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SNA

Snap-on NYSE:SNA Stock Report

Last Price

US$202.76

Market Cap

US$10.8b

7D

-3.9%

1Y

-3.0%

Updated

29 Sep, 2022

Data

Company Financials +
SNA fundamental analysis
Snowflake Score
Valuation5/6
Future Growth0/6
Past Performance6/6
Financial Health6/6
Dividends5/6

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

Summary of all time highs, changes and price drops for Snap-on
Historical stock prices
Current Share PriceUS$202.76
52 Week HighUS$235.36
52 Week LowUS$190.08
Beta1.11
1 Month Change-7.10%
3 Month Change2.28%
1 Year Change-2.96%
3 Year Change33.30%
5 Year Change36.46%
Change since IPO821.64%

Recent News & Updates

Sep 29

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.

Sep 02
Many Would Be Envious Of Snap-on's (NYSE:SNA) Excellent Returns On Capital

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...

Aug 08

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

SNAUS MachineryUS 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

Is SNA's price volatile compared to industry and market?
SNA volatility
SNA Average Weekly Movement3.2%
Machinery Industry Average Movement5.3%
Market Average Movement6.9%
10% most volatile stocks in US Market15.7%
10% least volatile stocks in US Market2.8%

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

FoundedEmployeesCEOWebsite
192012,800Nicholas Pinchukhttps://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

How do Snap-on's earnings and revenue compare to its market cap?
SNA fundamental statistics
Market CapUS$10.80b
Earnings (TTM)US$868.80m
Revenue (TTM)US$4.73b

12.4x

P/E Ratio

2.3x

P/S Ratio

Earnings & Revenue

Key profitability statistics from the latest earnings report
SNA income statement (TTM)
RevenueUS$4.73b
Cost of RevenueUS$2.24b
Gross ProfitUS$2.42b
Other ExpensesUS$1.55b
EarningsUS$868.80m

Last Reported Earnings

Jul 02, 2022

Next Earnings Date

n/a

Earnings per share (EPS)16.31
Gross Margin51.08%
Net Profit Margin18.37%
Debt/Equity Ratio27.7%

How did SNA perform over the long term?

See historical performance and comparison

Dividends

2.8%

Current Dividend Yield

34%

Payout Ratio
We’ve recently updated our valuation analysis.

Valuation

Is SNA 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 SNA?

Other financial metrics that can be useful for relative valuation.

SNA 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/Revenue2.4x
Enterprise Value/EBITDA8.7x
PEG Ratio-31x

Price to Earnings Ratio vs Peers

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

SNA PE Ratio vs Peers
The above table shows the PE ratio for SNA vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
CompanyPEEstimated GrowthMarket Cap
Peer Average22.5x
SWK Stanley Black & Decker
12.1x30.6%US$11.4b
GGG Graco
23x7.8%US$10.2b
NDSN Nordson
25.4x10.3%US$12.2b
IEX IDEX
29.5x13.1%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.

SNA PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio12.4x
Fair PE Ratio16.2x

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

0/6

Future 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%).


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Past Performance

How has Snap-on performed over the past 5 years?

Past Performance Score

6/6

Past 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.


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Financial Health

How is Snap-on's financial position?

Financial Health Score

6/6

Financial 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


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Dividend

What is Snap-on current dividend yield, its reliability and sustainability?

Dividend Score

5/6

Dividend 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
How does Snap-on dividend yield compare to the market?
SegmentDividend 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
How has Nicholas Pinchuk's remuneration changed compared to Snap-on's earnings?
DateTotal Comp.SalaryCompany Earnings
Jul 02 2022n/an/a

US$869m

Apr 02 2022n/an/a

US$845m

Jan 01 2022US$10mUS$1m

US$821m

Oct 02 2021n/an/a

US$806m

Jul 03 2021n/an/a

US$789m

Apr 03 2021n/an/a

US$682m

Jan 02 2021US$8mUS$1m

US$627m

Sep 26 2020n/an/a

US$589m

Jun 27 2020n/an/a

US$574m

Mar 28 2020n/an/a

US$653m

Dec 28 2019US$8mUS$1m

US$694m

Sep 28 2019n/an/a

US$698m

Jun 29 2019n/an/a

US$697m

Mar 30 2019n/an/a

US$695m

Dec 29 2018US$9mUS$1m

US$680m

Sep 29 2018n/an/a

US$634m

Jun 30 2018n/an/a

US$605m

Mar 31 2018n/an/a

US$579m

Dec 30 2017US$10mUS$1m

US$558m

Sep 30 2017n/an/a

US$575m

Jul 01 2017n/an/a

US$573m

Apr 01 2017n/an/a

US$560m

Dec 31 2016US$10mUS$1m

US$546m

Oct 01 2016n/an/a

US$532m

Jul 02 2016n/an/a

US$517m

Apr 02 2016n/an/a

US$497m

Jan 02 2016US$11mUS$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

NYSE:SNA Recent Insider Transactions by Companies or Individuals
DateValueNameEntityRoleSharesMax Price
11 Feb 22SellUS$80,791W. LehmanIndividual381US$212.05
09 Dec 21SellUS$482,440Karen DanielIndividual2,259US$213.56

Ownership Breakdown

What is the ownership structure of SNA?
Owner TypeNumber of SharesOwnership Percentage
State or Government22,9730.04%
Individual Insiders897,5271.7%
General Public5,536,18510.4%
Institutions46,811,20487.9%

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


Top Shareholders

Top 25 shareholders own 55.4% of the company
OwnershipNameSharesCurrent ValueChange %Portfolio %
12.15%
The Vanguard Group, Inc.
6,472,349$1.3b1.67%0.03%
8.71%
BlackRock, Inc.
4,639,204$940.6m-3.42%0.02%
4.2%
State Street Global Advisors, Inc.
2,238,750$453.9m-3.38%0.03%
2.49%
Geode Capital Management, LLC
1,324,268$268.5m9.38%0.04%
2.44%
First Trust Advisors LP
1,299,988$263.6m-7.94%0.31%
2.32%
J.P. Morgan Asset Management, Inc.
1,234,803$250.4m-10.82%0.05%
2%
Charles Schwab Investment Management, Inc.
1,065,779$216.1m5.87%0.06%
1.96%
Dimensional Fund Advisors LP
1,046,617$212.2m-3.38%0.06%
1.91%
Ariel Investments, LLC
1,018,185$206.4m-9.84%2.04%
1.62%
Northern Trust Global Investments
861,525$174.7m-1.81%0.04%
1.37%
Regions Investment Management, Inc.
729,620$147.9m-0.17%1.49%
1.32%
LSV Asset Management
704,289$142.8m-7.8%0.3%
1.29%
BNY Mellon Asset Management
686,933$139.3m2.55%0.03%
1.28%
AQR Capital Management, LLC
681,271$138.1m-10%0.32%
1.24%
Confluence Investment Management LLC
659,919$133.8m0.76%2.25%
1.2%
Nicholas Pinchuk
641,141$130.0m2.93%no data
1.07%
EARNEST Partners, LLC
567,645$115.1m14.28%0.78%
0.97%
Nordea Investment Management AB
516,935$104.8m1.75%0.1%
0.86%
Cincinnati Financial Corp., Asset Management Arm
460,664$93.4m0%1.13%
0.85%
Hamlin Capital Management, LLC
452,949$91.8m7.25%3.82%
0.84%
Envestnet Asset Management, Inc.
450,006$91.2m6.63%0.05%
0.84%
Legal & General Investment Management Limited
446,150$90.5m-6.98%0.03%
0.84%
Columbia Management Investment Advisers, LLC
445,340$90.3m-54.29%0.03%
0.81%
Norges Bank Investment Management
432,753$87.7m0%0.01%
0.81%
Disciplined Growth Investors, Inc.
431,354$87.5m1.34%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

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
SNANYSE (New York Stock Exchange)YesCommon StockUSUSDFeb 1978
SPUDB (Deutsche Boerse AG)YesCommon StockDEEURFeb 1978
SPUXTRA (XETRA Trading Platform)YesCommon StockDEEURFeb 1978
0L7GLSE (London Stock Exchange)YesCommon StockGBUSDFeb 1978
SNABASE (Buenos Aires Stock Exchange)CEDEAR EACH 6 REP 1ARARSSep 2005
S1NA34BOVESPA (Bolsa de Valores de Sao Paulo)BDR EACH 4 REPR 1 COMBRBRLJan 2020

Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2022/09/29 00:00
End of Day Share Price2022/09/29 00:00
Earnings2022/07/02
Annual Earnings2022/01/01


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.