NYSE:CFX

Stock Analysis Report

Executive Summary

Colfax Corporation operates as a diversified technology company worldwide.

Rewards

Trading at 17.1% below its fair value

Earnings are forecast to grow 75.64% per year

Became profitable this year

Risk Analysis

Debt is not well covered by operating cash flow

Highly volatile share price over past 3 months

Large one-off items impacting financial results

Shareholders have been diluted in the past year



Snowflake Analysis

Fair value with moderate growth potential.


Similar Companies

Share Price & News

How has Colfax's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: CFX's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

3.1%

CFX

1.9%

US Machinery

2.0%

US Market


1 Year Return

59.4%

CFX

18.6%

US Machinery

23.5%

US Market

Return vs Industry: CFX exceeded the US Machinery industry which returned 22.4% over the past year.

Return vs Market: CFX exceeded the US Market which returned 24.7% over the past year.


Shareholder returns

CFXIndustryMarket
7 Day3.1%1.9%2.0%
30 Day8.1%1.5%4.3%
90 Day26.2%10.8%12.2%
1 Year59.4%59.4%20.8%18.6%26.1%23.5%
3 Year1.3%1.3%46.1%36.7%53.1%43.2%
5 Year-15.9%-15.9%78.2%56.6%75.5%56.1%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

Is Colfax undervalued compared to its fair value and its price relative to the market?

16.2%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: CFX ($37.5) is trading below our estimate of fair value ($45.23)

Significantly Below Fair Value: CFX is trading below fair value, but not by a significant amount.


Price To Earnings Ratio

PE vs Industry: CFX is poor value based on its PE Ratio (69.6x) compared to the Machinery industry average (23.4x).

PE vs Market: CFX is poor value based on its PE Ratio (69.6x) compared to the US market (18.9x).


Price to Earnings Growth Ratio

PEG Ratio: CFX is good value based on its PEG Ratio (0.9x)


Price to Book Ratio

PB vs Industry: CFX is good value based on its PB Ratio (1.5x) compared to the US Machinery industry average (2.5x).


Next Steps

Future Growth

How is Colfax forecast to perform in the next 1 to 3 years based on estimates from 14 analysts?

75.6%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: CFX's forecast earnings growth (75.6% per year) is above the savings rate (1.7%).

Earnings vs Market: CFX's earnings (75.6% per year) are forecast to grow faster than the US market (14.3% per year).

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

Revenue vs Market: CFX's revenue (1.7% per year) is forecast to grow slower than the US market (7.5% per year).

High Growth Revenue: CFX's revenue (1.7% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: CFX's Return on Equity is forecast to be low in 3 years time (5.8%).


Next Steps

Past Performance

How has Colfax performed over the past 5 years?

-38.8%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: CFX has a large one-off loss of $212.8M impacting its September 27 2019 financial results.

Growing Profit Margin: CFX became profitable in the past.


Past Earnings Growth Analysis

Earnings Trend: CFX's earnings have declined by -38.8% per year over the past 5 years.

Accelerating Growth: CFX has become profitable in the last year, making the earnings growth rate difficult to compare to its 5-year average.

Earnings vs Industry: CFX has become profitable in the last year, making it difficult to compare its past year earnings growth to the Machinery industry (9.6%).


Return on Equity

High ROE: CFX's Return on Equity (2.6%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Colfax's financial position?


Financial Position Analysis

Short Term Liabilities: CFX's short term assets ($3.5B) exceed its short term liabilities ($1.5B).

Long Term Liabilities: CFX's short term assets ($3.5B) do not cover its long term liabilities ($5.0B).


Debt to Equity History and Analysis

Debt Level: CFX's debt to equity ratio (128.7%) is considered high.

Reducing Debt: CFX's debt to equity ratio has increased from 47.5% to 128.7% over the past 5 years.

Debt Coverage: CFX's debt is not well covered by operating cash flow (4.7%).

Interest Coverage: CFX's interest payments on its debt are well covered by EBIT (4.3x coverage).


Balance Sheet

Inventory Level: CFX has a low level of unsold assets or inventory.

Debt Coverage by Assets: CFX's debt is not covered by short term assets (assets are 0.9x debt).


Next Steps

Dividend

What is Colfax's current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

companyn/amarketbottom25%1.4%markettop25%3.7%industryaverage1.9%forecastin3Years0%

Current dividend yield vs market & industry

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

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


Stability and Growth of Payments

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

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


Current Payout to Shareholders

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


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of CFX's dividend in 3 years as they are not forecast to pay a notable one for the US market.


Next Steps

Management

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

3.7yrs

Average management tenure


CEO

Matt Trerotola (52yo)

4.5yrs

Tenure

US$3,147,927

Compensation

Mr. Matthew L. Trerotola, also known as Matt, has been the Chief Executive Officer of Colfax Corporation since July 24, 2015 and has been its President since July 2015. Mr. Trerotola has been the President ...


CEO Compensation Analysis

Compensation vs Market: Matt's total compensation ($USD3.15M) is below average for companies of similar size in the US market ($USD4.99M).

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


Management Age and Tenure

3.7yrs

Average Tenure

57yo

Average Age

Experienced Management: CFX's management team is considered experienced (3.7 years average tenure).


Board Age and Tenure

10.1yrs

Average Tenure

59yo

Average Age

Experienced Board: CFX's board of directors are seasoned and experienced ( 10.1 years average tenure).


Insider Trading

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


Recent Insider Transactions

SellUS$160,76420 Nov 19
Daniel Pryor
EntityIndividual
Role
Senior Key Executive
Executive Vice President of Strategy & Business Development
Shares4,825
Max PriceUS$33.32
SellUS$38,44412 Nov 19
Jason MacLean
EntityIndividual
Role
Senior Key Executive
Senior Vice President of Colfax Business System & Supply Chain
Shares1,125
Max PriceUS$34.17
SellUS$147,86206 Nov 19
Shyam Kambeyanda
EntityIndividual
Role
Senior Key Executive
Senior Vice President
Shares4,100
Max PriceUS$36.06
SellUS$5,314,78101 Nov 19
Trott Family Foundation, Endowment Arm
EntityCompany
Shares165,312
Max PriceUS$32.15
SellUS$161,865,21901 Nov 19
BDT Capital Partners, LLC
EntityCompany
Shares5,034,688
Max PriceUS$32.15
SellUS$309,01716 May 19
Shyam Kambeyanda
EntityIndividual
Role
Senior Key Executive
Senior Vice President
Shares11,764
Max PriceUS$26.27
SellUS$115,05413 Mar 19
Ian Brander
EntityIndividual
Shares4,260
Max PriceUS$27.01
SellUS$70,64921 Feb 19
Lynn Clark
EntityIndividual
Shares2,666
Max PriceUS$26.50

Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 7.5%.


Management Team

  • Daniel Pryor (51yo)

    Executive Vice President of Strategy & Business Development

    • Tenure: 6.5yrs
    • Compensation: US$4.89m
  • Mitchell Rales (62yo)

    Co-Founder & Chairman of the Board

    • Compensation: US$1.00
  • Jason MacLean (50yo)

    Senior Vice President of Colfax Business System & Supply Chain

    • Tenure: 2.3yrs
  • Steve Breitzka (61yo)

    Interim Senior Vice President of Global Operations & Americas

    • Matt Trerotola (52yo)

      President

      • Tenure: 4.5yrs
      • Compensation: US$3.15m
    • Patty Lang (60yo)

      Senior VP & Chief Human Resources Officer

      • Tenure: 1yrs
    • Bradley Tandy (60yo)

      Senior VP & General Counsel

      • Tenure: 1yrs
    • Christopher Hix (57yo)

      Senior VP of Finance

      • Tenure: 3.5yrs
      • Compensation: US$3.24m
    • Shyam Kambeyanda (48yo)

      Senior Vice President

      • Tenure: 3.7yrs
      • Compensation: US$2.59m
    • Terry Ross

      Vice President of Investor Relations

      • Tenure: 5.1yrs

    Board Members

    • Sharon Wienbar (57yo)

      Independent Director

      • Tenure: 3.6yrs
      • Compensation: US$205.01k
    • Patrick Allender (72yo)

      Independent Director

      • Tenure: 11.7yrs
      • Compensation: US$220.01k
    • A. Perfall (60yo)

      Independent Director

      • Tenure: 9.3yrs
      • Compensation: US$225.01k
    • Mitchell Rales (62yo)

      Co-Founder & Chairman of the Board

      • Compensation: US$1.00
    • Tom Gayner (58yo)

      Independent Director

      • Tenure: 11.7yrs
      • Compensation: US$205.01k
    • Matt Trerotola (52yo)

      President

      • Tenure: 4.5yrs
      • Compensation: US$3.15m
    • Rajiv Vinnakota (47yo)

      Independent Director

      • Tenure: 11.7yrs
      • Compensation: US$205.01k
    • Didier P. Teirlinck (62yo)

      Independent Director

      • Tenure: 2.3yrs
      • Compensation: US$142.50k
    • Rhonda Jordan (61yo)

      Independent Director

      • Tenure: 10.9yrs
      • Compensation: US$220.01k
    • Liam Kelly (52yo)

      Director

      Company Information

      Colfax Corporation's company bio, employee growth, exchange listings and data sources


      Key Information

      • Name: Colfax Corporation
      • Ticker: CFX
      • Exchange: NYSE
      • Founded: 1860
      • Industry: Industrial Machinery
      • Sector: Capital Goods
      • Market Cap: US$4.483b
      • Shares outstanding: 117.76m
      • Website: https://www.colfaxcorp.com

      Number of Employees


      Location

      • Colfax Corporation
      • 420 National Business Parkway
      • 5th Floor
      • Annapolis Junction
      • Maryland
      • 20701
      • United States

      Listings

      TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
      CFXNYSE (New York Stock Exchange)YesCommon StockUSUSDMay 2008
      C52DB (Deutsche Boerse AG)YesCommon StockDEEURMay 2008
      0I1BLSE (London Stock Exchange)YesCommon StockGBUSDMay 2008

      Biography

      Colfax Corporation operates as a diversified technology company worldwide. The company operates through Air and Gas Handling, and Fabrication Technology segments. The Air and Gas Handling segment designs, manufactures, installs, and maintains heavy-duty fans, rotary heat exchangers, blowers, and compressors. It markets air and gas handling products under the Howden brand name. This segment sells its products and services directly, as well as through independent representatives and distributors to customers in the power generation, oil, gas and petrochemical, mining, wastewater, general industrial, and other markets. The Fabrication Technology segment formulates, develops, manufactures, and supplies consumable products and equipment for use in cutting, joining, and automated welding of steels, aluminum, and other metals and metal alloys. It also provides welding consumables comprising electrodes, cored and solid wires, and fluxes using a range of specialty and other materials; and cutting consumables, such as electrodes, nozzles, and shields and tips under the ESAB brand name. This segment sells its products through independent distributors and direct sales to the infrastructure, wind power, marine, pipelines, mobile/off-highway equipment, oil, gas, and mining markets. Colfax Corporation was founded in 1860 and is headquartered in Annapolis Junction, Maryland. 


      Company Analysis and Financial Data Status

      All financial data provided by Standard & Poor's Capital IQ.
      DataLast Updated (UTC time)
      Company Analysis2020/01/18 00:08
      End of Day Share Price2020/01/17 00:00
      Earnings2019/09/27
      Annual Earnings2018/12/31


      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.