Northwest Pipe (NasdaqGS:NWPX) - Share price, News & Analysis

Q: What is the Fair Price of NWPX when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

NWPX ($31.34) is trading below our estimate of [[fair value]] ($75.72)

NWPX fundamental analysis
Snowflake Score
Valuation	5/6
Future Growth	3/6
Past Performance	3/6
Financial Health	4/6
Dividends	0/6

NWPX Stock Overview

Northwest Pipe Company, together with its subsidiaries, manufactures and supplies water related infrastructure products in North America.

Rewards

Trading at 58.6% below our estimate of its fair value

Earnings are forecast to grow 29.05% per year

Earnings grew by 21.8% over the past year

Risk Analysis

No risks detected for NWPX from our risk checks.

Northwest Pipe Competitors

Concrete Pumping Holdings

NasdaqCM:BBCP

US$410.8m

Argan

NYSE:AGX

US$514.7m

ReneSola

NYSE:SOL

US$463.5m

IES Holdings

NasdaqGM:IESC

US$676.3m

Price History & Performance

Summary of all time highs, changes and price drops for Northwest Pipe
Historical stock prices
Current Share Price	US$31.34
52 Week High	US$34.94
52 Week Low	US$23.11
Beta	0.75
1 Month Change	7.59%
3 Month Change	5.49%
1 Year Change	15.01%
3 Year Change	23.29%
5 Year Change	89.60%
Change since IPO	213.40%

Recent News & Updates

Aug 08

Northwest Pipe Non-GAAP EPS of $1.04 beats by $0.31, revenue of $118.52M beats by $8.52M

Northwest Pipe press release (NASDAQ:NWPX): Q2 Non-GAAP EPS of $1.04 beats by $0.31. Revenue of $118.52M (+60.6% Y/Y) beats by $8.52M.

May 11

These 4 Measures Indicate That Northwest Pipe (NASDAQ:NWPX) Is Using Debt Reasonably Well

Some say volatility, rather than debt, is the best way to think about risk as an investor, but Warren Buffett famously...

Shareholder Returns

	NWPX	US Construction	US Market
7D	6.8%	3.8%	1.2%
1Y	15.0%	11.0%	-11.6%

Return vs Industry: NWPX exceeded the US Construction industry which returned 9.2% over the past year.

Return vs Market: NWPX exceeded the US Market which returned -13.5% over the past year.

Price Volatility

Is NWPX's price volatile compared to industry and market?
NWPX volatility
NWPX Average Weekly Movement	5.8%
Construction Industry Average Movement	6.1%
Market Average Movement	7.9%
10% most volatile stocks in US Market	17.0%
10% least volatile stocks in US Market	3.2%

Stable Share Price: NWPX is not significantly more volatile than the rest of US stocks over the past 3 months, typically moving +/- 6% a week.

Volatility Over Time: NWPX's weekly volatility (6%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
1966	1,256	Scott Montross	https://www.nwpipe.com

Northwest Pipe Company, together with its subsidiaries, manufactures and supplies water related infrastructure products in North America. It operates in two segments, Engineered Steel Pressure Pipe (SPP) and Precast Infrastructure and Engineered Systems (Precast). The SPP segment offers large-diameter, high-pressure steel pipeline systems for use in water infrastructure applications, which are primarily related to drinking water systems.

Northwest Pipe Fundamentals Summary

How do Northwest Pipe's earnings and revenue compare to its market cap?
NWPX fundamental statistics
Market Cap	US$311.12m
Earnings (TTM)	US$20.45m
Revenue (TTM)	US$415.04m

15.2x

P/E Ratio

0.7x

P/S Ratio

Is NWPX overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
NWPX income statement (TTM)
Revenue	US$415.04m
Cost of Revenue	US$350.24m
Gross Profit	US$64.81m
Other Expenses	US$44.36m
Earnings	US$20.45m

Last Reported Earnings

Jun 30, 2022

Next Earnings Date

n/a

Earnings per share (EPS)	2.06
Gross Margin	15.61%
Net Profit Margin	4.93%
Debt/Equity Ratio	30.4%

How did NWPX perform over the long term?

See historical performance and comparison

We’ve recently updated our valuation analysis.

Valuation

Is NWPX undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

5/6

Valuation Score 5/6

Price-To-Earnings vs Peers
Price-To-Earnings vs Industry
Price-To-Earnings vs Fair Ratio
Below Fair Value
Significantly Below Fair Value
Analyst Forecast

Key Valuation Metric

Which metric is best to use when looking at relative valuation for NWPX?

Other financial metrics that can be useful for relative valuation.

The above table shows the n/a ratio for NWPX. This is calculated by dividing NWPX's market cap by their current preferred multiple.
What is NWPX's n/a Ratio?
n/a Ratio	0x
n/a	n/a
Market Cap	US$311.12m

NWPX key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue	1.2x
Enterprise Value/EBITDA	13.4x
PEG Ratio	0.5x

Price to Earnings Ratio vs Peers

How does NWPX's PE Ratio compare to its peers?

NWPX PE Ratio vs Peers

The above table shows the PE ratio for NWPX vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	PE	Estimated Growth	Market Cap
Peer Average	42.2x
BBCP Concrete Pumping Holdings	30.9x	29.1%	US$410.8m
AGX Argan	14.7x	27.3%	US$514.7m
SOL ReneSola	105.3x	70.5%	US$463.5m
IESC IES Holdings	18x	n/a	US$676.3m
NWPX Northwest Pipe	15.2x	29.1%	US$311.1m

Price-To-Earnings vs Peers: NWPX is good value based on its Price-To-Earnings Ratio (15.2x) compared to the peer average (42.2x).

Price to Earnings Ratio vs Industry

How does NWPX's PE Ratio compare vs other companies in the US Construction Industry?

Price-To-Earnings vs Industry: NWPX is good value based on its Price-To-Earnings Ratio (15.2x) compared to the US Construction industry average (27.9x)

Price to Earnings Ratio vs Fair Ratio

What is NWPX's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

NWPX PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio	15.2x
Fair PE Ratio	20.6x

Price-To-Earnings vs Fair Ratio: NWPX is good value based on its Price-To-Earnings Ratio (15.2x) compared to the estimated Fair Price-To-Earnings Ratio (20.6x).

Share Price vs Fair Value

What is the Fair Price of NWPX when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: NWPX ($31.34) is trading below our estimate of fair value ($75.72)

Significantly Below Fair Value: NWPX is trading below fair value by more than 20%.

Analyst Price Targets

What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?

Analyst Forecast: Target price is more than 20% higher than the current share price, but there are not enough analysts covering the stock to determine statistical confidence in agreement.

Discover undervalued companies

Future Growth

How is Northwest Pipe forecast to perform in the next 1 to 3 years based on estimates from 2 analysts?

Future Growth Score

3/6

Future Growth Score 3/6

Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Future ROE

29.1%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: NWPX's forecast earnings growth (29.1% per year) is above the savings rate (1.9%).

Earnings vs Market: NWPX's earnings (29.1% per year) are forecast to grow faster than the US market (14.6% per year).

High Growth Earnings: NWPX's earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: NWPX's revenue (4.1% per year) is forecast to grow slower than the US market (7.9% per year).

High Growth Revenue: NWPX's revenue (4.1% per year) is forecast to grow slower than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: Insufficient data to determine if NWPX's Return on Equity is forecast to be high in 3 years time

Discover growth companies

Past Performance

How has Northwest Pipe performed over the past 5 years?

Past Performance Score

3/6

Past Performance Score 3/6

Quality Earnings
Growing Profit Margin
Earnings Trend
Accelerating Growth
Earnings vs Industry
High ROE

23.0%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: NWPX has high quality earnings.

Growing Profit Margin: NWPX's current net profit margins (4.9%) are lower than last year (5.7%).

Past Earnings Growth Analysis

Earnings Trend: NWPX's earnings have grown significantly by 23% per year over the past 5 years.

Accelerating Growth: NWPX's earnings growth over the past year (21.8%) is below its 5-year average (23% per year).

Earnings vs Industry: NWPX earnings growth over the past year (21.8%) exceeded the Construction industry 13.1%.

Return on Equity

High ROE: NWPX's Return on Equity (6.9%) is considered low.

Discover strong past performing companies

Financial Health

How is Northwest Pipe's financial position?

Financial Health Score

4/6

Financial Health Score 4/6

Short Term Liabilities
Long Term Liabilities
Debt Level
Reducing Debt
Debt Coverage
Interest Coverage

Financial Position Analysis

Short Term Liabilities: NWPX's short term assets ($269.8M) exceed its short term liabilities ($91.8M).

Long Term Liabilities: NWPX's short term assets ($269.8M) exceed its long term liabilities ($197.9M).

Debt to Equity History and Analysis

Debt Level: NWPX's net debt to equity ratio (29.3%) is considered satisfactory.

Reducing Debt: NWPX's debt to equity ratio has increased from 0.01% to 30.4% over the past 5 years.

Debt Coverage: NWPX's operating cash flow is negative, therefore debt is not well covered.

Interest Coverage: NWPX's interest payments on its debt are well covered by EBIT (15.9x coverage).

Balance Sheet

Discover healthy companies

Dividend

What is Northwest Pipe current dividend yield, its reliability and sustainability?

Dividend Score

0/6

Dividend Score 0/6

Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Cash Flow Coverage

Dividend Yield vs Market

Notable Dividend: Unable to evaluate NWPX's dividend yield against the bottom 25% of dividend payers, as the company has not reported any recent payouts.

High Dividend: Unable to evaluate NWPX's dividend yield against the top 25% of dividend payers, as the company has not reported any recent payouts.

Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if NWPX's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if NWPX's dividend payments have been increasing.

Earnings Payout to Shareholders

Earnings Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.

Cash Payout to Shareholders

Cash Flow Coverage: Unable to calculate sustainability of dividends as NWPX has not reported any payouts.

Discover strong dividend paying companies

Management

How experienced are the management team and are they aligned to shareholders interests?

2.9yrs

Average management tenure

CEO

Scott Montross (57 yo)

9.58yrs

Tenure

US$1,943,875

Compensation

Mr. Scott J. Montross has been the Chief Executive Officer and President of Northwest Pipe Company since January 1, 2013. Mr. Montross served as Chief Operating Officer and Executive Vice President at Nort...

CEO Compensation Analysis

Compensation vs Market: Scott's total compensation ($USD1.94M) is about average for companies of similar size in the US market ($USD2.68M).

Compensation vs Earnings: Scott's compensation has been consistent with company performance over the past year.

Leadership Team

Experienced Management: NWPX's management team is considered experienced (2.9 years average tenure).

Board Members

Experienced Board: NWPX's board of directors are considered experienced (7.8 years average tenure).

Ownership

Who are the major shareholders and have insiders been buying or selling?

Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.

Data	Last Updated (UTC time)
Company Analysis	2022/08/10 00:00
End of Day Share Price	2022/08/10 00:00
Earnings	2022/06/30
Annual Earnings	2021/12/31