CNH INDUSTRIAL NV (CNH) Stock Fundamental Analysis
NYSE:CNH - New York Stock Exchange, Inc. - NL0010545661 - Common Stock - Currency: USD
We assign a fundamental rating of 4 out of 10 to CNH. CNH was compared to 129 industry peers in the Machinery industry. There are concerns on the financial health of CNH while its profitability can be described as average. CNH is valued correctly, but it does not seem to be growing.
1. Profitability
1.1 Basic Checks
CNH had positive earnings in the past year.
CNH had a positive operating cash flow in the past year.
CNH had positive earnings in 4 of the past 5 years.
Each year in the past 5 years CNH had a positive operating cash flow.
1.2 Ratios
Looking at the Return On Assets, with a value of 2.90%, CNH is in line with its industry, outperforming 44.19% of the companies in the same industry.
With a decent Return On Equity value of 16.29%, CNH is doing good in the industry, outperforming 74.42% of the companies in the same industry.
The Return On Invested Capital of CNH (8.19%) is comparable to the rest of the industry.
CNH had an Average Return On Invested Capital over the past 3 years of 11.39%. This is in line with the industry average of 10.67%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.9% | ||
| ROE | 16.29% | ||
| ROIC | 8.19% |
ROA(3y)4.39%
ROA(5y)3.13%
ROE(3y)25.03%
ROE(5y)18.1%
ROIC(3y)11.39%
ROIC(5y)8.98%
1.3 Margins
CNH's Profit Margin of 6.28% is in line compared to the rest of the industry. CNH outperforms 55.81% of its industry peers.
In the last couple of years the Profit Margin of CNH has grown nicely.
Looking at the Operating Margin, with a value of 19.41%, CNH belongs to the top of the industry, outperforming 86.82% of the companies in the same industry.
CNH's Operating Margin has improved in the last couple of years.
Looking at the Gross Margin, with a value of 32.70%, CNH is in line with its industry, outperforming 56.59% of the companies in the same industry.
CNH's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 19.41% | ||
| PM (TTM) | 6.28% | ||
| GM | 32.7% |
OM growth 3Y4.76%
OM growth 5Y12.67%
PM growth 3Y-10.76%
PM growth 5Y4.4%
GM growth 3Y5.77%
GM growth 5Y8.01%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so CNH is still creating some value.
CNH has less shares outstanding than it did 1 year ago.
Compared to 5 years ago, CNH has less shares outstanding
The debt/assets ratio for CNH is higher compared to a year ago.
2.2 Solvency
Based on the Altman-Z score of 1.41, we must say that CNH is in the distress zone and has some risk of bankruptcy.
CNH's Altman-Z score of 1.41 is on the low side compared to the rest of the industry. CNH is outperformed by 72.87% of its industry peers.
CNH has a debt to FCF ratio of 34.38. This is a negative value and a sign of low solvency as CNH would need 34.38 years to pay back of all of its debts.
CNH's Debt to FCF ratio of 34.38 is on the low side compared to the rest of the industry. CNH is outperformed by 67.44% of its industry peers.
CNH has a Debt/Equity ratio of 3.51. This is a high value indicating a heavy dependency on external financing.
CNH has a Debt to Equity ratio of 3.51. This is amonst the worse of the industry: CNH underperforms 89.15% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 3.51 | ||
| Debt/FCF | 34.38 | ||
| Altman-Z | 1.41 |
ROIC/WACC1.06
WACC7.72%
2.3 Liquidity
A Current Ratio of 1.27 indicates that CNH should not have too much problems paying its short term obligations.
The Current ratio of CNH (1.27) is worse than 85.27% of its industry peers.
A Quick Ratio of 0.54 indicates that CNH may have some problems paying its short term obligations.
The Quick ratio of CNH (0.54) is worse than 90.70% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.27 | ||
| Quick Ratio | 0.54 |
3. Growth
3.1 Past
The earnings per share for CNH have decreased strongly by -48.52% in the last year.
Measured over the past 5 years, CNH shows a small growth in Earnings Per Share. The EPS has been growing by 5.29% on average per year.
CNH shows a very negative growth in Revenue. In the last year, the Revenue has decreased by -19.65%.
The Revenue has been decreasing by -6.71% on average over the past years.
EPS 1Y (TTM)-48.52%
EPS 3Y-6.6%
EPS 5Y5.29%
EPS Q2Q%-69.7%
Revenue 1Y (TTM)-19.65%
Revenue growth 3Y0.58%
Revenue growth 5Y-6.71%
Sales Q2Q%-20.55%
3.2 Future
Based on estimates for the next years, CNH will show a decrease in Earnings Per Share. The EPS will decrease by -2.49% on average per year.
The Revenue is expected to decrease by -0.15% on average over the next years.
EPS Next Y-37.05%
EPS Next 2Y-6.73%
EPS Next 3Y2.44%
EPS Next 5Y-2.49%
Revenue Next Year-14.57%
Revenue Next 2Y-4.24%
Revenue Next 3Y-1.26%
Revenue Next 5Y-0.15%
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 14.25, which indicates a correct valuation of CNH.
Compared to the rest of the industry, the Price/Earnings ratio of CNH indicates a somewhat cheap valuation: CNH is cheaper than 77.52% of the companies listed in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 28.22, CNH is valued a bit cheaper.
Based on the Price/Forward Earnings ratio of 12.96, the valuation of CNH can be described as correct.
Based on the Price/Forward Earnings ratio, CNH is valued a bit cheaper than the industry average as 79.07% of the companies are valued more expensively.
CNH's Price/Forward Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 20.86.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 14.25 | ||
| Fwd PE | 12.96 |
4.2 Price Multiples
CNH's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. CNH is cheaper than 79.07% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, CNH is valued a bit cheaper than 64.34% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 19.79 | ||
| EV/EBITDA | 8.79 |
4.3 Compensation for Growth
The decent profitability rating of CNH may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)2.69
EPS Next 2Y-6.73%
EPS Next 3Y2.44%
5. Dividend
5.1 Amount
CNH has a Yearly Dividend Yield of 2.01%.
Compared to an average industry Dividend Yield of 2.05, CNH pays a better dividend. On top of this CNH pays more dividend than 81.40% of the companies listed in the same industry.
CNH's Dividend Yield is comparable with the S&P500 average which is at 2.44.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.01% |
5.2 History
On average, the dividend of CNH grows each year by 17.96%, which is quite nice.
CNH has been paying a dividend for over 5 years, so it has already some track record.
CNH has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)17.96%
Div Incr Years3
Div Non Decr Years3
5.3 Sustainability
48.72% of the earnings are spent on dividend by CNH. This is a bit on the high side, but may be sustainable.
DP48.72%
EPS Next 2Y-6.73%
EPS Next 3Y2.44%
12.4
-0.01 (-0.08%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryMachinery
Earnings (Last)
Earnings (Next)
Inst Owners73.24%
Inst Owner Change0%
Ins Owners0.2%
Ins Owner Change16.38%
Market Cap15.48B
Analysts75.45
Price Target14.46 (16.61%)
Short Float %7.24%
Short Ratio3.17
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.01% |
Yearly Dividend0.48
Dividend Growth(5Y)17.96%
DP48.72%
Div Incr Years3
Div Non Decr Years3
Ex-Date
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-13.7%
Min EPS beat(2)-15.2%
Max EPS beat(2)-12.21%
EPS beat(4)2
Avg EPS beat(4)-0.95%
Min EPS beat(4)-15.2%
Max EPS beat(4)22.3%
EPS beat(8)4
Avg EPS beat(8)0.86%
EPS beat(12)7
Avg EPS beat(12)4.85%
EPS beat(16)11
Avg EPS beat(16)19.1%
Revenue beat(2)2
Avg Revenue beat(2)3.75%
Min Revenue beat(2)0.52%
Max Revenue beat(2)6.98%
Revenue beat(4)4
Avg Revenue beat(4)5.05%
Min Revenue beat(4)0.52%
Max Revenue beat(4)10.48%
Revenue beat(8)8
Avg Revenue beat(8)3.1%
Revenue beat(12)11
Avg Revenue beat(12)4.86%
Revenue beat(16)12
Avg Revenue beat(16)-2.16%
PT rev (1m)-4.47%
PT rev (3m)-0.26%
EPS NQ rev (1m)-9.95%
EPS NQ rev (3m)-35.96%
EPS NY rev (1m)-3.2%
EPS NY rev (3m)-21.46%
Revenue NQ rev (1m)-0.11%
Revenue NQ rev (3m)-2.58%
Revenue NY rev (1m)-1.09%
Revenue NY rev (3m)-5.16%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 14.25 | ||
| Fwd PE | 12.96 | ||
| P/S | 0.78 | ||
| P/FCF | 19.79 | ||
| P/OCF | 7.86 | ||
| P/B | 2.02 | ||
| P/tB | 5.44 | ||
| EV/EBITDA | 8.79 |
EPS(TTM)0.87
EY7.02%
EPS(NY)0.96
Fwd EY7.72%
FCF(TTM)0.63
FCFY5.05%
OCF(TTM)1.58
OCFY12.72%
SpS15.89
BVpS6.13
TBVpS2.28
PEG (NY)N/A
PEG (5Y)2.69
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.9% | ||
| ROE | 16.29% | ||
| ROCE | 10.57% | ||
| ROIC | 8.19% | ||
| ROICexc | 8.97% | ||
| ROICexgc | 10.88% | ||
| OM | 19.41% | ||
| PM (TTM) | 6.28% | ||
| GM | 32.7% | ||
| FCFM | 3.94% |
ROA(3y)4.39%
ROA(5y)3.13%
ROE(3y)25.03%
ROE(5y)18.1%
ROIC(3y)11.39%
ROIC(5y)8.98%
ROICexc(3y)14.51%
ROICexc(5y)12.46%
ROICexgc(3y)20.25%
ROICexgc(5y)19.15%
ROCE(3y)14.71%
ROCE(5y)11.59%
ROICexcg growth 3Y0.53%
ROICexcg growth 5Y3.13%
ROICexc growth 3Y21.35%
ROICexc growth 5Y3.15%
OM growth 3Y4.76%
OM growth 5Y12.67%
PM growth 3Y-10.76%
PM growth 5Y4.4%
GM growth 3Y5.77%
GM growth 5Y8.01%
F-Score5
Asset Turnover0.46
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 3.51 | ||
| Debt/FCF | 34.38 | ||
| Debt/EBITDA | 6.03 | ||
| Cap/Depr | 196.03% | ||
| Cap/Sales | 5.98% | ||
| Interest Coverage | 2.41 | ||
| Cash Conversion | 44.18% | ||
| Profit Quality | 62.76% | ||
| Current Ratio | 1.27 | ||
| Quick Ratio | 0.54 | ||
| Altman-Z | 1.41 |
F-Score5
WACC7.72%
ROIC/WACC1.06
Cap/Depr(3y)198.21%
Cap/Depr(5y)185.92%
Cap/Sales(3y)5.02%
Cap/Sales(5y)7.6%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-48.52%
EPS 3Y-6.6%
EPS 5Y5.29%
EPS Q2Q%-69.7%
EPS Next Y-37.05%
EPS Next 2Y-6.73%
EPS Next 3Y2.44%
EPS Next 5Y-2.49%
Revenue 1Y (TTM)-19.65%
Revenue growth 3Y0.58%
Revenue growth 5Y-6.71%
Sales Q2Q%-20.55%
Revenue Next Year-14.57%
Revenue Next 2Y-4.24%
Revenue Next 3Y-1.26%
Revenue Next 5Y-0.15%
EBIT growth 1Y-22.14%
EBIT growth 3Y5.37%
EBIT growth 5Y5.11%
EBIT Next Year-8.37%
EBIT Next 3Y11.62%
EBIT Next 5Y20.58%
FCF growth 1Y371.53%
FCF growth 3Y-27.46%
FCF growth 5YN/A
OCF growth 1Y116.98%
OCF growth 3Y-21.59%
OCF growth 5Y1.51%