr Years20
Div Non Decr Years33
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)0.25%
Min EPS beat(2)-1.66%
Max EPS beat(2)2.15%
EPS beat(4)2
Avg EPS beat(4)0.91%
Min EPS beat(4)-4.45%
Max EPS beat(4)7.59%
EPS beat(8)4
Avg EPS beat(8)0.63%
EPS beat(12)7
Avg EPS beat(12)1.16%
EPS beat(16)11
Avg EPS beat(16)2.98%
Revenue beat(2)0
Avg Revenue beat(2)-2.12%
Min Revenue beat(2)-2.27%
Max Revenue beat(2)-1.97%
Revenue beat(4)0
Avg Revenue beat(4)-3.47%
Min Revenue beat(4)-9.05%
Max Revenue beat(4)-0.59%
Revenue beat(8)0
Avg Revenue beat(8)-4.42%
Revenue beat(12)0
Avg Revenue beat(12)-3.63%
Revenue beat(16)2
Avg Revenue beat(16)-2.91%
PT rev (1m)-1.96%
PT rev (3m)-2.31%
EPS NQ rev (1m)-0.36%
EPS NQ rev (3m)-8.54%
EPS NY rev (1m)-0.3%
EPS NY rev (3m)-6.14%
Revenue NQ rev (1m)0.07%
Revenue NQ rev (3m)-2.57%
Revenue NY rev (1m)0%
Revenue NY rev (3m)0.02%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 16.06 | ||
| Fwd PE | 14.17 | ||
| P/S | 1.46 | ||
| P/FCF | 13.16 | ||
| P/OCF | 10.92 | ||
| P/B | 4.57 | ||
| P/tB | 12.71 | ||
| EV/EBITDA | 11.71 |
EPS(TTM)4.18
EY6.23%
EPS(NY)4.74
Fwd EY7.06%
FCF(TTM)5.1
FCFY7.6%
OCF(TTM)6.15
OCFY9.15%
SpS45.85
BVpS14.7
TBVpS5.28
PEG (NY)3.87
PEG (5Y)2.33
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 11% | ||
| ROE | 27.72% | ||
| ROCE | 19.33% | ||
| ROIC | 15.85% | ||
| ROICexc | 16.92% | ||
| ROICexgc | 26.92% | ||
| OM | 11.42% | ||
| PM (TTM) | 8.89% | ||
| GM | 33.66% | ||
| FCFM | 11.13% |
ROA(3y)11.07%
ROA(5y)11.74%
ROE(3y)27.2%
ROE(5y)29.36%
ROIC(3y)17.81%
ROIC(5y)18.34%
ROICexc(3y)19.24%
ROICexc(5y)21.37%
ROICexgc(3y)34.38%
ROICexgc(5y)41.9%
ROCE(3y)21.71%
ROCE(5y)22.37%
ROICexcg growth 3Y-18.45%
ROICexcg growth 5Y-4.48%
ROICexc growth 3Y-11.36%
ROICexc growth 5Y-0.63%
OM growth 3Y-3.14%
OM growth 5Y2.35%
PM growth 3Y-4.07%
PM growth 5Y0.92%
GM growth 3Y0%
GM growth 5Y0.24%
F-Score7
Asset Turnover1.24
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.74 | ||
| Debt/FCF | 2.17 | ||
| Debt/EBITDA | 1.67 | ||
| Cap/Depr | 80.48% | ||
| Cap/Sales | 2.28% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 94.08% | ||
| Profit Quality | 125.17% | ||
| Current Ratio | 1.91 | ||
| Quick Ratio | 0.76 | ||
| Altman-Z | 4.34 |
F-Score7
WACC10.18%
ROIC/WACC1.56
Cap/Depr(3y)115.09%
Cap/Depr(5y)111.81%
Cap/Sales(3y)2.97%
Cap/Sales(5y)2.9%
Profit Quality(3y)63.97%
Profit Quality(5y)87.06%
High Growth Momentum
Growth
EPS 1Y (TTM)7.73%
EPS 3Y4.83%
EPS 5Y6.88%
EPS Q2Q%1.56%
EPS Next Y4.15%
EPS Next 2Y6.61%
EPS Next 3Y7.24%
EPS Next 5Y4.15%
Revenue 1Y (TTM)3.87%
Revenue growth 3Y5%
Revenue growth 5Y7.87%
Sales Q2Q%-0.69%
Revenue Next Year0.28%
Revenue Next 2Y1.57%
Revenue Next 3Y2.04%
Revenue Next 5Y1.57%
EBIT growth 1Y-2.19%
EBIT growth 3Y1.7%
EBIT growth 5Y10.41%
EBIT Next Year27.79%
EBIT Next 3Y13.9%
EBIT Next 5YN/A
FCF growth 1Y238.93%
FCF growth 3Y3.15%
FCF growth 5Y13.75%
OCF growth 1Y92.7%
OCF growth 3Y0.86%
OCF growth 5Y11.05%