Balancing Dividends and Fundamentals: The Case of NYSE:TKR.

Take a closer look at TIMKEN CO (NYSE:TKR), a stock of interest to dividend investors uncovered by our stock screener. NYSE:TKR excels in fundamentals and provides a decent dividend, all while maintaining a reasonable valuation. Let's break it down further.

Dividend Insights: NYSE:TKR

ChartMill assigns a Dividend Rating to each stock, ranging from 0 to 10. This rating is calculated by analyzing various dividend elements, such as yield, historical performance, dividend growth, and sustainability. NYSE:TKR has been awarded a 7 for its dividend quality:

• Compared to an average industry Dividend Yield of 2.01, TKR pays a better dividend. On top of this TKR pays more dividend than 80.77% of the companies listed in the same industry.
• TKR has been paying a dividend for at least 10 years, so it has a reliable track record.
• TKR has not decreased their dividend for at least 10 years, which is a reliable track record.
• 21.47% of the earnings are spent on dividend by TKR. This is a low number and sustainable payout ratio.
• TKR's earnings are growing more than its dividend. This makes the dividend growth sustainable.

Health Examination for NYSE:TKR

ChartMill employs a unique Health Rating system for all stocks. This rating, ranging from 0 to 10, is determined by analyzing various liquidity and solvency ratios. For NYSE:TKR, the assigned 5 for health provides valuable insights:

• TKR has a Debt to FCF ratio of 5.06. This is in the better half of the industry: TKR outperforms 66.15% of its industry peers.
• TKR has a Current Ratio of 2.65. This indicates that TKR is financially healthy and has no problem in meeting its short term obligations.
• The Current ratio of TKR (2.65) is better than 65.38% of its industry peers.
• Looking at the Quick ratio, with a value of 1.43, TKR is in the better half of the industry, outperforming 66.15% of the companies in the same industry.

Assessing Profitability for NYSE:TKR

ChartMill assigns a proprietary Profitability Rating to each stock. The score is computed by evaluating various profitability ratios and margins and ranges from 0 to 10. NYSE:TKR was assigned a score of 7 for profitability:

• TKR has a Return On Assets of 6.91%. This is in the better half of the industry: TKR outperforms 71.54% of its industry peers.
• The Return On Equity of TKR (17.05%) is better than 77.69% of its industry peers.
• TKR's Return On Invested Capital of 10.50% is fine compared to the rest of the industry. TKR outperforms 73.85% of its industry peers.
• The last Return On Invested Capital (10.50%) for TKR is above the 3 year average (9.52%), which is a sign of increasing profitability.
• TKR has a Profit Margin of 9.08%. This is in the better half of the industry: TKR outperforms 73.08% of its industry peers.
• In the last couple of years the Profit Margin of TKR has grown nicely.
• Looking at the Operating Margin, with a value of 14.97%, TKR is in the better half of the industry, outperforming 78.46% of the companies in the same industry.
• TKR's Operating Margin has improved in the last couple of years.

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Our latest full fundamental report of TKR contains the most current fundamental analsysis.

Disclaimer

This is not investing advice! The article highlights some of the observations at the time of writing, but you should always make your own analysis and invest based on your own insights.