GENERAC HOLDINGS INC (GNRC) Stock Fundamental Analysis
NYSE:GNRC - New York Stock Exchange, Inc. - US3687361044 - Common Stock - Currency: USD
We assign a fundamental rating of 7 out of 10 to GNRC. GNRC was compared to 96 industry peers in the Electrical Equipment industry. GNRC scores excellent points on both the profitability and health parts. This is a solid base for a good stock. GNRC scores decently on growth, while it is valued quite cheap. This could make an interesting combination. These ratings would make GNRC suitable for value and quality investing!
1. Profitability
1.1 Basic Checks
GNRC had positive earnings in the past year.
In the past year GNRC had a positive cash flow from operations.
In the past 5 years GNRC has always been profitable.
GNRC had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
With an excellent Return On Assets value of 6.83%, GNRC belongs to the best of the industry, outperforming 86.46% of the companies in the same industry.
GNRC has a Return On Equity of 13.99%. This is amongst the best in the industry. GNRC outperforms 85.42% of its industry peers.
GNRC's Return On Invested Capital of 10.25% is amongst the best of the industry. GNRC outperforms 87.50% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for GNRC is in line with the industry average of 9.66%.
The last Return On Invested Capital (10.25%) for GNRC is above the 3 year average (8.99%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.83% | ||
| ROE | 13.99% | ||
| ROIC | 10.25% |
ROA(3y)5.71%
ROA(5y)7.77%
ROE(3y)12.41%
ROE(5y)17.29%
ROIC(3y)8.99%
ROIC(5y)11.14%
1.3 Margins
The Profit Margin of GNRC (7.95%) is better than 85.42% of its industry peers.
In the last couple of years the Profit Margin of GNRC has declined.
The Operating Margin of GNRC (12.73%) is better than 85.42% of its industry peers.
In the last couple of years the Operating Margin of GNRC has declined.
Looking at the Gross Margin, with a value of 39.58%, GNRC belongs to the top of the industry, outperforming 88.54% of the companies in the same industry.
GNRC's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 12.73% | ||
| PM (TTM) | 7.95% | ||
| GM | 39.58% |
OM growth 3Y-14.33%
OM growth 5Y-5.84%
PM growth 3Y-19.05%
PM growth 5Y-8.01%
GM growth 3Y2.13%
GM growth 5Y1.39%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), GNRC is creating some value.
The number of shares outstanding for GNRC has been reduced compared to 1 year ago.
The number of shares outstanding for GNRC has been reduced compared to 5 years ago.
GNRC has a better debt/assets ratio than last year.
2.2 Solvency
An Altman-Z score of 4.00 indicates that GNRC is not in any danger for bankruptcy at the moment.
GNRC's Altman-Z score of 4.00 is fine compared to the rest of the industry. GNRC outperforms 78.13% of its industry peers.
The Debt to FCF ratio of GNRC is 2.42, which is a good value as it means it would take GNRC, 2.42 years of fcf income to pay off all of its debts.
The Debt to FCF ratio of GNRC (2.42) is better than 78.13% of its industry peers.
A Debt/Equity ratio of 0.51 indicates that GNRC is somewhat dependend on debt financing.
Looking at the Debt to Equity ratio, with a value of 0.51, GNRC is in line with its industry, outperforming 47.92% of the companies in the same industry.
Although GNRC 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 | 0.51 | ||
| Debt/FCF | 2.42 | ||
| Altman-Z | 4 |
ROIC/WACC1.22
WACC8.38%
2.3 Liquidity
A Current Ratio of 1.97 indicates that GNRC should not have too much problems paying its short term obligations.
Looking at the Current ratio, with a value of 1.97, GNRC is in line with its industry, outperforming 56.25% of the companies in the same industry.
GNRC has a Quick Ratio of 1.97. This is a bad value and indicates that GNRC is not financially healthy enough and could expect problems in meeting its short term obligations.
GNRC has a worse Quick ratio (0.89) than 62.50% of its industry peers.
GNRC 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 | 1.97 | ||
| Quick Ratio | 0.89 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 35.10% over the past year.
Measured over the past 5 years, GNRC shows a small growth in Earnings Per Share. The EPS has been growing by 7.50% on average per year.
Looking at the last year, GNRC shows a quite strong growth in Revenue. The Revenue has grown by 8.07% in the last year.
Measured over the past years, GNRC shows a quite strong growth in Revenue. The Revenue has been growing by 14.28% on average per year.
EPS 1Y (TTM)35.1%
EPS 3Y-8.9%
EPS 5Y7.5%
EPS Q2Q%43.18%
Revenue 1Y (TTM)8.07%
Revenue growth 3Y4.75%
Revenue growth 5Y14.28%
Sales Q2Q%5.94%
3.2 Future
Based on estimates for the next years, GNRC will show a quite strong growth in Earnings Per Share. The EPS will grow by 11.43% on average per year.
GNRC is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 6.55% yearly.
EPS Next Y9.91%
EPS Next 2Y12.03%
EPS Next 3Y12.17%
EPS Next 5Y11.43%
Revenue Next Year3.14%
Revenue Next 2Y4.94%
Revenue Next 3Y5.71%
Revenue Next 5Y6.55%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better 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 decreasing.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 16.64, which indicates a correct valuation of GNRC.
83.33% of the companies in the same industry are more expensive than GNRC, based on the Price/Earnings ratio.
GNRC is valuated rather cheaply when we compare the Price/Earnings ratio to 25.05, which is the current average of the S&P500 Index.
With a Price/Forward Earnings ratio of 13.95, GNRC is valued correctly.
Compared to the rest of the industry, the Price/Forward Earnings ratio of GNRC indicates a rather cheap valuation: GNRC is cheaper than 85.42% of the companies listed in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 21.07, GNRC is valued a bit cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 16.64 | ||
| Fwd PE | 13.95 |
4.2 Price Multiples
GNRC's Enterprise Value to EBITDA ratio is rather cheap when compared to the industry. GNRC is cheaper than 84.38% of the companies in the same industry.
GNRC's Price/Free Cash Flow ratio is rather cheap when compared to the industry. GNRC is cheaper than 88.54% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 13.82 | ||
| EV/EBITDA | 11.84 |
4.3 Compensation for Growth
GNRC's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
GNRC has an outstanding profitability rating, which may justify a higher PE ratio.
GNRC's earnings are expected to grow with 12.17% in the coming years. This may justify a more expensive valuation.
PEG (NY)1.68
PEG (5Y)2.22
EPS Next 2Y12.03%
EPS Next 3Y12.17%
5. Dividend
5.1 Amount
GNRC does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
127.46
-1.05 (-0.82%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryElectrical Equipment
Earnings (Last)
Earnings (Next)
Inst Owners95.23%
Inst Owner Change1.04%
Ins Owners1.69%
Ins Owner Change2.78%
Market Cap7.56B
Analysts77.5
Price Target158.27 (24.17%)
Short Float %6.38%
Short Ratio4.02
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Yearly DividendN/A
Dividend Growth(5Y)N/A
DP0%
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)18.45%
Min EPS beat(2)9.91%
Max EPS beat(2)26.99%
EPS beat(4)4
Avg EPS beat(4)15.49%
Min EPS beat(4)9.91%
Max EPS beat(4)26.99%
EPS beat(8)6
Avg EPS beat(8)9.86%
EPS beat(12)8
Avg EPS beat(12)9.15%
EPS beat(16)11
Avg EPS beat(16)7.34%
Revenue beat(2)1
Avg Revenue beat(2)-1.07%
Min Revenue beat(2)-2.46%
Max Revenue beat(2)0.33%
Revenue beat(4)1
Avg Revenue beat(4)-1.31%
Min Revenue beat(4)-2.46%
Max Revenue beat(4)0.33%
Revenue beat(8)3
Avg Revenue beat(8)-1.32%
Revenue beat(12)5
Avg Revenue beat(12)-1.43%
Revenue beat(16)8
Avg Revenue beat(16)-0.72%
PT rev (1m)-10.66%
PT rev (3m)-12.4%
EPS NQ rev (1m)-17.17%
EPS NQ rev (3m)-24.01%
EPS NY rev (1m)0.42%
EPS NY rev (3m)-4.37%
Revenue NQ rev (1m)-4.01%
Revenue NQ rev (3m)-7.23%
Revenue NY rev (1m)-1.65%
Revenue NY rev (3m)-4.33%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 16.64 | ||
| Fwd PE | 13.95 | ||
| P/S | 1.74 | ||
| P/FCF | 13.82 | ||
| P/OCF | 10.99 | ||
| P/B | 3.06 | ||
| P/tB | 26.56 | ||
| EV/EBITDA | 11.84 |
EPS(TTM)7.66
EY6.01%
EPS(NY)9.14
Fwd EY7.17%
FCF(TTM)9.22
FCFY7.23%
OCF(TTM)11.6
OCFY9.1%
SpS73.35
BVpS41.65
TBVpS4.8
PEG (NY)1.68
PEG (5Y)2.22
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.83% | ||
| ROE | 13.99% | ||
| ROCE | 13.66% | ||
| ROIC | 10.25% | ||
| ROICexc | 10.74% | ||
| ROICexgc | 24.25% | ||
| OM | 12.73% | ||
| PM (TTM) | 7.95% | ||
| GM | 39.58% | ||
| FCFM | 12.57% |
ROA(3y)5.71%
ROA(5y)7.77%
ROE(3y)12.41%
ROE(5y)17.29%
ROIC(3y)8.99%
ROIC(5y)11.14%
ROICexc(3y)9.45%
ROICexc(5y)12.46%
ROICexgc(3y)21.8%
ROICexgc(5y)31.31%
ROCE(3y)11.98%
ROCE(5y)14.87%
ROICexcg growth 3Y-19.49%
ROICexcg growth 5Y-6.94%
ROICexc growth 3Y-11.87%
ROICexc growth 5Y-6.53%
OM growth 3Y-14.33%
OM growth 5Y-5.84%
PM growth 3Y-19.05%
PM growth 5Y-8.01%
GM growth 3Y2.13%
GM growth 5Y1.39%
F-Score8
Asset Turnover0.86
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.51 | ||
| Debt/FCF | 2.42 | ||
| Debt/EBITDA | 1.72 | ||
| Cap/Depr | 80.03% | ||
| Cap/Sales | 3.24% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 94.25% | ||
| Profit Quality | 158.21% | ||
| Current Ratio | 1.97 | ||
| Quick Ratio | 0.89 | ||
| Altman-Z | 4 |
F-Score8
WACC8.38%
ROIC/WACC1.22
Cap/Depr(3y)70.76%
Cap/Depr(5y)84.39%
Cap/Sales(3y)2.76%
Cap/Sales(5y)2.74%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)35.1%
EPS 3Y-8.9%
EPS 5Y7.5%
EPS Q2Q%43.18%
EPS Next Y9.91%
EPS Next 2Y12.03%
EPS Next 3Y12.17%
EPS Next 5Y11.43%
Revenue 1Y (TTM)8.07%
Revenue growth 3Y4.75%
Revenue growth 5Y14.28%
Sales Q2Q%5.94%
Revenue Next Year3.14%
Revenue Next 2Y4.94%
Revenue Next 3Y5.71%
Revenue Next 5Y6.55%
EBIT growth 1Y35.32%
EBIT growth 3Y-10.26%
EBIT growth 5Y7.6%
EBIT Next Year50.48%
EBIT Next 3Y22.88%
EBIT Next 5Y18.92%
FCF growth 1Y1813.38%
FCF growth 3Y26.14%
FCF growth 5Y19.5%
OCF growth 1Y1273.54%
OCF growth 3Y21.71%
OCF growth 5Y19.13%