| Snowflake Score | |
|---|---|
| Valuation | 5/6 |
| Future Growth | 0/6 |
| Past Performance | 6/6 |
| Financial Health | 6/6 |
| Dividends | 5/6 |
SNA Stock Overview
Snap-on Incorporated manufactures and markets tools, equipment, diagnostics, and repair information and systems solutions for professional users worldwide.
Snap-on Competitors
Price History & Performance
| Historical stock prices | |
|---|---|
| Current Share Price | US$202.76 |
| 52 Week High | US$235.36 |
| 52 Week Low | US$190.08 |
| Beta | 1.11 |
| 1 Month Change | -7.10% |
| 3 Month Change | 2.28% |
| 1 Year Change | -2.96% |
| 3 Year Change | 33.30% |
| 5 Year Change | 36.46% |
| Change since IPO | 821.64% |
Recent News & Updates
Why Snap-on Is A Good Dividend Growth Pick For The Current Market
Summary Snap-on consistently grows its revenue and improves its profitability. Tailwinds in the vehicle repair market should help the company. Management continues to report very high demand levels. The business has impressive margins and a very solid balance sheet. The company generates strong free cash flow and pays out a fast growing dividend. I believe that the risk to reward is favorable and that the current pullback is a decent entry point. Investment Thesis Snap-on (SNA) is a consistent compounder. The company steadily grows its revenue and improves its profitability. It pays out a reliable dividend that compounds at a high rate. I also believe that tailwinds in the vehicle repair market reduce the risk of this investment. The company has high demand and a very conservative balance sheet. The company has modest long-term revenue growth. It is a somewhat unambitious investment. But I think that the risk to reward is favorable. This may be a good addition to a defensive dividend growth portfolio. A Steady Growth Outlook Snap-on is a steady growth story. The company has increased its EBIT at a 9% CAGR over the past ten years. This isn’t an extremely high growth rate, but the business’s consistency is impressive. The company is most exposed to the automotive market. The business calls its vehicle service and repair tools segment the Snap-on Tools Group. It generates 46% of Snap-on’s revenue and over half of its operating profit. The segment reported 9.3% organic growth year over year and it is up 28% over 2019 levels. This is strong growth, and I believe it’s likely to continue. Snap-on Q2 Quarterly Financial Review I believe that the fundamentals for the auto repair market are strong. Ongoing chip shortages continue to drag on new car supplies. These shortages will likely continue through 2023. At the same time, prices of used cars are soaring. One of the greatest risks to the company is a decline in the vehicle repair market. But I think that there are long-term tailwinds to this market. Cars are usually a nondiscretionary expense. Consumers looking to save will usually choose to repair an existing car before buying a new one. At the same time, the average age of US cars is increasing. For these reasons, I believe that this segment will be more resilient if consumer spending pulls back. Snap-on's other segments also have high exposure to the professional and industrial markets. This should make the company more resistant to consumer spending headwinds. The business’s customers include government, aerospace, transportation, and vehicle repair. The company’s top line has been cyclical in the past, but I believe that there is a smaller risk of downside right now. High Demand And Solid Profitability Snap-on’s profitability is also promising. The company reports consistent gross margins above 50%. It has a solid EBIT margin of 28%, up almost 10 percentage points over the past decade. This is strong compared to a lot of other tool companies. I will point out how Snap-on sells its products through its franchised mobile van channel. This model guarantees the business an ongoing fee. It also reduces some risks related to expansion. This boosts Snap-on’s margins and adds flexibility to its cost structure. Snap-on Q2 Quarterly Financial Review The company’s financial services segment has also helped boost profitability. This segment finances the purchases and leases of the business’s products. It has grown at a five-year CAGR of 35% and generates high margins. I like how management has found ways to further boost its profit. I'm impressed that Snap-on has maintained these margins even as industry headwinds increase. Commodity inflation has been a major issue for many industrial companies. But Snap-on has held its gross margins and reduced its operating expenditures year over year. On their last earnings call, management was asked about the balance between volume and price increases. Looking at our factories, we know we have products in demand. There is rolling off there and our guys are up to their eyeballs in demand. So we know that’s a positive situation. The other thing is it’s hard, because you know we have list prices. But the list prices don’t -- are very from product to product and they come out on an average, you might say your raising sales 3.5% or something like that but products... So it’s hard for us to say. I would say the minority of the increases in pricing and the majority is in volume for us. We think that’s the situation in this situation in our environment. Now, that varies from Group to Group and so on. The positive demand outlook should also reduce the risk of product liquidations. Across consumer markets, companies are having to liquidate excess inventory. This hurts gross margins and can significantly reduce profitability. But Snap-on is reporting that its inventory turns are above prepandemic levels. This further reduces the risk of a severe drawdown. Good Returns At A Reasonable Valuation Snap-on is trading at a reasonable valuation. The company has a forward P/E of 12.5 times and a forward EV/EBITDA of 9 times. It is effective at reinvesting its capital, generating an ROIC of 13.5%. The business has a very conservative balance sheet with no nonoperating debt.
Many Would Be Envious Of Snap-on's (NYSE:SNA) Excellent Returns On Capital
To find a multi-bagger stock, what are the underlying trends we should look for in a business? Ideally, a business will...
Snap-on a new best idea short at Hedgeye
Snap-on (NYSE:SNA) was added as a new best idea short at Hedgeye with potential for 40% downside for its shares. Snap-on's business distribution, financing, and incentive structures appear to be adding" significant cyclicality" to an "already exaggerated" auto servicing upswing, Hedgeye analyst Jay Van Sciver wrote in a note on Sunday. "The slowing of market growth should have significant follow-on effects for Snap-On, with its thousands of financed franchisees who in turn sell to leveraged customers," Van Sciver wrote in the note. Van Sciver also sees Snap-On (SNA) potentially hurt by the "electric vehicle narrative" as investors may worry that the long-term prospects for SNA shares may be "substantial." Hedgeye is hosting a presentation on the SNA short idea on Wednesday. Snap-on (SNA) short interest is 5.9%. Snap-on (SNA) last month reported Q2 GAAP EPS of $4.27 beat by $0.30, revenue of $1.14B, beat by $40M.
Shareholder Returns
| SNA | US Machinery | US Market | |
|---|---|---|---|
| 7D | -3.9% | -2.1% | -3.1% |
| 1Y | -3.0% | -16.4% | -21.5% |
Return vs Industry: SNA exceeded the US Machinery industry which returned -17.4% over the past year.
Return vs Market: SNA exceeded the US Market which returned -20.3% over the past year.
Price Volatility
| SNA volatility | |
|---|---|
| SNA Average Weekly Movement | 3.2% |
| Machinery Industry Average Movement | 5.3% |
| Market Average Movement | 6.9% |
| 10% most volatile stocks in US Market | 15.7% |
| 10% least volatile stocks in US Market | 2.8% |
Stable Share Price: SNA is less volatile than 75% of US stocks over the past 3 months, typically moving +/- 3% a week.
Volatility Over Time: SNA's weekly volatility (3%) has been stable over the past year.
About the Company
| Founded | Employees | CEO | Website |
|---|---|---|---|
| 1920 | 12,800 | Nicholas Pinchuk | https://www.snapon.com |
Snap-on Incorporated manufactures and markets tools, equipment, diagnostics, and repair information and systems solutions for professional users worldwide. It operates through Commercial & Industrial Group, Snap-on Tools Group, Repair Systems & Information Group, and Financial Services segments. The company offers hand tools, including wrenches, sockets, ratchet wrenches, pliers, screwdrivers, punches and chisels, saws and cutting tools, pruning tools, torque measuring instruments, and other products; power tools, such as cordless, pneumatic, hydraulic, and corded tools; and tool storage products comprising tool chests, roll cabinets, and other products.
Snap-on Fundamentals Summary
| SNA fundamental statistics | |
|---|---|
| Market Cap | US$10.80b |
| Earnings (TTM) | US$868.80m |
| Revenue (TTM) | US$4.73b |
12.4x
P/E Ratio2.3x
P/S RatioIs SNA overvalued?
See Fair Value and valuation analysisEarnings & Revenue
| SNA income statement (TTM) | |
|---|---|
| Revenue | US$4.73b |
| Cost of Revenue | US$2.24b |
| Gross Profit | US$2.42b |
| Other Expenses | US$1.55b |
| Earnings | US$868.80m |
Last Reported Earnings
Jul 02, 2022
Next Earnings Date
n/a
| Earnings per share (EPS) | 16.31 |
| Gross Margin | 51.08% |
| Net Profit Margin | 18.37% |
| Debt/Equity Ratio | 27.7% |
How did SNA perform over the long term?
See historical performance and comparisonDividends
2.8%
Current Dividend Yield34%
Payout RatioValuation
Is SNA undervalued compared to its fair value, analyst forecasts and its price relative to the market?
Valuation Score
5/6Valuation 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 SNA?
Other financial metrics that can be useful for relative valuation.
| What is SNA's n/a Ratio? | |
|---|---|
| n/a Ratio | 0x |
| n/a | n/a |
| Market Cap | US$10.80b |
| Key Statistics | |
|---|---|
| Enterprise Value/Revenue | 2.4x |
| Enterprise Value/EBITDA | 8.7x |
| PEG Ratio | -31x |
Price to Earnings Ratio vs Peers
How does SNA's PE Ratio compare to its peers?
| SNA PE Ratio vs Peers |
|---|
| Company | PE | Estimated Growth | Market Cap |
|---|---|---|---|
| Peer Average | 22.5x | ||
SWK Stanley Black & Decker | 12.1x | 30.6% | US$11.4b |
GGG Graco | 23x | 7.8% | US$10.2b |
NDSN Nordson | 25.4x | 10.3% | US$12.2b |
IEX IDEX | 29.5x | 13.1% | US$15.1b |
SNA Snap-on | 12.4x | -0.4% | US$10.8b |
Price-To-Earnings vs Peers: SNA is good value based on its Price-To-Earnings Ratio (12.4x) compared to the peer average (22.5x).
Price to Earnings Ratio vs Industry
How does SNA's PE Ratio compare vs other companies in the US Machinery Industry?
Price-To-Earnings vs Industry: SNA is good value based on its Price-To-Earnings Ratio (12.4x) compared to the US Machinery industry average (18.8x)
Price to Earnings Ratio vs Fair Ratio
What is SNA'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.
| Fair Ratio | |
|---|---|
| Current PE Ratio | 12.4x |
| Fair PE Ratio | 16.2x |
Price-To-Earnings vs Fair Ratio: SNA is good value based on its Price-To-Earnings Ratio (12.4x) compared to the estimated Fair Price-To-Earnings Ratio (16.2x).
Share Price vs Fair Value
What is the Fair Price of SNA when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.
Below Fair Value: SNA ($202.76) is trading below our estimate of fair value ($370.73)
Significantly Below Fair Value: SNA 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 less than 20% higher than the current share price.
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Future Growth
How is Snap-on forecast to perform in the next 1 to 3 years based on estimates from 9 analysts?
Future Growth Score
0/6Future Growth Score 0/6
Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Future ROE
-0.4%
Forecasted annual earnings growth
Earnings and Revenue Growth Forecasts
Analyst Future Growth Forecasts
Earnings vs Savings Rate: SNA's earnings are forecast to decline over the next 3 years (-0.4% per year).
Earnings vs Market: SNA's earnings are forecast to decline over the next 3 years (-0.4% per year).
High Growth Earnings: SNA's earnings are forecast to decline over the next 3 years.
Revenue vs Market: SNA's revenue (2.4% per year) is forecast to grow slower than the US market (7.7% per year).
High Growth Revenue: SNA's revenue (2.4% per year) is forecast to grow slower than 20% per year.
Earnings per Share Growth Forecasts
Future Return on Equity
Future ROE: SNA's Return on Equity is forecast to be low in 3 years time (18.6%).
Discover growth companies
Past Performance
How has Snap-on performed over the past 5 years?
Past Performance Score
6/6Past Performance Score 6/6
Quality Earnings
Growing Profit Margin
Earnings Trend
Accelerating Growth
Earnings vs Industry
High ROE
7.4%
Historical annual earnings growth
Earnings and Revenue History
Quality Earnings: SNA has high quality earnings.
Growing Profit Margin: SNA's current net profit margins (18.4%) are higher than last year (17.6%).
Past Earnings Growth Analysis
Earnings Trend: SNA's earnings have grown by 7.4% per year over the past 5 years.
Accelerating Growth: SNA's earnings growth over the past year (10.3%) exceeds its 5-year average (7.4% per year).
Earnings vs Industry: SNA earnings growth over the past year (10.3%) exceeded the Machinery industry 9.4%.
Return on Equity
High ROE: SNA's Return on Equity (20.5%) is considered high.
Discover strong past performing companies
Financial Health
How is Snap-on's financial position?
Financial Health Score
6/6Financial Health Score 6/6
Short Term Liabilities
Long Term Liabilities
Debt Level
Reducing Debt
Debt Coverage
Interest Coverage
Financial Position Analysis
Short Term Liabilities: SNA's short term assets ($3.2B) exceed its short term liabilities ($986.1M).
Long Term Liabilities: SNA's short term assets ($3.2B) exceed its long term liabilities ($1.5B).
Debt to Equity History and Analysis
Debt Level: SNA's net debt to equity ratio (9%) is considered satisfactory.
Reducing Debt: SNA's debt to equity ratio has reduced from 38.5% to 27.7% over the past 5 years.
Debt Coverage: SNA's debt is well covered by operating cash flow (61.9%).
Interest Coverage: SNA's interest payments on its debt are well covered by EBIT (27.1x coverage).
Balance Sheet
Discover healthy companies
Dividend
What is Snap-on current dividend yield, its reliability and sustainability?
Dividend Score
5/6Dividend Score 5/6
Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Cash Flow Coverage
2.80%
Current Dividend Yield
Dividend Yield vs Market
| Snap-on Dividend Yield vs Market |
|---|
| Segment | Dividend Yield |
|---|---|
| Company (Snap-on) | 2.8% |
| Market Bottom 25% (US) | 1.7% |
| Market Top 25% (US) | 4.7% |
| Industry Average (Machinery) | 2.0% |
| Analyst forecast in 3 Years (Snap-on) | 3.2% |
Notable Dividend: SNA's dividend (2.8%) is higher than the bottom 25% of dividend payers in the US market (1.64%).
High Dividend: SNA's dividend (2.8%) is low compared to the top 25% of dividend payers in the US market (4.61%).
Stability and Growth of Payments
Stable Dividend: SNA's dividends per share have been stable in the past 10 years.
Growing Dividend: SNA's dividend payments have increased over the past 10 years.
Earnings Payout to Shareholders
Earnings Coverage: With its reasonably low payout ratio (33.8%), SNA's dividend payments are well covered by earnings.
Cash Payout to Shareholders
Cash Flow Coverage: With its reasonably low cash payout ratio (45.2%), SNA's dividend payments are well covered by cash flows.
Discover strong dividend paying companies
Management
How experienced are the management team and are they aligned to shareholders interests?
5.3yrs
Average management tenure
CEO
Nicholas Pinchuk (75 yo)
15.42yrs
Tenure
US$9,872,946
Compensation
Mr. Nicholas T. Pinchuk has been the Chief Executive Officer at Snap-on Incorporated since December 2007 and serves as its President since April 2007. Mr. Pinchuk served as the President of Worldwide Comme...
CEO Compensation Analysis
| Nicholas Pinchuk's Compensation vs Snap-on Earnings |
|---|
| Date | Total Comp. | Salary | Company Earnings |
|---|---|---|---|
| Jul 02 2022 | n/a | n/a | US$869m |
| Apr 02 2022 | n/a | n/a | US$845m |
| Jan 01 2022 | US$10m | US$1m | US$821m |
| Oct 02 2021 | n/a | n/a | US$806m |
| Jul 03 2021 | n/a | n/a | US$789m |
| Apr 03 2021 | n/a | n/a | US$682m |
| Jan 02 2021 | US$8m | US$1m | US$627m |
| Sep 26 2020 | n/a | n/a | US$589m |
| Jun 27 2020 | n/a | n/a | US$574m |
| Mar 28 2020 | n/a | n/a | US$653m |
| Dec 28 2019 | US$8m | US$1m | US$694m |
| Sep 28 2019 | n/a | n/a | US$698m |
| Jun 29 2019 | n/a | n/a | US$697m |
| Mar 30 2019 | n/a | n/a | US$695m |
| Dec 29 2018 | US$9m | US$1m | US$680m |
| Sep 29 2018 | n/a | n/a | US$634m |
| Jun 30 2018 | n/a | n/a | US$605m |
| Mar 31 2018 | n/a | n/a | US$579m |
| Dec 30 2017 | US$10m | US$1m | US$558m |
| Sep 30 2017 | n/a | n/a | US$575m |
| Jul 01 2017 | n/a | n/a | US$573m |
| Apr 01 2017 | n/a | n/a | US$560m |
| Dec 31 2016 | US$10m | US$1m | US$546m |
| Oct 01 2016 | n/a | n/a | US$532m |
| Jul 02 2016 | n/a | n/a | US$517m |
| Apr 02 2016 | n/a | n/a | US$497m |
| Jan 02 2016 | US$11m | US$1m | US$479m |
Compensation vs Market: Nicholas's total compensation ($USD9.87M) is about average for companies of similar size in the US market ($USD13.03M).
Compensation vs Earnings: Nicholas's compensation has increased by more than 20% in the past year.
Leadership Team
Experienced Management: SNA's management team is seasoned and experienced (5.3 years average tenure).
Board Members
Experienced Board: SNA's board of directors are seasoned and experienced ( 13 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.
Recent Insider Transactions
| Date | Value | Name | Entity | Role | Shares | Max Price |
|---|---|---|---|---|---|---|
| 11 Feb 22 | SellUS$80,791 | W. Lehman | Individual | 381 | US$212.05 | |
| 09 Dec 21 | SellUS$482,440 | Karen Daniel | Individual | 2,259 | US$213.56 |
Ownership Breakdown
| Owner Type | Number of Shares | Ownership Percentage |
|---|---|---|
| State or Government | 22,973 | 0.04% |
| Individual Insiders | 897,527 | 1.7% |
| General Public | 5,536,185 | 10.4% |
| Institutions | 46,811,204 | 87.9% |
Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.
Top Shareholders
| Ownership | Name | Shares | Current Value | Change % | Portfolio % | |
|---|---|---|---|---|---|---|
| 6,472,349 | $1.3b | 1.67% | 0.03% | |||
| 4,639,204 | $940.6m | -3.42% | 0.02% | |||
| 2,238,750 | $453.9m | -3.38% | 0.03% | |||
| 1,324,268 | $268.5m | 9.38% | 0.04% | |||
| 1,299,988 | $263.6m | -7.94% | 0.31% | |||
| 1,234,803 | $250.4m | -10.82% | 0.05% | |||
| 1,065,779 | $216.1m | 5.87% | 0.06% | |||
| 1,046,617 | $212.2m | -3.38% | 0.06% | |||
| 1,018,185 | $206.4m | -9.84% | 2.04% | |||
| 861,525 | $174.7m | -1.81% | 0.04% | |||
| 729,620 | $147.9m | -0.17% | 1.49% | |||
| 704,289 | $142.8m | -7.8% | 0.3% | |||
| 686,933 | $139.3m | 2.55% | 0.03% | |||
| 681,271 | $138.1m | -10% | 0.32% | |||
| 659,919 | $133.8m | 0.76% | 2.25% | |||
| 641,141 | $130.0m | 2.93% | no data | |||
| 567,645 | $115.1m | 14.28% | 0.78% | |||
| 516,935 | $104.8m | 1.75% | 0.1% | |||
| 460,664 | $93.4m | 0% | 1.13% | |||
| 452,949 | $91.8m | 7.25% | 3.82% | |||
| 450,006 | $91.2m | 6.63% | 0.05% | |||
| 446,150 | $90.5m | -6.98% | 0.03% | |||
| 445,340 | $90.3m | -54.29% | 0.03% | |||
| 432,753 | $87.7m | 0% | 0.01% | |||
| 431,354 | $87.5m | 1.34% | 2.49% |
Company Information
Snap-on Incorporated's employee growth, exchange listings and data sources
Key Information
- Name: Snap-on Incorporated
- Ticker: SNA
- Exchange: NYSE
- Founded: 1920
- Industry: Industrial Machinery
- Sector: Capital Goods
- Implied Market Cap: US$10.801b
- Shares outstanding: 53.27m
- Website: https://www.snapon.com
Number of Employees
Location
- Snap-on Incorporated
- 2801 80th Street
- Kenosha
- Wisconsin
- 53143
- United States
Listings
| Ticker | Exchange | Primary Security | Security Type | Country | Currency | Listed on |
|---|---|---|---|---|---|---|
| SNA | NYSE (New York Stock Exchange) | Yes | Common Stock | US | USD | Feb 1978 |
| SPU | DB (Deutsche Boerse AG) | Yes | Common Stock | DE | EUR | Feb 1978 |
| SPU | XTRA (XETRA Trading Platform) | Yes | Common Stock | DE | EUR | Feb 1978 |
| 0L7G | LSE (London Stock Exchange) | Yes | Common Stock | GB | USD | Feb 1978 |
| SNA | BASE (Buenos Aires Stock Exchange) | CEDEAR EACH 6 REP 1 | AR | ARS | Sep 2005 | |
| S1NA34 | BOVESPA (Bolsa de Valores de Sao Paulo) | BDR EACH 4 REPR 1 COM | BR | BRL | Jan 2020 |
Company Analysis and Financial Data Status
| Data | Last Updated (UTC time) |
|---|---|
| Company Analysis | 2022/09/29 00:00 |
| End of Day Share Price | 2022/09/29 00:00 |
| Earnings | 2022/07/02 |
| Annual Earnings | 2022/01/01 |
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.