TRANE TECHNOLOGIES PLC (TT) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:TT - IE00BK9ZQ967 - Common Stock
381.7 USD
+3.34 (+0.88%)
381.7 USD
0 (0%)
Taking everything into account, TT scores 7 out of 10 in our fundamental rating. TT was compared to 42 industry peers in the Building Products industry. Both the health and profitability get an excellent rating, making TT a very profitable company, without any liquidiy or solvency issues. While showing a medium growth rate, TT is valued expensive at the moment. With these ratings, TT could be worth investigating further for quality investing!.
1. Profitability
1.1 Basic Checks
TT had positive earnings in the past year.
TT had a positive operating cash flow in the past year.
Each year in the past 5 years TT has been profitable.
Each year in the past 5 years TT had a positive operating cash flow.
1.2 Ratios
Looking at the Return On Assets, with a value of 13.72%, TT belongs to the top of the industry, outperforming 85.71% of the companies in the same industry.
With an excellent Return On Equity value of 35.21%, TT belongs to the best of the industry, outperforming 92.86% of the companies in the same industry.
TT's Return On Invested Capital of 21.47% is amongst the best of the industry. TT outperforms 90.48% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for TT is significantly above the industry average of 12.61%.
The last Return On Invested Capital (21.47%) for TT is above the 3 year average (17.76%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 13.72% | ||
| ROE | 35.21% | ||
| ROIC | 21.47% |
ROA(3y)10.97%
ROA(5y)9.1%
ROE(3y)30.74%
ROE(5y)25.66%
ROIC(3y)17.76%
ROIC(5y)15.01%
1.3 Margins
TT's Profit Margin of 13.93% is fine compared to the rest of the industry. TT outperforms 71.43% of its industry peers.
TT's Profit Margin has improved in the last couple of years.
Looking at the Operating Margin, with a value of 18.79%, TT is in the better half of the industry, outperforming 73.81% of the companies in the same industry.
In the last couple of years the Operating Margin of TT has grown nicely.
TT has a better Gross Margin (36.42%) than 64.29% of its industry peers.
TT's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 18.79% | ||
| PM (TTM) | 13.93% | ||
| GM | 36.42% |
OM growth 3Y6.75%
OM growth 5Y6.01%
PM growth 3Y8.74%
PM growth 5Y3.71%
GM growth 3Y4.06%
GM growth 5Y2.99%
2. Health
2.1 Basic Checks
TT has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
Compared to 1 year ago, TT has less shares outstanding
Compared to 5 years ago, TT has less shares outstanding
Compared to 1 year ago, TT has an improved debt to assets ratio.
2.2 Solvency
TT has an Altman-Z score of 6.20. This indicates that TT is financially healthy and has little risk of bankruptcy at the moment.
TT has a Altman-Z score of 6.20. This is in the better half of the industry: TT outperforms 76.19% of its industry peers.
TT has a debt to FCF ratio of 1.82. This is a very positive value and a sign of high solvency as it would only need 1.82 years to pay back of all of its debts.
TT's Debt to FCF ratio of 1.82 is fine compared to the rest of the industry. TT outperforms 76.19% of its industry peers.
TT has a Debt/Equity ratio of 0.47. This is a healthy value indicating a solid balance between debt and equity.
The Debt to Equity ratio of TT (0.47) is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.47 | ||
| Debt/FCF | 1.82 | ||
| Altman-Z | 6.2 |
ROIC/WACC2.93
WACC7.34%
2.3 Liquidity
TT has a Current Ratio of 1.20. This is a normal value and indicates that TT is financially healthy and should not expect problems in meeting its short term obligations.
TT has a Current ratio of 1.20. This is amonst the worse of the industry: TT underperforms 85.71% of its industry peers.
A Quick Ratio of 0.84 indicates that TT may have some problems paying its short term obligations.
With a Quick ratio value of 0.84, TT is not doing good in the industry: 80.95% of the companies in the same industry are doing better.
TT 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 | 1.2 | ||
| Quick Ratio | 0.84 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 18.92% over the past year.
The Earnings Per Share has been growing by 11.99% on average over the past years. This is quite good.
TT shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 8.58%.
Measured over the past years, TT shows a quite strong growth in Revenue. The Revenue has been growing by 8.69% on average per year.
EPS 1Y (TTM)18.92%
EPS 3Y22.59%
EPS 5Y11.99%
EPS Q2Q%15.13%
Revenue 1Y (TTM)8.58%
Revenue growth 3Y11.96%
Revenue growth 5Y8.69%
Sales Q2Q%5.54%
3.2 Future
The Earnings Per Share is expected to grow by 10.27% on average over the next years. This is quite good.
TT is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 7.20% yearly.
EPS Next Y19.57%
EPS Next 2Y16.76%
EPS Next 3Y15.53%
EPS Next 5Y10.27%
Revenue Next Year7.75%
Revenue Next 2Y7.71%
Revenue Next 3Y7.66%
Revenue Next 5Y7.2%
3.3 Evolution
The EPS growth rate is stable: in the next years the growth will be about the same than in the last years.
The Revenue growth rate is stable: in the next years the growth will be about the same than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 29.77, the valuation of TT can be described as expensive.
TT's Price/Earnings ratio is a bit more expensive when compared to the industry. TT is more expensive than 69.05% of the companies in the same industry.
TT is valuated at similar levels of the S&P average when we compare the Price/Earnings ratio to 27.19, which is the current average of the S&P500 Index.
The Price/Forward Earnings ratio is 24.96, which indicates a rather expensive current valuation of TT.
66.67% of the companies in the same industry are cheaper than TT, based on the Price/Forward Earnings ratio.
Compared to an average S&P500 Price/Forward Earnings ratio of 23.88, TT is valued at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 29.77 | ||
| Fwd PE | 24.96 |
4.2 Price Multiples
69.05% of the companies in the same industry are cheaper than TT, based on the Enterprise Value to EBITDA ratio.
TT's Price/Free Cash Flow ratio is in line with the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 33.42 | ||
| EV/EBITDA | 20.14 |
4.3 Compensation for Growth
The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
TT has an outstanding profitability rating, which may justify a higher PE ratio.
A more expensive valuation may be justified as TT's earnings are expected to grow with 15.53% in the coming years.
PEG (NY)1.52
PEG (5Y)2.48
EPS Next 2Y16.76%
EPS Next 3Y15.53%
5. Dividend
5.1 Amount
With a yearly dividend of 0.97%, TT is not a good candidate for dividend investing.
TT's Dividend Yield is a higher than the industry average which is at 0.71.
Compared to an average S&P500 Dividend Yield of 1.90, TT's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.97% |
5.2 History
On average, the dividend of TT grows each year by 9.56%, which is quite nice.
TT has paid a dividend for at least 10 years, which is a reliable track record.
TT has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)9.56%
Div Incr Years14
Div Non Decr Years14
5.3 Sustainability
TT pays out 27.90% of its income as dividend. This is a sustainable payout ratio.
TT's earnings are growing around the same pace than its dividend. As long as the earnings growth is kept the dividend growth is sustainable.
DP27.9%
EPS Next 2Y16.76%
EPS Next 3Y15.53%
381.7
+3.34 (+0.88%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryBuilding Products
Earnings (Last)
Earnings (Next)
Inst Owners90.31%
Inst Owner Change0%
Ins Owners0.25%
Ins Owner Change0.52%
Market Cap84.64B
Revenue(TTM)21.05B
Net Income(TTM)2.93B
Analysts72.73
Price Target489.7 (28.29%)
Short Float %1.36%
Short Ratio2.36
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.97% |
Yearly Dividend3.35
Dividend Growth(5Y)9.56%
DP27.9%
Div Incr Years14
Div Non Decr Years14
Ex-DateN/A
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-0.51%
Min EPS beat(2)-0.67%
Max EPS beat(2)-0.35%
EPS beat(4)1
Avg EPS beat(4)1.55%
Min EPS beat(4)-0.67%
Max EPS beat(4)7.49%
EPS beat(8)4
Avg EPS beat(8)2.85%
EPS beat(12)8
Avg EPS beat(12)3.02%
EPS beat(16)11
Avg EPS beat(16)3.16%
Revenue beat(2)0
Avg Revenue beat(2)-3.52%
Min Revenue beat(2)-3.65%
Max Revenue beat(2)-3.39%
Revenue beat(4)1
Avg Revenue beat(4)-1.63%
Min Revenue beat(4)-3.65%
Max Revenue beat(4)1.64%
Revenue beat(8)3
Avg Revenue beat(8)-0.97%
Revenue beat(12)4
Avg Revenue beat(12)-0.99%
Revenue beat(16)6
Avg Revenue beat(16)-0.59%
PT rev (1m)-0.38%
PT rev (3m)4.3%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-3.55%
EPS NY rev (1m)0.01%
EPS NY rev (3m)-0.16%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-3.67%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-1.44%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 29.77 | ||
| Fwd PE | 24.96 | ||
| P/S | 4.02 | ||
| P/FCF | 33.42 | ||
| P/OCF | 28.83 | ||
| P/B | 10.17 | ||
| P/tB | N/A | ||
| EV/EBITDA | 20.14 |
EPS(TTM)12.82
EY3.36%
EPS(NY)15.3
Fwd EY4.01%
FCF(TTM)11.42
FCFY2.99%
OCF(TTM)13.24
OCFY3.47%
SpS94.94
BVpS37.55
TBVpS-6.27
PEG (NY)1.52
PEG (5Y)2.48
Graham Number104.07
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 13.72% | ||
| ROE | 35.21% | ||
| ROCE | 26.64% | ||
| ROIC | 21.47% | ||
| ROICexc | 23.24% | ||
| ROICexgc | 79.55% | ||
| OM | 18.79% | ||
| PM (TTM) | 13.93% | ||
| GM | 36.42% | ||
| FCFM | 12.03% |
ROA(3y)10.97%
ROA(5y)9.1%
ROE(3y)30.74%
ROE(5y)25.66%
ROIC(3y)17.76%
ROIC(5y)15.01%
ROICexc(3y)19.7%
ROICexc(5y)17.25%
ROICexgc(3y)86.55%
ROICexgc(5y)79.73%
ROCE(3y)22.03%
ROCE(5y)18.62%
ROICexgc growth 3Y9.37%
ROICexgc growth 5Y29.75%
ROICexc growth 3Y15.09%
ROICexc growth 5Y17.85%
OM growth 3Y6.75%
OM growth 5Y6.01%
PM growth 3Y8.74%
PM growth 5Y3.71%
GM growth 3Y4.06%
GM growth 5Y2.99%
F-Score8
Asset Turnover0.98
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.47 | ||
| Debt/FCF | 1.82 | ||
| Debt/EBITDA | 0.9 | ||
| Cap/Depr | 105.39% | ||
| Cap/Sales | 1.91% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 67.67% | ||
| Profit Quality | 86.39% | ||
| Current Ratio | 1.2 | ||
| Quick Ratio | 0.84 | ||
| Altman-Z | 6.2 |
F-Score8
WACC7.34%
ROIC/WACC2.93
Cap/Depr(3y)91.41%
Cap/Depr(5y)79.68%
Cap/Sales(3y)1.8%
Cap/Sales(5y)1.63%
Profit Quality(3y)93.42%
Profit Quality(5y)105.39%
High Growth Momentum
Growth
EPS 1Y (TTM)18.92%
EPS 3Y22.59%
EPS 5Y11.99%
EPS Q2Q%15.13%
EPS Next Y19.57%
EPS Next 2Y16.76%
EPS Next 3Y15.53%
EPS Next 5Y10.27%
Revenue 1Y (TTM)8.58%
Revenue growth 3Y11.96%
Revenue growth 5Y8.69%
Sales Q2Q%5.54%
Revenue Next Year7.75%
Revenue Next 2Y7.71%
Revenue Next 3Y7.66%
Revenue Next 5Y7.2%
EBIT growth 1Y17.03%
EBIT growth 3Y19.52%
EBIT growth 5Y15.23%
EBIT Next Year24.93%
EBIT Next 3Y15.16%
EBIT Next 5Y8.89%
FCF growth 1Y32.68%
FCF growth 3Y26.67%
FCF growth 5Y10.75%
OCF growth 1Y32.52%
OCF growth 3Y25.58%
OCF growth 5Y10.38%
TRANE TECHNOLOGIES PLC / TT FAQ
What is the fundamental rating for TT stock?
ChartMill assigns a fundamental rating of 7 / 10 to TT.
Can you provide the valuation status for TRANE TECHNOLOGIES PLC?
ChartMill assigns a valuation rating of 2 / 10 to TRANE TECHNOLOGIES PLC (TT). This can be considered as Overvalued.
What is the profitability of TT stock?
TRANE TECHNOLOGIES PLC (TT) has a profitability rating of 9 / 10.
Can you provide the financial health for TT stock?
The financial health rating of TRANE TECHNOLOGIES PLC (TT) is 7 / 10.
What is the expected EPS growth for TRANE TECHNOLOGIES PLC (TT) stock?
The Earnings per Share (EPS) of TRANE TECHNOLOGIES PLC (TT) is expected to grow by 19.57% in the next year.