DONALDSON CO INC (DCI) Stock Fundamental Analysis
NYSE:DCI - New York Stock Exchange, Inc. - US2576511099 - Common Stock - Currency: USD
Overall DCI gets a fundamental rating of 7 out of 10. We evaluated DCI against 128 industry peers in the Machinery industry. DCI gets an excellent profitability rating and is at the same time showing great financial health properties. DCI is valied quite expensively at the moment, while it does show a decent growth rate.
1. Profitability
1.1 Basic Checks
In the past year DCI was profitable.
DCI had a positive operating cash flow in the past year.
In the past 5 years DCI has always been profitable.
DCI had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
DCI's Return On Assets of 12.09% is amongst the best of the industry. DCI outperforms 87.50% of its industry peers.
Looking at the Return On Equity, with a value of 24.75%, DCI belongs to the top of the industry, outperforming 89.84% of the companies in the same industry.
Looking at the Return On Invested Capital, with a value of 18.57%, DCI belongs to the top of the industry, outperforming 92.97% of the companies in the same industry.
DCI had an Average Return On Invested Capital over the past 3 years of 18.29%. This is significantly above the industry average of 10.69%.
The last Return On Invested Capital (18.57%) for DCI is above the 3 year average (18.29%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 12.09% | ||
| ROE | 24.75% | ||
| ROIC | 18.57% |
ROA(3y)13.32%
ROA(5y)12.67%
ROE(3y)28.11%
ROE(5y)27.12%
ROIC(3y)18.29%
ROIC(5y)17.08%
1.3 Margins
DCI has a better Profit Margin (9.94%) than 67.97% of its industry peers.
DCI's Profit Margin has improved in the last couple of years.
Looking at the Operating Margin, with a value of 15.36%, DCI is in the better half of the industry, outperforming 72.66% of the companies in the same industry.
DCI's Operating Margin has improved in the last couple of years.
DCI's Gross Margin of 35.39% is fine compared to the rest of the industry. DCI outperforms 63.28% of its industry peers.
In the last couple of years the Gross Margin of DCI has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 15.36% | ||
| PM (TTM) | 9.94% | ||
| GM | 35.39% |
OM growth 3Y3.74%
OM growth 5Y2.29%
PM growth 3Y4.72%
PM growth 5Y4.21%
GM growth 3Y1.33%
GM growth 5Y1.35%
2. Health
2.1 Basic Checks
DCI has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
The number of shares outstanding for DCI has been reduced compared to 1 year ago.
Compared to 5 years ago, DCI has less shares outstanding
Compared to 1 year ago, DCI has an improved debt to assets ratio.
2.2 Solvency
An Altman-Z score of 6.62 indicates that DCI is not in any danger for bankruptcy at the moment.
The Altman-Z score of DCI (6.62) is better than 86.72% of its industry peers.
The Debt to FCF ratio of DCI is 2.42, which is a good value as it means it would take DCI, 2.42 years of fcf income to pay off all of its debts.
DCI has a Debt to FCF ratio of 2.42. This is in the better half of the industry: DCI outperforms 69.53% of its industry peers.
DCI has a Debt/Equity ratio of 0.49. This is a healthy value indicating a solid balance between debt and equity.
DCI has a Debt to Equity ratio (0.49) which is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.49 | ||
| Debt/FCF | 2.42 | ||
| Altman-Z | 6.62 |
ROIC/WACC1.9
WACC9.77%
2.3 Liquidity
A Current Ratio of 1.94 indicates that DCI should not have too much problems paying its short term obligations.
With a Current ratio value of 1.94, DCI perfoms like the industry average, outperforming 46.88% of the companies in the same industry.
A Quick Ratio of 1.24 indicates that DCI should not have too much problems paying its short term obligations.
DCI's Quick ratio of 1.24 is in line compared to the rest of the industry. DCI outperforms 53.91% of its industry peers.
DCI 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 | 1.94 | ||
| Quick Ratio | 1.24 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 10.12% over the past year.
Measured over the past years, DCI shows a quite strong growth in Earnings Per Share. The EPS has been growing by 9.03% on average per year.
The Revenue has been growing slightly by 3.26% in the past year.
The Revenue has been growing slightly by 4.74% on average over the past years.
EPS 1Y (TTM)10.12%
EPS 3Y13.81%
EPS 5Y9.03%
EPS Q2Q%7.61%
Revenue 1Y (TTM)3.26%
Revenue growth 3Y7.91%
Revenue growth 5Y4.74%
Sales Q2Q%1.31%
3.2 Future
The Earnings Per Share is expected to grow by 6.78% on average over the next years.
DCI is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 4.26% yearly.
EPS Next Y6.5%
EPS Next 2Y6.4%
EPS Next 3Y6.41%
EPS Next 5Y6.78%
Revenue Next Year1.63%
Revenue Next 2Y2.42%
Revenue Next 3Y3%
Revenue Next 5Y4.26%
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 stable.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 19.66 indicates a rather expensive valuation of DCI.
Compared to the rest of the industry, the Price/Earnings ratio of DCI indicates a somewhat cheap valuation: DCI is cheaper than 64.06% of the companies listed in the same industry.
When comparing the Price/Earnings ratio of DCI to the average of the S&P500 Index (26.59), we can say DCI is valued slightly cheaper.
DCI is valuated rather expensively with a Price/Forward Earnings ratio of 18.23.
DCI's Price/Forward Earnings ratio is in line with the industry average.
When comparing the Price/Forward Earnings ratio of DCI to the average of the S&P500 Index (22.39), we can say DCI is valued inline with the index average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.66 | ||
| Fwd PE | 18.23 |
4.2 Price Multiples
The rest of the industry has a similar Enterprise Value to EBITDA ratio as DCI.
DCI's Price/Free Cash Flow is on the same level as the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 28.25 | ||
| EV/EBITDA | 13.47 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates DCI does not grow enough to justify the current Price/Earnings ratio.
DCI has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)3.02
PEG (5Y)2.18
EPS Next 2Y6.4%
EPS Next 3Y6.41%
5. Dividend
5.1 Amount
DCI has a Yearly Dividend Yield of 1.71%. Purely for dividend investing, there may be better candidates out there.
DCI's Dividend Yield is a higher than the industry average which is at 1.91.
DCI's Dividend Yield is slightly below the S&P500 average, which is at 2.39.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.71% |
5.2 History
The dividend of DCI has a limited annual growth rate of 5.51%.
DCI has been paying a dividend for at least 10 years, so it has a reliable track record.
DCI has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)5.51%
Div Incr Years29
Div Non Decr Years34
5.3 Sustainability
DCI pays out 35.71% of its income as dividend. This is a sustainable payout ratio.
DCI's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP35.71%
EPS Next 2Y6.4%
EPS Next 3Y6.41%
70.58
+0.03 (+0.04%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryMachinery
Earnings (Last)
Earnings (Next)
Inst Owners87.86%
Inst Owner Change1.52%
Ins Owners0.51%
Ins Owner Change0.19%
Market Cap8.44B
Analysts52.86
Price Target71.15 (0.81%)
Short Float %2.12%
Short Ratio4.14
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.71% |
Yearly Dividend1.02
Dividend Growth(5Y)5.51%
DP35.71%
Div Incr Years29
Div Non Decr Years34
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)0.23%
Min EPS beat(2)-3.03%
Max EPS beat(2)3.49%
EPS beat(4)3
Avg EPS beat(4)1.42%
Min EPS beat(4)-3.03%
Max EPS beat(4)5.16%
EPS beat(8)6
Avg EPS beat(8)3.26%
EPS beat(12)8
Avg EPS beat(12)2.11%
EPS beat(16)9
Avg EPS beat(16)1.09%
Revenue beat(2)0
Avg Revenue beat(2)-2.73%
Min Revenue beat(2)-5.17%
Max Revenue beat(2)-0.28%
Revenue beat(4)1
Avg Revenue beat(4)-1.74%
Min Revenue beat(4)-5.17%
Max Revenue beat(4)0.25%
Revenue beat(8)2
Avg Revenue beat(8)-1.51%
Revenue beat(12)4
Avg Revenue beat(12)-0.98%
Revenue beat(16)7
Avg Revenue beat(16)-0.34%
PT rev (1m)-1.2%
PT rev (3m)-6.5%
EPS NQ rev (1m)0.36%
EPS NQ rev (3m)-1.47%
EPS NY rev (1m)-0.03%
EPS NY rev (3m)-0.65%
Revenue NQ rev (1m)-0.28%
Revenue NQ rev (3m)-2.84%
Revenue NY rev (1m)-0.11%
Revenue NY rev (3m)-0.91%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.66 | ||
| Fwd PE | 18.23 | ||
| P/S | 2.31 | ||
| P/FCF | 28.25 | ||
| P/OCF | 22.38 | ||
| P/B | 5.76 | ||
| P/tB | 9.67 | ||
| EV/EBITDA | 13.47 |
EPS(TTM)3.59
EY5.09%
EPS(NY)3.87
Fwd EY5.49%
FCF(TTM)2.5
FCFY3.54%
OCF(TTM)3.15
OCFY4.47%
SpS30.5
BVpS12.25
TBVpS7.3
PEG (NY)3.02
PEG (5Y)2.18
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 12.09% | ||
| ROE | 24.75% | ||
| ROCE | 25.04% | ||
| ROIC | 18.57% | ||
| ROICexc | 20.12% | ||
| ROICexgc | 27.8% | ||
| OM | 15.36% | ||
| PM (TTM) | 9.94% | ||
| GM | 35.39% | ||
| FCFM | 8.19% |
ROA(3y)13.32%
ROA(5y)12.67%
ROE(3y)28.11%
ROE(5y)27.12%
ROIC(3y)18.29%
ROIC(5y)17.08%
ROICexc(3y)20.31%
ROICexc(5y)19.16%
ROICexgc(3y)29.87%
ROICexgc(5y)27.08%
ROCE(3y)24.03%
ROCE(5y)22.48%
ROICexcg growth 3Y10.71%
ROICexcg growth 5Y4.17%
ROICexc growth 3Y5.64%
ROICexc growth 5Y1.68%
OM growth 3Y3.74%
OM growth 5Y2.29%
PM growth 3Y4.72%
PM growth 5Y4.21%
GM growth 3Y1.33%
GM growth 5Y1.35%
F-Score6
Asset Turnover1.22
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.49 | ||
| Debt/FCF | 2.42 | ||
| Debt/EBITDA | 1.09 | ||
| Cap/Depr | 78.4% | ||
| Cap/Sales | 2.15% | ||
| Interest Coverage | 27.59 | ||
| Cash Conversion | 57.12% | ||
| Profit Quality | 82.4% | ||
| Current Ratio | 1.94 | ||
| Quick Ratio | 1.24 | ||
| Altman-Z | 6.62 |
F-Score6
WACC9.77%
ROIC/WACC1.9
Cap/Depr(3y)102.18%
Cap/Depr(5y)102.09%
Cap/Sales(3y)2.81%
Cap/Sales(5y)3.06%
Profit Quality(3y)89.09%
Profit Quality(5y)97.8%
High Growth Momentum
Growth
EPS 1Y (TTM)10.12%
EPS 3Y13.81%
EPS 5Y9.03%
EPS Q2Q%7.61%
EPS Next Y6.5%
EPS Next 2Y6.4%
EPS Next 3Y6.41%
EPS Next 5Y6.78%
Revenue 1Y (TTM)3.26%
Revenue growth 3Y7.91%
Revenue growth 5Y4.74%
Sales Q2Q%1.31%
Revenue Next Year1.63%
Revenue Next 2Y2.42%
Revenue Next 3Y3%
Revenue Next 5Y4.26%
EBIT growth 1Y8%
EBIT growth 3Y11.95%
EBIT growth 5Y7.13%
EBIT Next Year26.06%
EBIT Next 3Y9.82%
EBIT Next 5Y9.36%
FCF growth 1Y-12.46%
FCF growth 3Y5.87%
FCF growth 5Y15.84%
OCF growth 1Y-18.5%
OCF growth 3Y7.01%
OCF growth 5Y7.33%