RB Global Inc (NYSE:RBA) Identified by Caviar Cruise Quality Investing Screen

RB Global Inc (NYSE:RBA) has been identified by the Caviar Cruise stock screening strategy, a systematic process for finding good companies for long-term investment. This method, based on quality investing ideas, focuses on lasting business models, solid financial condition, and steady growth, traits that let investors keep positions for long times, frequently ignoring short-term market changes. The screen looks at numbers including sales growth, profit levels, return on capital put to work, debt control, and cash flow strength to find strong, well-run companies with market edges.

Performance and Growth Metrics

RB Global shows solid past results, an important point for quality investors looking for companies with a history of success. Over the last five years, the company has reached:

• Sales growth (5Y CAGR) of 8.39%, above the screen’s 5% minimum
• EBIT growth (5Y CAGR) of 29.02%, much higher than sales growth
• This difference points to better operational performance and possible strength in pricing

The company’s skill in growing earnings quicker than sales matches a main idea of quality investing: businesses that show rising profit levels are frequently growing well or gaining from lasting market edges. These features lower the need for outside money and improve long-term staying power.

Profitability and Capital Efficiency

A notable number for RB Global is its return on invested capital without cash, goodwill, and intangibles (ROICexgc), which is 19.52%. This is higher than the screen’s 15% minimum and shows good capital use, a sign of quality companies. High ROIC shows management’s skill in creating profits from capital put to work, a key part for building shareholder value over time. Also, the company keeps a good average profit strength of 143.60% over five years, well above the 75% mark. This shows that RB Global turns a large part of its net income into free cash flow, highlighting financial soundness and lowering reliance on accounting changes.

Financial Health and Debt Management

Quality investing focuses on financial steadiness, and RB Global’s debt-to-free cash flow number of 4.46 is inside the screen’s acceptable area of under 5. This suggests the company might pay off its debt in five years using present cash flow levels, showing a workable debt position and less financial danger. Such a position helps operational freedom and toughness in economic drops, matching the quality investor’s focus on lasting power.

Fundamental Analysis Overview

As per Chartmill’s fundamental report, RB Global has an overall score of 5 out of 10, placing it as a middle performer compared to industry others in commercial services and supplies. The report points to mixed outcomes: strong profit margins and growth chances are balanced by valuation questions and average financial condition. Importantly, the company does well in operating margin (better than 88.10% of others) and shows good past and expected growth, though its price-to-earnings number implies a higher valuation. The analysis also mentions a steady dividend history with an 11.54% yearly growth rate, though lasting power questions come from a high payout ratio.

Suitability for Quality Investing

RB Global fits a number of Caviar Cruise needs that quality investors focus on: steady growth, high returns on capital, good cash flow creation, and sensible debt amounts. Its global presence in commercial asset markets, covering automotive, construction, energy, and government areas, implies variety and possible toughness to local economic changes. The company’s full services, including auction operations, asset handling, and digital tools, point to a market position and fit with long-term industrial and digital trends.

Still, investors should know the screen does not look at valuation, and RB Global trades at higher multiples. Quality investors usually agree to higher valuations for outstanding businesses, but more research, checking management quality, industry place, and possible challenges, is needed.

Explore More Quality Candidates

For readers wanting to see other companies that meet the Caviar Cruise needs, more screening results are available here.

Disclaimer: This article is for informational purposes only and does not constitute investment advice or a recommendation to buy, sell, or hold any security. Investors should conduct their own research and consult with a qualified financial advisor before making investment decisions.