NYSE:TTC

Stock Analysis Report

Executive Summary

The Toro Company designs, manufactures, and markets professional and residential equipment worldwide.


Snowflake Analysis

Excellent balance sheet with acceptable track record.


Similar Companies

Share Price & News

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


Latest Share Price and Events

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


Market Performance


7 Day Return

7.7%

TTC

7.2%

US Machinery

5.3%

US Market


1 Year Return

-6.4%

TTC

-22.4%

US Machinery

-10.7%

US Market

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

Return vs Market: TTC exceeded the US Market which returned -10.7% over the past year.


Shareholder returns

TTCIndustryMarket
7 Day7.7%7.2%5.3%
30 Day-13.3%-19.0%-13.6%
90 Day-18.9%-29.4%-19.8%
1 Year-5.1%-6.4%-20.1%-22.4%-8.9%-10.7%
3 Year9.7%5.5%0.4%-6.9%15.5%8.0%
5 Year104.0%91.0%21.8%6.4%35.2%20.4%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

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

8.6%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: TTC ($65.1) is trading below our estimate of fair value ($71.24)

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


Price To Earnings Ratio

PE vs Industry: TTC is poor value based on its PE Ratio (24.5x) compared to the Machinery industry average (15.5x).

PE vs Market: TTC is poor value based on its PE Ratio (24.5x) compared to the US market (13.1x).


Price to Earnings Growth Ratio

PEG Ratio: TTC is poor value based on its PEG Ratio (2.7x)


Price to Book Ratio

PB vs Industry: TTC is overvalued based on its PB Ratio (7.6x) compared to the US Machinery industry average (1.6x).


Next Steps

Future Growth

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

9.2%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: TTC's forecast earnings growth (9.2% per year) is above the savings rate (1.7%).

Earnings vs Market: TTC's earnings (9.2% per year) are forecast to grow slower than the US market (12.3% per year).

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

Revenue vs Market: TTC's revenue (5.1% per year) is forecast to grow slower than the US market (7.2% per year).

High Growth Revenue: TTC's revenue (5.1% 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 TTC's Return on Equity is forecast to be high in 3 years time


Next Steps

Past Performance

How has Toro performed over the past 5 years?

9.1%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: TTC has high quality earnings.

Growing Profit Margin: TTC's current net profit margins (8.6%) are lower than last year (11.5%).


Past Earnings Growth Analysis

Earnings Trend: TTC's earnings have grown by 9.1% per year over the past 5 years.

Accelerating Growth: TTC's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: TTC had negative earnings growth (-7.8%) over the past year, making it difficult to compare to the Machinery industry average (-2%).


Return on Equity

High ROE: TTC's Return on Equity (31.2%) is considered high.


Next Steps

Financial Health

How is Toro's financial position?


Financial Position Analysis

Short Term Liabilities: TTC's short term assets ($1.2B) exceed its short term liabilities ($824.3M).

Long Term Liabilities: TTC's short term assets ($1.2B) exceed its long term liabilities ($755.3M).


Debt to Equity History and Analysis

Debt Level: TTC's debt to equity ratio (78.4%) is considered high.

Reducing Debt: TTC's debt to equity ratio has reduced from 104% to 78.4% over the past 5 years.

Debt Coverage: TTC's debt is well covered by operating cash flow (40.3%).

Interest Coverage: TTC's interest payments on its debt are well covered by EBIT (14.3x coverage).


Balance Sheet

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

Debt Coverage by Assets: TTC's debt is covered by short term assets (assets are 1.7x debt).


Next Steps

Dividend

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

1.54%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: TTC's dividend (1.54%) isn’t notable compared to the bottom 25% of dividend payers in the US market (1.95%).

High Dividend: TTC's dividend (1.54%) is low compared to the top 25% of dividend payers in the US market (5.37%).


Stability and Growth of Payments

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

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


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (34.8%), TTC's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: Insufficient data to determine if a dividend will be paid in 3 years and that it will be covered by earnings.


Next Steps

Management

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

5.0yrs

Average management tenure


CEO

Rick Olson (55yo)

3.42s

Tenure

US$5,267,433

Compensation

Mr. Richard M. Olson, also known as Rick, has been the Chief Executive Officer of The Toro Company November 1, 2016 and as its President since September 1, 2015. Mr. Olson has been the Chairman of The Toro ...


CEO Compensation Analysis

Compensation vs Market: Rick's total compensation ($USD5.27M) is about average for companies of similar size in the US market ($USD7.33M).

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


Leadership Team

NamePositionTenureCompensationOwnership
Richard Olson
Chairman3.42yrsUS$5.27m0.023% $1.6m
Renee Peterson
VP, Treasurer & CFO8.67yrsUS$1.76m0.062% $4.3m
Blake Grams
Vice President of Global Operations6.83yrsno data0.0017% $120.5k
Kurt Svendsen
Vice President of Information Services6.83yrsno data0.021% $1.4m
Heather Hille
Director of Investor Relations & External Communications4.92yrsno datano data
Amy Dahl
General Counsel0.25yrno data0.014% $1.0m
Thomas Swain
Managing Director of Distributor Development5yrsno datano data
Julie Kerekes
Managing Director of Tax & Treasuryno datano datano data
Nicholas Rhoads
Director of Business Development & Strategic Planningno datano datano data
Angie Snavely
Directorno datano datano data

5.0yrs

Average Tenure

54yo

Average Age

Experienced Management: TTC's management team is seasoned and experienced (5 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Richard Olson
Chairman3.42yrsUS$5.27m0.023% $1.6m
Gregg Steinhafel
Independent Director21.25yrsUS$208.47k0.049% $3.4m
Jeffrey Ettinger
Independent Director9.75yrsUS$211.87k0.039% $2.7m
Janet Katherine Cooper
Independent Director26.25yrsUS$232.70k0.023% $1.6m
Katherine Harless
Independent Director20.25yrsUS$215.08k0.066% $4.6m
D. Koch
Independent Director4yrsUS$209.90k0.0038% $266.7k
Gary Ellis
Lead Independent Director1.08yrsUS$239.22k0.028% $1.9m
Jeffrey Harmening
Independent Director1.08yrsUS$62.89k0.0019% $129.5k
James O'Rourke
Independent Director7.67yrsUS$216.20k0.011% $736.7k
Michael Vale
Independent Director2.25yrsUS$213.65kno data

5.8yrs

Average Tenure

59.5yo

Average Age

Experienced Board: TTC's board of directors are considered experienced (5.8 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.


Top Shareholders

Company Information

The Toro Company's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: The Toro Company
  • Ticker: TTC
  • Exchange: NYSE
  • Founded: 1914
  • Industry: Agricultural and Farm Machinery
  • Sector: Capital Goods
  • Market Cap: US$6.963b
  • Shares outstanding: 106.98m
  • Website: https://www.thetorocompany.com

Number of Employees


Location

  • The Toro Company
  • 8111 Lyndale Avenue South
  • Bloomington
  • Minnesota
  • 55420
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
TTCNYSE (New York Stock Exchange)YesCommon StockUSUSDSep 1978
TO2DB (Deutsche Boerse AG)YesCommon StockDEEURSep 1978
TO2BRSE (Berne Stock Exchange)YesCommon StockCHCHFSep 1978

Biography

The Toro Company designs, manufactures, and markets professional and residential equipment worldwide. The company’s Professional segment offers turf and landscape equipment products, including sports fields and grounds maintenance equipment, golf course mowing and maintenance equipment, landscape contractor mowing equipment, landscape creation and renovation equipment, rental and specialty construction equipment, and other maintenance equipment; and snow and ice management equipment, such as snowplows, salt and sand spreaders, and related parts and accessories for light and medium duty trucks, utility task vehicles, skid steers, and front-end loaders. It also provides irrigation products comprising sprinkler heads, electric and hydraulic valves, controllers, computer irrigation central control systems, coupling systems, and agricultural irrigation system drip tape and hose products, as well as professionally installed lighting products through distributors and landscape contractors. This segment sells its products primarily through a network of distributors and dealers to professional users engaged in maintaining golf courses, sports fields, municipal properties, agricultural fields, residential and commercial landscapes, and removing snow and ice, as well as directly to government customers, rental companies, and retailers. Its Residential segment provides walk power mowers, riding mowers, snow throwers, replacement parts, and home solution products that include trimmers, blowers, blower-vacuums, and underground and hose-end retail irrigation products. This segment sells its products to homeowners through a network of distributors and dealers; and various home centers, hardware retailers, and mass retailers, as well as online. The Toro Company was founded in 1914 and is headquartered in Bloomington, Minnesota. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/04/01 04:21
End of Day Share Price2020/03/31 00:00
Earnings2020/01/31
Annual Earnings2019/10/31


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.