TEMPUR SEALY INTERNATIONAL I (TPX)

US88023U1016 - Common Stock

49.13  +0.37 (+0.76%)

After market: 49.13 0 (0%)

Fundamental Rating

5

We assign a fundamental rating of 5 out of 10 to TPX. TPX was compared to 68 industry peers in the Household Durables industry. TPX has an excellent profitability rating, but there are concerns on its financial health. TPX is quite expensive at the moment. It does show a decent growth rate.



8

1. Profitability

1.1 Basic Checks

In the past year TPX was profitable.
TPX had a positive operating cash flow in the past year.
Each year in the past 5 years TPX has been profitable.
In the past 5 years TPX always reported a positive cash flow from operatings.

1.2 Ratios

TPX has a Return On Assets of 8.08%. This is in the better half of the industry: TPX outperforms 68.66% of its industry peers.
The Return On Equity of TPX (113.82%) is better than 100.00% of its industry peers.
TPX has a better Return On Invested Capital (12.84%) than 79.10% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for TPX is significantly above the industry average of 10.06%.
Industry RankSector Rank
ROA 8.08%
ROE 113.82%
ROIC 12.84%
ROA(3y)10.99%
ROA(5y)9.94%
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)16.49%
ROIC(5y)15.86%

1.3 Margins

TPX has a better Profit Margin (7.47%) than 62.69% of its industry peers.
In the last couple of years the Profit Margin of TPX has grown nicely.
Looking at the Operating Margin, with a value of 12.07%, TPX is in the better half of the industry, outperforming 74.63% of the companies in the same industry.
TPX's Operating Margin has improved in the last couple of years.
Looking at the Gross Margin, with a value of 43.42%, TPX belongs to the top of the industry, outperforming 80.60% of the companies in the same industry.
TPX's Gross Margin has been stable in the last couple of years.
Industry RankSector Rank
OM 12.07%
PM (TTM) 7.47%
GM 43.42%
OM growth 3Y-4.89%
OM growth 5Y3.81%
PM growth 3Y-7.64%
PM growth 5Y14.98%
GM growth 3Y-0.86%
GM growth 5Y0.37%

3

2. Health

2.1 Basic Checks

The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so TPX is still creating some value.
Compared to 1 year ago, TPX has more shares outstanding
TPX has less shares outstanding than it did 5 years ago.
The debt/assets ratio for TPX has been reduced compared to a year ago.

2.2 Solvency

TPX has an Altman-Z score of 3.77. This indicates that TPX is financially healthy and has little risk of bankruptcy at the moment.
TPX's Altman-Z score of 3.77 is fine compared to the rest of the industry. TPX outperforms 64.18% of its industry peers.
The Debt to FCF ratio of TPX is 6.68, which is on the high side as it means it would take TPX, 6.68 years of fcf income to pay off all of its debts.
TPX has a Debt to FCF ratio of 6.68. This is in the lower half of the industry: TPX underperforms 61.19% of its industry peers.
TPX has a Debt/Equity ratio of 7.81. This is a high value indicating a heavy dependency on external financing.
The Debt to Equity ratio of TPX (7.81) is worse than 95.52% of its industry peers.
Industry RankSector Rank
Debt/Equity 7.81
Debt/FCF 6.68
Altman-Z 3.77
ROIC/WACC1.23
WACC10.46%

2.3 Liquidity

TPX has a Current Ratio of 1.21. This is a normal value and indicates that TPX is financially healthy and should not expect problems in meeting its short term obligations.
With a Current ratio value of 1.21, TPX is not doing good in the industry: 89.55% of the companies in the same industry are doing better.
TPX has a Quick Ratio of 1.21. This is a bad value and indicates that TPX is not financially healthy enough and could expect problems in meeting its short term obligations.
TPX has a Quick ratio of 0.68. This is in the lower half of the industry: TPX underperforms 74.63% of its industry peers.
Industry RankSector Rank
Current Ratio 1.21
Quick Ratio 0.68

5

3. Growth

3.1 Past

TPX shows a slight negative growth in Earnings Per Share. In the last year, the EPS has decreased by -6.95%.
TPX shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 27.51% yearly.
Looking at the last year, TPX shows a small growth in Revenue. The Revenue has grown by 0.09% in the last year.
The Revenue has been growing by 12.75% on average over the past years. This is quite good.
EPS 1Y (TTM)-6.95%
EPS 3Y8.06%
EPS 5Y27.51%
EPS growth Q2Q-1.85%
Revenue 1Y (TTM)0.09%
Revenue growth 3Y10.24%
Revenue growth 5Y12.75%
Revenue growth Q2Q-1.42%

3.2 Future

Based on estimates for the next years, TPX will show a quite strong growth in Earnings Per Share. The EPS will grow by 12.48% on average per year.
Based on estimates for the next years, TPX will show a small growth in Revenue. The Revenue will grow by 3.92% on average per year.
EPS Next Y15.25%
EPS Next 2Y15.99%
EPS Next 3Y12.97%
EPS Next 5Y12.48%
Revenue Next Year4%
Revenue Next 2Y4.5%
Revenue Next 3Y4.06%
Revenue Next 5Y3.92%

3.3 Evolution

Although the future EPS growth is still strong, it is not able to hold up the even more excellent growth rate of the past 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.

3

4. Valuation

4.1 Price/Earnings Ratio

The Price/Earnings ratio is 20.39, which indicates a rather expensive current valuation of TPX.
Compared to the rest of the industry, the Price/Earnings ratio of TPX is on the same level as its industry peers.
TPX is valuated at similar levels of the S&P average when we compare the Price/Earnings ratio to 24.95, which is the current average of the S&P500 Index.
Based on the Price/Forward Earnings ratio of 17.69, the valuation of TPX can be described as rather expensive.
TPX's Price/Forward Earnings is on the same level as the industry average.
The average S&P500 Price/Forward Earnings ratio is at 21.40. TPX is around the same levels.
Industry RankSector Rank
PE 20.39
Fwd PE 17.69

4.2 Price Multiples

65.67% of the companies in the same industry are cheaper than TPX, based on the Enterprise Value to EBITDA ratio.
Based on the Price/Free Cash Flow ratio, TPX is valued a bit more expensive than 68.66% of the companies in the same industry.
Industry RankSector Rank
P/FCF 22.16
EV/EBITDA 15.02

4.3 Compensation for Growth

TPX's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
The excellent profitability rating of TPX may justify a higher PE ratio.
TPX's earnings are expected to grow with 12.97% in the coming years. This may justify a more expensive valuation.
PEG (NY)1.34
PEG (5Y)0.74
EPS Next 2Y15.99%
EPS Next 3Y12.97%

4

5. Dividend

5.1 Amount

With a Yearly Dividend Yield of 1.05%, TPX has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 3.34, TPX pays a bit more dividend than its industry peers.
With a Dividend Yield of 1.05, TPX pays less dividend than the S&P500 average, which is at 2.45.
Industry RankSector Rank
Dividend Yield 1.05%

5.2 History

The dividend of TPX is nicely growing with an annual growth rate of 43.15%!
TPX has been paying a dividend for over 5 years, so it has already some track record.
The dividend of TPX decreased in the last 3 years.
Dividend Growth(5Y)43.15%
Div Incr Years2
Div Non Decr Years2

5.3 Sustainability

21.11% of the earnings are spent on dividend by TPX. This is a low number and sustainable payout ratio.
TPX's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP21.11%
EPS Next 2Y15.99%
EPS Next 3Y12.97%

TEMPUR SEALY INTERNATIONAL I

NYSE:TPX (4/22/2024, 4:37:16 PM)

After market: 49.13 0 (0%)

49.13

+0.37 (+0.76%)

Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Durables & Apparel
GICS IndustryHousehold Durables
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap8.53B
Analysts
Price Target
Dividend
Industry RankSector Rank
Dividend Yield 1.05%
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
Avg EPS beat(2)
Min EPS beat(2)
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PT rev (1m)
PT rev (3m)
EPS NQ rev (1m)
EPS NQ rev (3m)
EPS NY rev (1m)
EPS NY rev (3m)
Revenue NQ rev (1m)
Revenue NQ rev (3m)
Revenue NY rev (1m)
Revenue NY rev (3m)
Valuation
Industry RankSector Rank
PE 20.39
Fwd PE 17.69
P/S
P/FCF
P/OCF
P/B
P/tB
EV/EBITDA
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)1.34
PEG (5Y)0.74
Profitability
Industry RankSector Rank
ROA 8.08%
ROE 113.82%
ROCE
ROIC
ROICexc
ROICexgc
OM 12.07%
PM (TTM) 7.47%
GM 43.42%
FCFM
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover1.08
Health
Industry RankSector Rank
Debt/Equity 7.81
Debt/FCF
Debt/EBITDA
Cap/Depr
Cap/Sales
Interest Coverage
Cash Conversion
Profit Quality
Current Ratio 1.21
Quick Ratio 0.68
Altman-Z
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
Growth
EPS 1Y (TTM)-6.95%
EPS 3Y8.06%
EPS 5Y
EPS growth Q2Q
EPS Next Y15.25%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)0.09%
Revenue growth 3Y10.24%
Revenue growth 5Y
Revenue growth Q2Q
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y