Tower Limited
Tower Limited Fundamental Analysis
Tower Limited (TWR.AX) shows strong financial fundamentals with a PE ratio of 6.80, profit margin of 13.64%, and ROE of 24.11%. The company generates $0.7B in annual revenue with strong year-over-year growth of 19.70%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 79.4/100 based on profitability, valuation, growth, and balance sheet metrics. The B grade reflects solid fundamentals with room for improvement in valuation or growth.
Fundamental Health Score
We analyze TWR.AX's fundamental strength across five key dimensions:
Efficiency Score
ExcellentTWR.AX demonstrates superior asset utilization.
Valuation Score
ExcellentTWR.AX trades at attractive valuation levels.
Growth Score
ExcellentTWR.AX delivers strong and consistent growth momentum.
Financial Health Score
ExcellentTWR.AX maintains a strong and stable balance sheet.
Profitability Score
ModerateTWR.AX maintains healthy but balanced margins.
Key Financial Metrics
Is TWR.AX Expensive or Cheap?
P/E Ratio
TWR.AX trades at 6.80 times earnings. This suggests potential undervaluation.
PEG Ratio
When adjusting for growth, TWR.AX's PEG of -0.76 indicates potential undervaluation.
Price to Book
The market values Tower Limited at 1.62 times its book value. This may indicate undervaluation.
EV/EBITDA
Enterprise value stands at 14.61 times EBITDA. This signals the market has high growth expectations.
How Well Does TWR.AX Make Money?
Net Profit Margin
For every $100 in sales, Tower Limited keeps $13.64 as profit after all expenses.
Operating Margin
Core operations generate 57.72 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $24.11 in profit for every $100 of shareholder equity.
ROA
Tower Limited generates $13.65 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Tower Limited produces operating cash flow of $163.25M, showing steady but balanced cash generation.
Free Cash Flow
Tower Limited generates strong free cash flow of $161.92M, providing ample flexibility for dividends, buybacks, or growth.
FCF Per Share
Each share generates $0.47 in free cash annually.
FCF Yield
TWR.AX converts 21.87% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
6.80
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
-0.76
vs 25 benchmark
P/B Ratio
Price to book value ratio
1.62
vs 25 benchmark
P/S Ratio
Price to sales ratio
1.06
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
0.07
vs 25 benchmark
Current Ratio
Current assets to current liabilities
1.89
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.24
vs 25 benchmark
ROA
Return on assets percentage
0.14
vs 25 benchmark
ROCE
Return on capital employed
0.64
vs 25 benchmark
How TWR.AX Stacks Against Its Sector Peers
| Metric | TWR.AX Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 6.80 | 18.66 | Better (Cheaper) |
| ROE | 24.11% | 806.00% | Weak |
| Net Margin | 13.64% | -451.00% (disorted) | Strong |
| Debt/Equity | 0.07 | 1.00 | Strong (Low Leverage) |
| Current Ratio | 1.89 | 662.02 | Neutral |
| ROA | 13.65% | -24409.00% (disorted) | Strong |
TWR.AX outperforms its industry in 4 out of 6 key metrics, particularly excelling in Net Margin, but lagging in ROE.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Tower Limited's 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
50.18%
Industry Style: Value, Dividend, Cyclical
High GrowthEPS CAGR
314.13%
Industry Style: Value, Dividend, Cyclical
High GrowthFCF CAGR
444.77%
Industry Style: Value, Dividend, Cyclical
High Growth