GATES INDUSTRIAL CORP PLC (GTES) Stock Fundamental Analysis
NYSE:GTES - New York Stock Exchange, Inc. - GB00BD9G2S12 - Common Stock - Currency: USD
GTES gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 127 industry peers in the Machinery industry. Both the profitability and the financial health of GTES get a neutral evaluation. Nothing too spectacular is happening here. GTES has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
In the past year GTES was profitable.
GTES had a positive operating cash flow in the past year.
In the past 5 years GTES has always been profitable.
GTES had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
GTES has a Return On Assets (3.15%) which is in line with its industry peers.
GTES's Return On Equity of 6.99% is in line compared to the rest of the industry. GTES outperforms 41.73% of its industry peers.
The Return On Invested Capital of GTES (6.52%) is comparable to the rest of the industry.
The Average Return On Invested Capital over the past 3 years for GTES is below the industry average of 10.90%.
The 3 year average ROIC (5.94%) for GTES is below the current ROIC(6.52%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.15% | ||
| ROE | 6.99% | ||
| ROIC | 6.52% |
ROA(3y)3.05%
ROA(5y)2.83%
ROE(3y)6.93%
ROE(5y)6.64%
ROIC(3y)5.94%
ROIC(5y)5.37%
1.3 Margins
GTES has a Profit Margin of 6.39%. This is comparable to the rest of the industry: GTES outperforms 54.33% of its industry peers.
In the last couple of years the Profit Margin of GTES has declined.
With a decent Operating Margin value of 15.09%, GTES is doing good in the industry, outperforming 70.87% of the companies in the same industry.
In the last couple of years the Operating Margin of GTES has grown nicely.
The Gross Margin of GTES (40.77%) is better than 76.38% of its industry peers.
GTES's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 15.09% | ||
| PM (TTM) | 6.39% | ||
| GM | 40.77% |
OM growth 3Y1.81%
OM growth 5Y5.56%
PM growth 3Y-12.55%
PM growth 5Y-23.86%
GM growth 3Y1.68%
GM growth 5Y1.85%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), GTES is destroying value.
The number of shares outstanding for GTES has been reduced compared to 1 year ago.
The number of shares outstanding for GTES has been reduced compared to 5 years ago.
GTES has a worse debt/assets ratio than last year.
2.2 Solvency
An Altman-Z score of 2.35 indicates that GTES is not a great score, but indicates only limited risk for bankruptcy at the moment.
GTES has a worse Altman-Z score (2.35) than 62.99% of its industry peers.
The Debt to FCF ratio of GTES is 7.98, which is on the high side as it means it would take GTES, 7.98 years of fcf income to pay off all of its debts.
Looking at the Debt to FCF ratio, with a value of 7.98, GTES is in line with its industry, outperforming 42.52% of the companies in the same industry.
A Debt/Equity ratio of 0.74 indicates that GTES is somewhat dependend on debt financing.
GTES has a Debt to Equity ratio of 0.74. This is in the lower half of the industry: GTES underperforms 70.87% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.74 | ||
| Debt/FCF | 7.98 | ||
| Altman-Z | 2.35 |
ROIC/WACC0.68
WACC9.55%
2.3 Liquidity
GTES has a Current Ratio of 3.33. This indicates that GTES is financially healthy and has no problem in meeting its short term obligations.
GTES's Current ratio of 3.33 is amongst the best of the industry. GTES outperforms 81.10% of its industry peers.
GTES has a Quick Ratio of 2.35. This indicates that GTES is financially healthy and has no problem in meeting its short term obligations.
GTES's Quick ratio of 2.35 is fine compared to the rest of the industry. GTES outperforms 79.53% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 3.33 | ||
| Quick Ratio | 2.35 |
3. Growth
3.1 Past
GTES shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 0.00%.
The Earnings Per Share has been growing slightly by 7.44% on average over the past years.
The Revenue has decreased by -4.01% in the past year.
GTES shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 2.00% yearly.
EPS 1Y (TTM)0%
EPS 3Y-0.24%
EPS 5Y7.44%
EPS Q2Q%16.13%
Revenue 1Y (TTM)-4.01%
Revenue growth 3Y-0.64%
Revenue growth 5Y2%
Sales Q2Q%-1.74%
3.2 Future
GTES is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 11.70% yearly.
Based on estimates for the next years, GTES will show a small growth in Revenue. The Revenue will grow by 2.53% on average per year.
EPS Next Y8.11%
EPS Next 2Y11.89%
EPS Next 3Y11.7%
EPS Next 5YN/A
Revenue Next Year-0.46%
Revenue Next 2Y1.97%
Revenue Next 3Y2.53%
Revenue Next 5YN/A
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 17.56 indicates a rather expensive valuation of GTES.
GTES's Price/Earnings ratio is a bit cheaper when compared to the industry. GTES is cheaper than 72.44% of the companies in the same industry.
GTES is valuated rather cheaply when we compare the Price/Earnings ratio to 27.91, which is the current average of the S&P500 Index.
The Price/Forward Earnings ratio is 14.54, which indicates a correct valuation of GTES.
75.59% of the companies in the same industry are more expensive than GTES, based on the Price/Forward Earnings ratio.
Compared to an average S&P500 Price/Forward Earnings ratio of 37.11, GTES is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 17.56 | ||
| Fwd PE | 14.54 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of GTES indicates a somewhat cheap valuation: GTES is cheaper than 69.29% of the companies listed in the same industry.
Based on the Price/Free Cash Flow ratio, GTES is valued a bit cheaper than the industry average as 60.63% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 21.78 | ||
| EV/EBITDA | 11.12 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates GTES does not grow enough to justify the current Price/Earnings ratio.
GTES has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)2.17
PEG (5Y)2.36
EPS Next 2Y11.89%
EPS Next 3Y11.7%
5. Dividend
5.1 Amount
No dividends for GTES!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
24.76
-0.5 (-1.98%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryMachinery
Earnings (Last)
Earnings (Next)
Inst Owners105.61%
Inst Owner Change-0.19%
Ins Owners1.72%
Ins Owner Change34.07%
Market Cap6.38B
Analysts82.35
Price Target26.06 (5.25%)
Short Float %2.33%
Short Ratio3.58
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Yearly DividendN/A
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)6.73%
Min EPS beat(2)6.72%
Max EPS beat(2)6.74%
EPS beat(4)3
Avg EPS beat(4)4.46%
Min EPS beat(4)-1.33%
Max EPS beat(4)6.74%
EPS beat(8)6
Avg EPS beat(8)8.45%
EPS beat(12)8
Avg EPS beat(12)6.9%
EPS beat(16)11
Avg EPS beat(16)9.49%
Revenue beat(2)1
Avg Revenue beat(2)-0.4%
Min Revenue beat(2)-1.79%
Max Revenue beat(2)0.98%
Revenue beat(4)1
Avg Revenue beat(4)-1.47%
Min Revenue beat(4)-3.07%
Max Revenue beat(4)0.98%
Revenue beat(8)1
Avg Revenue beat(8)-1.83%
Revenue beat(12)2
Avg Revenue beat(12)-1.81%
Revenue beat(16)3
Avg Revenue beat(16)-1.63%
PT rev (1m)5.24%
PT rev (3m)7.66%
EPS NQ rev (1m)2.02%
EPS NQ rev (3m)0.58%
EPS NY rev (1m)0.56%
EPS NY rev (3m)0.93%
Revenue NQ rev (1m)0.48%
Revenue NQ rev (3m)0.8%
Revenue NY rev (1m)0.09%
Revenue NY rev (3m)0.38%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 17.56 | ||
| Fwd PE | 14.54 | ||
| P/S | 1.88 | ||
| P/FCF | 21.78 | ||
| P/OCF | 15.65 | ||
| P/B | 2.06 | ||
| P/tB | N/A | ||
| EV/EBITDA | 11.12 |
EPS(TTM)1.41
EY5.69%
EPS(NY)1.7
Fwd EY6.88%
FCF(TTM)1.14
FCFY4.59%
OCF(TTM)1.58
OCFY6.39%
SpS13.16
BVpS12.04
TBVpS-0.25
PEG (NY)2.17
PEG (5Y)2.36
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.15% | ||
| ROE | 6.99% | ||
| ROCE | 8.29% | ||
| ROIC | 6.52% | ||
| ROICexc | 7.28% | ||
| ROICexgc | 17% | ||
| OM | 15.09% | ||
| PM (TTM) | 6.39% | ||
| GM | 40.77% | ||
| FCFM | 8.64% |
ROA(3y)3.05%
ROA(5y)2.83%
ROE(3y)6.93%
ROE(5y)6.64%
ROIC(3y)5.94%
ROIC(5y)5.37%
ROICexc(3y)6.65%
ROICexc(5y)5.97%
ROICexgc(3y)16.26%
ROICexgc(5y)15.01%
ROCE(3y)7.56%
ROCE(5y)6.83%
ROICexcg growth 3Y2.48%
ROICexcg growth 5Y7.25%
ROICexc growth 3Y5%
ROICexc growth 5Y10.47%
OM growth 3Y1.81%
OM growth 5Y5.56%
PM growth 3Y-12.55%
PM growth 5Y-23.86%
GM growth 3Y1.68%
GM growth 5Y1.85%
F-Score6
Asset Turnover0.49
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.74 | ||
| Debt/FCF | 7.98 | ||
| Debt/EBITDA | 3.18 | ||
| Cap/Depr | 53.52% | ||
| Cap/Sales | 3.38% | ||
| Interest Coverage | 4.14 | ||
| Cash Conversion | 56.15% | ||
| Profit Quality | 135.13% | ||
| Current Ratio | 3.33 | ||
| Quick Ratio | 2.35 | ||
| Altman-Z | 2.35 |
F-Score6
WACC9.55%
ROIC/WACC0.68
Cap/Depr(3y)40.69%
Cap/Depr(5y)38.4%
Cap/Sales(3y)2.53%
Cap/Sales(5y)2.5%
Profit Quality(3y)132.29%
Profit Quality(5y)160.12%
High Growth Momentum
Growth
EPS 1Y (TTM)0%
EPS 3Y-0.24%
EPS 5Y7.44%
EPS Q2Q%16.13%
EPS Next Y8.11%
EPS Next 2Y11.89%
EPS Next 3Y11.7%
EPS Next 5YN/A
Revenue 1Y (TTM)-4.01%
Revenue growth 3Y-0.64%
Revenue growth 5Y2%
Sales Q2Q%-1.74%
Revenue Next Year-0.46%
Revenue Next 2Y1.97%
Revenue Next 3Y2.53%
Revenue Next 5YN/A
EBIT growth 1Y0.71%
EBIT growth 3Y1.16%
EBIT growth 5Y7.67%
EBIT Next Year28.21%
EBIT Next 3Y14.33%
EBIT Next 5YN/A
FCF growth 1Y-13.82%
FCF growth 3Y-2.61%
FCF growth 5Y0.53%
OCF growth 1Y-3.73%
OCF growth 3Y-0.24%
OCF growth 5Y1.7%