NYSE:AIT

Stock Analysis Report

Applied Industrial Technologies

Executive Summary

Applied Industrial Technologies, Inc. distributes industrial products in North America, Australia, New Zealand, and Singapore.

Snowflake

Fundamentals

Established dividend payer and fair value.


Similar Companies

Share Price & News

How has Applied Industrial Technologies's share price performed over time and what events caused price changes?


Latest Share Price and Events


Market Performance


7 Day Return

0.6%

AIT

2.2%

US Trade Distributors

0.4%

US Market


1 Year Return

-20.1%

AIT

8.4%

US Trade Distributors

6.9%

US Market

Return vs Industry: AIT underperformed the US Trade Distributors industry which returned 8.4% over the past year.

Return vs Market: AIT underperformed the US Market which returned 6.9% over the past year.


Shareholder returns

AITIndustryMarket
7 Day0.6%2.2%0.4%
30 Day1.6%2.9%-1.1%
90 Day-2.7%8.5%-0.5%
1 Year-18.4%-20.1%10.4%8.4%9.3%6.9%
3 Year31.8%24.3%45.0%38.9%45.8%36.4%
5 Year33.0%19.2%31.3%21.9%62.9%45.1%

Price Volatility Vs. Market

How volatile is Applied Industrial Technologies's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Applied Industrial Technologies undervalued compared to its fair value and its price relative to the market?

18.4%

Undervalued compared to fair value


Share Price vs. Fair Value

Undervalued: AIT ($55.72) is trading below our estimate of fair value ($68.32)

Significantly Undervalued: AIT is trading below fair value, but not by a significant amount.


Price To Earnings Ratio

PE vs Industry: AIT is good value based on its PE Ratio (15x) compared to the Trade Distributors industry average (16.7x).

PE vs Market: AIT is good value based on its PE Ratio (15x) compared to the US market (17.6x).


Price to Earnings Growth Ratio

Low PEG Ratio: AIT is poor value based on its PEG Ratio (1.3x)


Price to Book Ratio

PB vs Industry: AIT is overvalued based on its PB Ratio (2.4x) compared to the US Trade Distributors industry average (1.4x).


Next Steps

Future Growth

How is Applied Industrial Technologies forecast to perform in the next 1 to 3 years based on estimates from 6 analysts?

11.3%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: AIT's forecast earnings growth (11.3% per year) is above the savings rate (2.7%).

Earnings vs Market: AIT's earnings (11.3% per year) are forecast to grow slower than the US market (14.6% per year).

High Growth Earnings: AIT's earnings are forecast to grow, but not significantly.

Revenue vs Market: AIT's revenue (2.2% per year) is forecast to grow slower than the US market (7.2% per year).

High Growth Revenue: AIT's revenue (2.2% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

High Future ROE: AIT's Return on Equity is forecast to be low in 3 years time (16.3%).


Next Steps

Past Performance

How has Applied Industrial Technologies performed over the past 5 years?

11.0%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

Earnings Trend: AIT's earnings have grown by 11% per year over the past 5 years.

Accelerating Growth: AIT's earnings growth over the past year (1.7%) is below its 5-year average (11% per year).

Earnings vs Industry: AIT earnings growth over the past year (1.7%) exceeded the Trade Distributors industry 0.9%.


Return on Equity

High ROE: AIT's Return on Equity (16.1%) is considered low.


Return on Assets

ROA vs Industry: AIT has a higher Return on Assets than the Trade Distributors industry average last year.


Return on Capital Employed

ROCE Improving: AIT's Return on Capital Employed has declined over the past 3 years.


Next Steps

Financial Health

How is Applied Industrial Technologies's financial position?


Financial Position Analysis

Short Term Liabilities: AIT's short term assets ($1.1B) exceeds its short term liabilities ($423.8M)

Long Term Liabilities: AIT's short term assets (1.1B) exceeds its long term liabilities (1.0B)


Debt to Equity History and Analysis

Debt Level: AIT's debt to equity ratio (106.8%) is considered high

Reducing Debt: AIT's debt to equity ratio has increased from 21.5% to 106.8% over the past 5 years.

Debt Coverage: AIT's debt is not well covered by operating cash flow (18.9%).

Interest Coverage: AIT's interest payments on its debt are well covered by EBIT (6.7x coverage).


Balance Sheet

Inventory Level: AIT has a high level of physical assets or inventory.

Debt Coverage by Assets: AIT's debt is covered by short term assets (assets are 1.198610x debt).


Next Steps

Dividend

What is Applied Industrial Technologies's current dividend yield, its reliability and sustainability?

2.23%

Current Dividend Yield


Dividend Yield vs Market

company2.2%marketbottom25%1.4%markettop25%3.7%industryaverage2.7%forecastin3Years2.3%

Current dividend yield vs market & industry


Stability and Growth of Payments

Notable Dividend: AIT's dividend (2.23%) is higher than the bottom 25% of dividend payers in the US market (1.45%).

High Dividend: AIT's dividend (2.23%) is low compared to the top 25% of dividend payers in the US market (3.73%).

Stable Dividend: AIT's dividends per share have been stable in the past 10 years.

Growing Dividend: AIT's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (32.8%), AIT's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: AIT's dividends in 3 years are forecast to be well covered by earnings (27.4% payout ratio).


Next Steps

Management

What is the CEO of Applied Industrial Technologies's salary, the management and board of directors tenure and is there insider trading?

5.3yrs

Average management tenure


CEO

Neil Schrimsher (55yo)

8yrs

Tenure

US$4,493,377

Compensation

Mr. Neil A. Schrimsher has been the Chief Executive Officer of Applied Industrial Technologies, Inc. since October 25, 2011 and its President since August 2013. Mr. Schrimsher's managerial experience inclu ...


CEO Compensation Analysis

Compensation vs. Market: Neil's total compensation ($USD4.49M) is about average for companies of similar size in the US market ($USD4.00M).

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


Management Age and Tenure

5.3yrs

Average Tenure

54yo

Average Age

Experienced Management: AIT's management team is seasoned and experienced (5.3 years average tenure).


Board Age and Tenure

7.3yrs

Average Tenure

61yo

Average Age

Experienced Board: AIT's board of directors are considered experienced (7.3 years average tenure).


Insider Trading

Insider Buying: AIT insiders have only sold shares in the past 3 months.


Recent Insider Transactions

SellUS$856,81830 Aug 19
Jerry Thornton
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares16,031
Max PriceUS$53.45
SellUS$464,46915 Nov 18
Edith Kelly-Green
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares7,090
Max PriceUS$65.82

Ownership Breakdown


Management Team

  • Fred Bauer (53yo)

    VP, General Counsel & Secretary

    • Tenure: 17.5yrs
    • Compensation: US$1.23m
  • Bud Hoffner (59yo)

    VP and GM of Fluid Power & Flow Control

    • Tenure: 16.3yrs
    • Compensation: US$912.89k
  • Neil Schrimsher (55yo)

    President

    • Tenure: 8yrs
    • Compensation: US$4.49m
  • Ryan Cieslak

    Director of Investor Relations & Assistant Treasurer

    • Tenure: 0.6yrs
  • Dave Wells (57yo)

    VP, CFO & Treasurer

    • Tenure: 2.2yrs
    • Compensation: US$1.15m
  • Chris Macey (46yo)

    Corporate Controller & Principal Accounting Officer

    • Tenure: 4.1yrs
  • Kurt Loring (50yo)

    VP & Chief Human Resource Officer

    • Tenure: 5.3yrs
    • Compensation: US$926.62k
  • Julie Kho

    Manager of Corporate Communications & Media Relations

    • Tenure: 0yrs

Board Members

  • Pete Wallace (65yo)

    Independent Chairman

    • Tenure: 5yrs
    • Compensation: US$280.03k
  • Peter Dorsman (63yo)

    Independent Director

    • Tenure: 17.3yrs
    • Compensation: US$219.49k
  • Jerry Thornton (72yo)

    Independent Director

    • Tenure: 25.8yrs
    • Compensation: US$205.74k
  • Dan Komnenovich (67yo)

    Independent Director

    • Tenure: 7.3yrs
    • Compensation: US$205.74k
  • Edith Kelly-Green (66yo)

    Independent Director

    • Tenure: 17.3yrs
    • Compensation: US$216.99k
  • Vince Petrella (59yo)

    Independent Director

    • Tenure: 7.3yrs
    • Compensation: US$224.49k
  • Bob Pagano (56yo)

    Independent Director

    • Tenure: 2.2yrs
    • Compensation: US$205.74k
  • Joe Raver (53yo)

    Independent Director

    • Tenure: 2.2yrs
    • Compensation: US$205.74k
  • Neil Schrimsher (55yo)

    President

    • Tenure: 8yrs
    • Compensation: US$4.49m
  • Madhuri Andrews (52yo)

    Independent Director

    • Tenure: 0.2yrs

Company Information

Applied Industrial Technologies, Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Applied Industrial Technologies, Inc.
  • Ticker: AIT
  • Exchange: NYSE
  • Founded: 1923
  • Industry: Trading Companies and Distributors
  • Sector: Capital Goods
  • Market Cap: US$2.154b
  • Shares outstanding: 38.65m
  • Website: https://www.applied.com

Number of Employees


Location

  • Applied Industrial Technologies, Inc.
  • 1 Applied Plaza
  • Cleveland
  • Ohio
  • 44115
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
AITNYSE (New York Stock Exchange)YesCommon StockUSUSDJan 1968
AT4DB (Deutsche Boerse AG)YesCommon StockDEEURJan 1968
0HGRLSE (London Stock Exchange)YesCommon StockGBUSDJan 1968

Biography

Applied Industrial Technologies, Inc. distributes industrial products in North America, Australia, New Zealand, and Singapore. The company offers its products for maintenance, repair, and operational, as w ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/10/19 23:31
End of Day Share Price2019/10/18 00:00
Earnings2019/06/30
Annual Earnings2019/06/30


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.