TORO CO (TTC) Stock Fundamental Analysis
NYSE:TTC - New York Stock Exchange, Inc. - US8910921084 - Common Stock - Currency: USD
Overall TTC gets a fundamental rating of 5 out of 10. We evaluated TTC against 128 industry peers in the Machinery industry. While TTC belongs to the best of the industry regarding profitability, there are some minor concerns on its financial health. TTC has a valuation in line with the averages, but on the other hand it scores bad on growth. Finally TTC also has an excellent dividend rating. This makes TTC very considerable for dividend investing!
1. Profitability
1.1 Basic Checks
In the past year TTC was profitable.
In the past year TTC had a positive cash flow from operations.
Each year in the past 5 years TTC has been profitable.
Each year in the past 5 years TTC had a positive operating cash flow.
1.2 Ratios
With an excellent Return On Assets value of 10.53%, TTC belongs to the best of the industry, outperforming 80.47% of the companies in the same industry.
Looking at the Return On Equity, with a value of 27.01%, TTC belongs to the top of the industry, outperforming 92.19% of the companies in the same industry.
TTC has a better Return On Invested Capital (15.50%) than 87.50% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for TTC is significantly above the industry average of 10.69%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 10.53% | ||
| ROE | 27.01% | ||
| ROIC | 15.5% |
ROA(3y)11.07%
ROA(5y)11.74%
ROE(3y)27.2%
ROE(5y)29.36%
ROIC(3y)17.81%
ROIC(5y)18.34%
1.3 Margins
TTC's Profit Margin of 8.77% is fine compared to the rest of the industry. TTC outperforms 65.63% of its industry peers.
TTC's Profit Margin has been stable in the last couple of years.
TTC has a Operating Margin (11.21%) which is in line with its industry peers.
TTC's Operating Margin has improved in the last couple of years.
TTC has a Gross Margin (33.53%) which is in line with its industry peers.
TTC's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 11.21% | ||
| PM (TTM) | 8.77% | ||
| GM | 33.53% |
OM growth 3Y-3.14%
OM growth 5Y2.35%
PM growth 3Y-4.07%
PM growth 5Y0.92%
GM growth 3Y0%
GM growth 5Y0.24%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so TTC is still creating some value.
The number of shares outstanding for TTC has been reduced compared to 1 year ago.
The number of shares outstanding for TTC has been reduced compared to 5 years ago.
The debt/assets ratio for TTC has been reduced compared to a year ago.
2.2 Solvency
TTC has an Altman-Z score of 4.19. This indicates that TTC is financially healthy and has little risk of bankruptcy at the moment.
TTC has a better Altman-Z score (4.19) than 69.53% of its industry peers.
TTC has a debt to FCF ratio of 2.41. This is a good value and a sign of high solvency as TTC would need 2.41 years to pay back of all of its debts.
With a decent Debt to FCF ratio value of 2.41, TTC is doing good in the industry, outperforming 70.31% of the companies in the same industry.
A Debt/Equity ratio of 0.73 indicates that TTC is somewhat dependend on debt financing.
Looking at the Debt to Equity ratio, with a value of 0.73, TTC is doing worse than 70.31% of the companies in the same industry.
Even though the debt/equity ratio score it not favorable for TTC, it has very limited outstanding debt, so we won't put too much weight on the DE evaluation.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.73 | ||
| Debt/FCF | 2.41 | ||
| Altman-Z | 4.19 |
ROIC/WACC1.53
WACC10.13%
2.3 Liquidity
A Current Ratio of 1.81 indicates that TTC should not have too much problems paying its short term obligations.
TTC's Current ratio of 1.81 is on the low side compared to the rest of the industry. TTC is outperformed by 60.16% of its industry peers.
A Quick Ratio of 0.79 indicates that TTC may have some problems paying its short term obligations.
TTC has a Quick ratio of 0.79. This is in the lower half of the industry: TTC underperforms 76.56% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.81 | ||
| Quick Ratio | 0.79 |
3. Growth
3.1 Past
TTC shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 13.51%, which is quite good.
Measured over the past 5 years, TTC shows a small growth in Earnings Per Share. The EPS has been growing by 6.88% on average per year.
The Revenue has been growing slightly by 2.94% in the past year.
Measured over the past years, TTC shows a small growth in Revenue. The Revenue has been growing by 7.87% on average per year.
EPS 1Y (TTM)13.51%
EPS 3Y4.83%
EPS 5Y6.88%
EPS Q2Q%1.43%
Revenue 1Y (TTM)2.94%
Revenue growth 3Y5%
Revenue growth 5Y7.87%
Sales Q2Q%-2.31%
3.2 Future
Based on estimates for the next years, TTC will show a small growth in Earnings Per Share. The EPS will grow by 4.15% on average per year.
The Revenue is expected to grow by 1.57% on average over the next years.
EPS Next Y4.23%
EPS Next 2Y6.68%
EPS Next 3Y7.24%
EPS Next 5Y4.15%
Revenue Next Year0.32%
Revenue Next 2Y1.42%
Revenue Next 3Y2.04%
Revenue Next 5Y1.57%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
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 16.04, the valuation of TTC can be described as correct.
Based on the Price/Earnings ratio, TTC is valued a bit cheaper than the industry average as 72.66% of the companies are valued more expensively.
TTC's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 26.31.
With a Price/Forward Earnings ratio of 14.19, TTC is valued correctly.
72.66% of the companies in the same industry are more expensive than TTC, based on the Price/Forward Earnings ratio.
TTC is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 22.13, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 16.04 | ||
| Fwd PE | 14.19 |
4.2 Price Multiples
62.50% of the companies in the same industry are more expensive than TTC, based on the Enterprise Value to EBITDA ratio.
TTC's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. TTC is cheaper than 75.00% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 14.79 | ||
| EV/EBITDA | 11.93 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates TTC does not grow enough to justify the current Price/Earnings ratio.
TTC has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)3.79
PEG (5Y)2.33
EPS Next 2Y6.68%
EPS Next 3Y7.24%
5. Dividend
5.1 Amount
TTC has a Yearly Dividend Yield of 2.18%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 1.91, TTC pays a better dividend. On top of this TTC pays more dividend than 85.94% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 2.40, TTC has a dividend comparable with the average S&P500 company.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.18% |
5.2 History
On average, the dividend of TTC grows each year by 9.97%, which is quite nice.
TTC has paid a dividend for at least 10 years, which is a reliable track record.
TTC has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)9.97%
Div Incr Years21
Div Non Decr Years34
5.3 Sustainability
37.79% of the earnings are spent on dividend by TTC. This is a low number and sustainable payout ratio.
TTC's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP37.79%
EPS Next 2Y6.68%
EPS Next 3Y7.24%
67.35
-2.4 (-3.44%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryMachinery
Earnings (Last)
Earnings (Next)
Inst Owners93.57%
Inst Owner Change-3.3%
Ins Owners0.37%
Ins Owner Change0.86%
Market Cap6.72B
Analysts72
Price Target91.55 (35.93%)
Short Float %3.64%
Short Ratio3.97
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.18% |
Yearly Dividend1.46
Dividend Growth(5Y)9.97%
DP37.79%
Div Incr Years21
Div Non Decr Years34
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)1.36%
Min EPS beat(2)0.57%
Max EPS beat(2)2.15%
EPS beat(4)2
Avg EPS beat(4)-0.85%
Min EPS beat(4)-4.45%
Max EPS beat(4)2.15%
EPS beat(8)4
Avg EPS beat(8)0.32%
EPS beat(12)8
Avg EPS beat(12)1.22%
EPS beat(16)11
Avg EPS beat(16)2.72%
Revenue beat(2)0
Avg Revenue beat(2)-2.75%
Min Revenue beat(2)-3.52%
Max Revenue beat(2)-1.97%
Revenue beat(4)0
Avg Revenue beat(4)-4.2%
Min Revenue beat(4)-9.05%
Max Revenue beat(4)-1.97%
Revenue beat(8)0
Avg Revenue beat(8)-3.89%
Revenue beat(12)0
Avg Revenue beat(12)-3.72%
Revenue beat(16)1
Avg Revenue beat(16)-3.18%
PT rev (1m)-1.59%
PT rev (3m)-3.84%
EPS NQ rev (1m)-1.7%
EPS NQ rev (3m)-0.75%
EPS NY rev (1m)0%
EPS NY rev (3m)-0.22%
Revenue NQ rev (1m)-0.43%
Revenue NQ rev (3m)-0.43%
Revenue NY rev (1m)0.04%
Revenue NY rev (3m)0.04%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 16.04 | ||
| Fwd PE | 14.19 | ||
| P/S | 1.48 | ||
| P/FCF | 14.79 | ||
| P/OCF | 12.05 | ||
| P/B | 4.55 | ||
| P/tB | 12.48 | ||
| EV/EBITDA | 11.93 |
EPS(TTM)4.2
EY6.24%
EPS(NY)4.75
Fwd EY7.05%
FCF(TTM)4.56
FCFY6.76%
OCF(TTM)5.59
OCFY8.3%
SpS45.54
BVpS14.79
TBVpS5.39
PEG (NY)3.79
PEG (5Y)2.33
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 10.53% | ||
| ROE | 27.01% | ||
| ROCE | 18.9% | ||
| ROIC | 15.5% | ||
| ROICexc | 16.58% | ||
| ROICexgc | 26.42% | ||
| OM | 11.21% | ||
| PM (TTM) | 8.77% | ||
| GM | 33.53% | ||
| FCFM | 10% |
ROA(3y)11.07%
ROA(5y)11.74%
ROE(3y)27.2%
ROE(5y)29.36%
ROIC(3y)17.81%
ROIC(5y)18.34%
ROICexc(3y)19.24%
ROICexc(5y)21.37%
ROICexgc(3y)34.38%
ROICexgc(5y)41.9%
ROCE(3y)21.71%
ROCE(5y)22.37%
ROICexcg growth 3Y-18.45%
ROICexcg growth 5Y-4.48%
ROICexc growth 3Y-11.36%
ROICexc growth 5Y-0.63%
OM growth 3Y-3.14%
OM growth 5Y2.35%
PM growth 3Y-4.07%
PM growth 5Y0.92%
GM growth 3Y0%
GM growth 5Y0.24%
F-Score6
Asset Turnover1.2
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.73 | ||
| Debt/FCF | 2.41 | ||
| Debt/EBITDA | 1.68 | ||
| Cap/Depr | 78.84% | ||
| Cap/Sales | 2.27% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 87.09% | ||
| Profit Quality | 114.02% | ||
| Current Ratio | 1.81 | ||
| Quick Ratio | 0.79 | ||
| Altman-Z | 4.19 |
F-Score6
WACC10.13%
ROIC/WACC1.53
Cap/Depr(3y)115.09%
Cap/Depr(5y)111.81%
Cap/Sales(3y)2.97%
Cap/Sales(5y)2.9%
Profit Quality(3y)63.97%
Profit Quality(5y)87.06%
High Growth Momentum
Growth
EPS 1Y (TTM)13.51%
EPS 3Y4.83%
EPS 5Y6.88%
EPS Q2Q%1.43%
EPS Next Y4.23%
EPS Next 2Y6.68%
EPS Next 3Y7.24%
EPS Next 5Y4.15%
Revenue 1Y (TTM)2.94%
Revenue growth 3Y5%
Revenue growth 5Y7.87%
Sales Q2Q%-2.31%
Revenue Next Year0.32%
Revenue Next 2Y1.42%
Revenue Next 3Y2.04%
Revenue Next 5Y1.57%
EBIT growth 1Y1.34%
EBIT growth 3Y1.7%
EBIT growth 5Y10.41%
EBIT Next Year27.91%
EBIT Next 3Y13.9%
EBIT Next 5YN/A
FCF growth 1Y246.74%
FCF growth 3Y3.15%
FCF growth 5Y13.75%
OCF growth 1Y76.58%
OCF growth 3Y0.86%
OCF growth 5Y11.05%