TENNANT CO (TNC) Stock Fundamental Analysis
NYSE:TNC - New York Stock Exchange, Inc. - US8803451033 - Common Stock - Currency: USD
Overall TNC gets a fundamental rating of 5 out of 10. We evaluated TNC against 128 industry peers in the Machinery industry. Both the profitability and the financial health of TNC get a neutral evaluation. Nothing too spectacular is happening here. TNC is valued correctly, but it does not seem to be growing.
1. Profitability
1.1 Basic Checks
TNC had positive earnings in the past year.
In the past year TNC had a positive cash flow from operations.
In the past 5 years TNC has always been profitable.
TNC had a positive operating cash flow in 4 of the past 5 years.
1.2 Ratios
TNC has a Return On Assets of 5.80%. This is in the better half of the industry: TNC outperforms 62.50% of its industry peers.
TNC has a Return On Equity (10.95%) which is in line with its industry peers.
With a decent Return On Invested Capital value of 10.06%, TNC is doing good in the industry, outperforming 69.53% of the companies in the same industry.
TNC had an Average Return On Invested Capital over the past 3 years of 11.55%. This is in line with the industry average of 10.30%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.8% | ||
| ROE | 10.95% | ||
| ROIC | 10.06% |
ROA(3y)7.66%
ROA(5y)6.44%
ROE(3y)15.51%
ROE(5y)13.97%
ROIC(3y)11.55%
ROIC(5y)10.25%
1.3 Margins
TNC has a Profit Margin of 5.40%. This is comparable to the rest of the industry: TNC outperforms 51.56% of its industry peers.
In the last couple of years the Profit Margin of TNC has grown nicely.
With a Operating Margin value of 8.71%, TNC perfoms like the industry average, outperforming 50.00% of the companies in the same industry.
In the last couple of years the Operating Margin of TNC has grown nicely.
TNC's Gross Margin of 42.08% is fine compared to the rest of the industry. TNC outperforms 78.91% of its industry peers.
TNC's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 8.71% | ||
| PM (TTM) | 5.4% | ||
| GM | 42.08% |
OM growth 3Y5.7%
OM growth 5Y6.37%
PM growth 3Y3.02%
PM growth 5Y10.07%
GM growth 3Y2.05%
GM growth 5Y1.03%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), TNC is creating some value.
The number of shares outstanding for TNC remains at a similar level compared to 1 year ago.
Compared to 5 years ago, TNC has more shares outstanding
TNC has a better debt/assets ratio than last year.
2.2 Solvency
TNC has an Altman-Z score of 3.91. This indicates that TNC is financially healthy and has little risk of bankruptcy at the moment.
TNC's Altman-Z score of 3.91 is fine compared to the rest of the industry. TNC outperforms 65.63% of its industry peers.
TNC has a debt to FCF ratio of 3.48. This is a good value and a sign of high solvency as TNC would need 3.48 years to pay back of all of its debts.
Looking at the Debt to FCF ratio, with a value of 3.48, TNC is in the better half of the industry, outperforming 62.50% of the companies in the same industry.
A Debt/Equity ratio of 0.34 indicates that TNC is not too dependend on debt financing.
Looking at the Debt to Equity ratio, with a value of 0.34, TNC is in line with its industry, outperforming 57.03% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.34 | ||
| Debt/FCF | 3.48 | ||
| Altman-Z | 3.91 |
ROIC/WACC1.01
WACC9.98%
2.3 Liquidity
TNC has a Current Ratio of 2.14. This indicates that TNC is financially healthy and has no problem in meeting its short term obligations.
The Current ratio of TNC (2.14) is comparable to the rest of the industry.
TNC has a Quick Ratio of 1.40. This is a normal value and indicates that TNC is financially healthy and should not expect problems in meeting its short term obligations.
The Quick ratio of TNC (1.40) is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.14 | ||
| Quick Ratio | 1.4 |
3. Growth
3.1 Past
TNC shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -15.44%.
TNC shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 17.78% yearly.
TNC shows a small growth in Revenue. In the last year, the Revenue has grown by 1.35%.
Measured over the past years, TNC shows a small growth in Revenue. The Revenue has been growing by 2.49% on average per year.
EPS 1Y (TTM)-15.44%
EPS 3Y14.27%
EPS 5Y17.78%
EPS Q2Q%-38.12%
Revenue 1Y (TTM)1.35%
Revenue growth 3Y5.66%
Revenue growth 5Y2.49%
Sales Q2Q%-6.75%
3.2 Future
TNC is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 1.83% yearly.
The Revenue is expected to grow by 0.19% on average over the next years.
EPS Next Y-10.1%
EPS Next 2Y1.83%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue Next Year-4.48%
Revenue Next 2Y0.19%
Revenue Next 3YN/A
Revenue Next 5YN/A
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 decreasing.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 12.70, the valuation of TNC can be described as correct.
88.28% of the companies in the same industry are more expensive than TNC, based on the Price/Earnings ratio.
The average S&P500 Price/Earnings ratio is at 26.25. TNC is valued rather cheaply when compared to this.
The Price/Forward Earnings ratio is 10.96, which indicates a very decent valuation of TNC.
84.38% of the companies in the same industry are more expensive than TNC, based on the Price/Forward Earnings ratio.
TNC's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 22.15.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.7 | ||
| Fwd PE | 10.96 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, TNC is valued a bit cheaper than the industry average as 79.69% of the companies are valued more expensively.
TNC's Price/Free Cash Flow is on the same level as the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 22.57 | ||
| EV/EBITDA | 9.19 |
4.3 Compensation for Growth
TNC has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)0.71
EPS Next 2Y1.83%
EPS Next 3YN/A
5. Dividend
5.1 Amount
TNC has a Yearly Dividend Yield of 1.58%.
Compared to an average industry Dividend Yield of 1.90, TNC pays a bit more dividend than its industry peers.
TNC's Dividend Yield is slightly below the S&P500 average, which is at 2.40.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.58% |
5.2 History
The dividend of TNC has a limited annual growth rate of 5.49%.
TNC has paid a dividend for at least 10 years, which is a reliable track record.
TNC has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)5.49%
Div Incr Years34
Div Non Decr Years34
5.3 Sustainability
TNC pays out 31.73% of its income as dividend. This is a sustainable payout ratio.
The dividend of TNC is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP31.73%
EPS Next 2Y1.83%
EPS Next 3YN/A
74.42
-0.12 (-0.16%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryMachinery
Earnings (Last)
Earnings (Next)
Inst Owners96.05%
Inst Owner Change0.13%
Ins Owners1.07%
Ins Owner Change11.38%
Market Cap1.39B
Analysts85.71
Price Target121.72 (63.56%)
Short Float %2.82%
Short Ratio3.07
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.58% |
Yearly Dividend1.15
Dividend Growth(5Y)5.49%
DP31.73%
Div Incr Years34
Div Non Decr Years34
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-2.67%
Min EPS beat(2)-14.92%
Max EPS beat(2)9.58%
EPS beat(4)2
Avg EPS beat(4)-0.94%
Min EPS beat(4)-14.92%
Max EPS beat(4)9.58%
EPS beat(8)6
Avg EPS beat(8)18.62%
EPS beat(12)9
Avg EPS beat(12)19.51%
EPS beat(16)12
Avg EPS beat(16)18.82%
Revenue beat(2)1
Avg Revenue beat(2)-1.23%
Min Revenue beat(2)-3.2%
Max Revenue beat(2)0.74%
Revenue beat(4)2
Avg Revenue beat(4)-1.1%
Min Revenue beat(4)-3.2%
Max Revenue beat(4)0.74%
Revenue beat(8)4
Avg Revenue beat(8)0.65%
Revenue beat(12)6
Avg Revenue beat(12)0.52%
Revenue beat(16)7
Avg Revenue beat(16)-0.31%
PT rev (1m)-7.73%
PT rev (3m)-6.77%
EPS NQ rev (1m)1.54%
EPS NQ rev (3m)-5.46%
EPS NY rev (1m)-1.69%
EPS NY rev (3m)-11.4%
Revenue NQ rev (1m)-1.31%
Revenue NQ rev (3m)-8.12%
Revenue NY rev (1m)-1.51%
Revenue NY rev (3m)-7.76%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.7 | ||
| Fwd PE | 10.96 | ||
| P/S | 1.1 | ||
| P/FCF | 22.57 | ||
| P/OCF | 16.06 | ||
| P/B | 2.22 | ||
| P/tB | 3.71 | ||
| EV/EBITDA | 9.19 |
EPS(TTM)5.86
EY7.87%
EPS(NY)6.79
Fwd EY9.13%
FCF(TTM)3.3
FCFY4.43%
OCF(TTM)4.63
OCFY6.23%
SpS67.87
BVpS33.48
TBVpS20.07
PEG (NY)N/A
PEG (5Y)0.71
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.8% | ||
| ROE | 10.95% | ||
| ROCE | 11.95% | ||
| ROIC | 10.06% | ||
| ROICexc | 11.01% | ||
| ROICexgc | 15.65% | ||
| OM | 8.71% | ||
| PM (TTM) | 5.4% | ||
| GM | 42.08% | ||
| FCFM | 4.86% |
ROA(3y)7.66%
ROA(5y)6.44%
ROE(3y)15.51%
ROE(5y)13.97%
ROIC(3y)11.55%
ROIC(5y)10.25%
ROICexc(3y)13.11%
ROICexc(5y)11.83%
ROICexgc(3y)19.67%
ROICexgc(5y)19.23%
ROCE(3y)13.73%
ROCE(5y)12.18%
ROICexcg growth 3Y-3.55%
ROICexcg growth 5Y1.17%
ROICexc growth 3Y4.18%
ROICexc growth 5Y6.62%
OM growth 3Y5.7%
OM growth 5Y6.37%
PM growth 3Y3.02%
PM growth 5Y10.07%
GM growth 3Y2.05%
GM growth 5Y1.03%
F-Score4
Asset Turnover1.07
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.34 | ||
| Debt/FCF | 3.48 | ||
| Debt/EBITDA | 1.29 | ||
| Cap/Depr | 44.78% | ||
| Cap/Sales | 1.97% | ||
| Interest Coverage | 9.19 | ||
| Cash Conversion | 52.08% | ||
| Profit Quality | 89.91% | ||
| Current Ratio | 2.14 | ||
| Quick Ratio | 1.4 | ||
| Altman-Z | 3.91 |
F-Score4
WACC9.98%
ROIC/WACC1.01
Cap/Depr(3y)44.63%
Cap/Depr(5y)45.36%
Cap/Sales(3y)1.92%
Cap/Sales(5y)2.11%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-15.44%
EPS 3Y14.27%
EPS 5Y17.78%
EPS Q2Q%-38.12%
EPS Next Y-10.1%
EPS Next 2Y1.83%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue 1Y (TTM)1.35%
Revenue growth 3Y5.66%
Revenue growth 5Y2.49%
Sales Q2Q%-6.75%
Revenue Next Year-4.48%
Revenue Next 2Y0.19%
Revenue Next 3YN/A
Revenue Next 5YN/A
EBIT growth 1Y-23.08%
EBIT growth 3Y11.69%
EBIT growth 5Y9.02%
EBIT Next Year42.64%
EBIT Next 3YN/A
EBIT Next 5YN/A
FCF growth 1Y674.77%
FCF growth 3Y11.3%
FCF growth 5Y15.83%
OCF growth 1Y436.65%
OCF growth 3Y8.93%
OCF growth 5Y4.52%