The Toro Company
The Toro Company Fundamental Analysis
The Toro Company (TTC) shows moderate financial fundamentals with a PE ratio of 27.35, profit margin of 7.27%, and ROE of 23.00%. The company generates $4.5B in annual revenue with weak year-over-year growth of -1.60%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 61.6/100 based on profitability, valuation, growth, and balance sheet metrics. The C+ grade reflects average fundamentals, with notable risks in certain areas.
Fundamental Health Score
We analyze TTC's fundamental strength across five key dimensions:
Efficiency Score
WeakTTC struggles to generate sufficient returns from assets.
Valuation Score
WeakTTC trades at a premium to fair value.
Growth Score
WeakTTC faces weak or negative growth trends.
Financial Health Score
ExcellentTTC maintains a strong and stable balance sheet.
Profitability Score
ModerateTTC maintains healthy but balanced margins.
Key Financial Metrics
Is TTC Expensive or Cheap?
P/E Ratio
TTC trades at 27.35 times earnings. This indicates a fair valuation.
PEG Ratio
When adjusting for growth, TTC's PEG of 5.10 indicates potential overvaluation.
Price to Book
The market values The Toro Company at 6.38 times its book value. This suggests the stock is fully valued or overvalued on an asset basis.
EV/EBITDA
Enterprise value stands at 15.56 times EBITDA. This signals the market has high growth expectations.
How Well Does TTC Make Money?
Net Profit Margin
For every $100 in sales, The Toro Company keeps $7.27 as profit after all expenses.
Operating Margin
Core operations generate 9.27 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $23.00 in profit for every $100 of shareholder equity.
ROA
The Toro Company generates $8.95 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
The Toro Company produces operating cash flow of $732.80M, showing steady but balanced cash generation.
Free Cash Flow
The Toro Company generates strong free cash flow of $657.10M, providing ample flexibility for dividends, buybacks, or growth.
FCF Per Share
Each share generates $6.74 in free cash annually.
FCF Yield
TTC converts 7.37% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
27.35
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
5.10
vs 25 benchmark
P/B Ratio
Price to book value ratio
6.38
vs 25 benchmark
P/S Ratio
Price to sales ratio
1.98
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
0.08
vs 25 benchmark
Current Ratio
Current assets to current liabilities
1.69
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.23
vs 25 benchmark
ROA
Return on assets percentage
0.09
vs 25 benchmark
ROCE
Return on capital employed
0.16
vs 25 benchmark
How TTC Stacks Against Its Sector Peers
| Metric | TTC Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 27.35 | 25.24 | Neutral |
| ROE | 23.00% | 1281.00% | Weak |
| Net Margin | 7.27% | -44434.00% (disorted) | Weak |
| Debt/Equity | 0.08 | 0.75 | Strong (Low Leverage) |
| Current Ratio | 1.69 | 10.59 | Neutral |
| ROA | 8.95% | -1528290.00% (disorted) | Weak |
TTC outperforms its industry in 1 out of 6 key metrics, but lagging in ROE.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews The Toro Company's 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
44.44%
Industry Style: Cyclical, Value, Infrastructure
High GrowthEPS CAGR
3.74%
Industry Style: Cyclical, Value, Infrastructure
GrowingFCF CAGR
32.80%
Industry Style: Cyclical, Value, Infrastructure
High Growth