NasdaqGS:ITRN

Stock Analysis Report

Ituran Location and Control

Executive Summary

Ituran Location and Control Ltd., together with its subsidiaries, provides location-based services and wireless communications products.

Rewards

Trading at 28.6% below its fair value

Risk Analysis

Has a high level of debt

Unstable dividend track record

Profit margins (11.4%) are lower than last year (25.2%)



Snowflake Analysis

Good value with adequate balance sheet and pays a dividend.


Similar Companies

Share Price & News

How has Ituran Location and Control's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: ITRN has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

-3.6%

ITRN

0.1%

US Communications

-1.2%

US Market


1 Year Return

-22.9%

ITRN

5.4%

US Communications

22.3%

US Market

Return vs Industry: ITRN underperformed the US Communications industry which returned 6.7% over the past year.

Return vs Market: ITRN underperformed the US Market which returned 24.7% over the past year.


Shareholder returns

ITRNIndustryMarket
7 Day-3.6%0.1%-1.2%
30 Day-0.9%2.9%1.6%
90 Day-0.4%3.8%8.8%
1 Year-20.3%-22.9%7.6%5.4%25.0%22.3%
3 Year-0.2%-9.5%51.0%41.4%49.9%40.3%
5 Year40.0%17.7%83.4%62.9%77.6%58.0%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

Is Ituran Location and Control undervalued compared to its fair value and its price relative to the market?

31.4%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: ITRN ($25.94) is trading below our estimate of fair value ($36.34)

Significantly Below Fair Value: ITRN is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: ITRN is good value based on its PE Ratio (16.4x) compared to the Communications industry average (21.1x).

PE vs Market: ITRN is good value based on its PE Ratio (16.4x) compared to the US market (18.9x).


Price to Earnings Growth Ratio

PEG Ratio: ITRN is poor value based on its PEG Ratio (13.3x)


Price to Book Ratio

PB vs Industry: ITRN is overvalued based on its PB Ratio (3.6x) compared to the US Communications industry average (1.9x).


Next Steps

Future Growth

How is Ituran Location and Control forecast to perform in the next 1 to 3 years based on estimates from 1 analyst?

1.2%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: ITRN's forecast earnings growth (1.2% per year) is below the savings rate (1.7%).

Earnings vs Market: ITRN's earnings (1.2% per year) are forecast to grow slower than the US market (14.3% per year).

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

Revenue vs Market: ITRN's revenue is expected to decline over the next 3 years (-6.5% per year).

High Growth Revenue: ITRN's revenue is forecast to decline over the next 3 years (-6.5% per year).


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: Insufficient data to determine if ITRN's Return on Equity is forecast to be high in 3 years time


Next Steps

Past Performance

How has Ituran Location and Control performed over the past 5 years?

15.9%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: ITRN has high quality earnings.

Growing Profit Margin: ITRN's current net profit margins (11.4%) are lower than last year (25.2%).


Past Earnings Growth Analysis

Earnings Trend: ITRN's earnings have grown by 15.9% per year over the past 5 years.

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

Earnings vs Industry: ITRN had negative earnings growth (-43.4%) over the past year, making it difficult to compare to the Communications industry average (12.6%).


Return on Equity

High ROE: ITRN's Return on Equity (21.9%) is considered high.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Ituran Location and Control's financial position?


Financial Position Analysis

Short Term Liabilities: ITRN's short term assets ($179.0M) exceed its short term liabilities ($102.7M).

Long Term Liabilities: ITRN's short term assets ($179.0M) exceed its long term liabilities ($104.9M).


Debt to Equity History and Analysis

Debt Level: ITRN's debt to equity ratio (47.6%) is considered high.

Reducing Debt: ITRN's debt to equity ratio has increased from 0% to 47.6% over the past 5 years.

Debt Coverage: ITRN's debt is well covered by operating cash flow (82.2%).

Interest Coverage: ITRN's interest payments on its debt are well covered by EBIT (12.3x coverage).


Balance Sheet

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

Debt Coverage by Assets: ITRN's debt is covered by short term assets (assets are 2.4x debt).


Next Steps

Dividend

What is Ituran Location and Control's current dividend yield, its reliability and sustainability?

3.71%

Current Dividend Yield


Dividend Yield vs Market

company3.7%marketbottom25%1.4%markettop25%3.7%industryaverage2.9%forecastin3Years3.8%

Current dividend yield vs market & industry

Notable Dividend: ITRN's dividend (3.55%) is higher than the bottom 25% of dividend payers in the US market (1.4%).

High Dividend: ITRN's dividend (3.69%) is in the top 25% of dividend payers in the US market (3.68%)


Stability and Growth of Payments

Stable Dividend: ITRN's dividend payments have been volatile in the past 10 years.

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


Current Payout to Shareholders

Dividend Coverage: With its reasonable payout ratio (60.1%), ITRN's dividend payments are 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

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

17.0yrs

Average management tenure


CEO

Nir Sheratzky (47yo)

17yrs

Tenure

US$1,453,000

Compensation

Mr. Nir Sheratzky serves as a Senior Vice President at Ituran Group. Mr. Sheratzky has been a Co-Chief Executive Officer at Ituran Location & Control Ltd. since 2003. He served as an Alternate Chief Execut ...


CEO Compensation Analysis

Compensation vs Market: Nir's total compensation ($USD1.45M) is about average for companies of similar size in the US market ($USD1.70M).

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


Management Age and Tenure

17.0yrs

Average Tenure

52yo

Average Age

Experienced Management: ITRN's management team is seasoned and experienced (17 years average tenure).


Board Age and Tenure

25.0yrs

Average Tenure

68.5yo

Average Age

Experienced Board: ITRN's board of directors are seasoned and experienced ( 25 years average tenure).


Insider Trading

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.


Management Team

  • Eyal Sheratzky (50yo)

    Co-CEO & Director

    • Tenure: 25yrs
    • Compensation: US$1.45m
  • Nir Sheratzky (47yo)

    Co-CEO & Director

    • Tenure: 17yrs
    • Compensation: US$1.45m
  • Izzy Sheratzky (72yo)

    Co-Founder

    • Tenure: 25yrs
    • Compensation: US$1.82m
  • Gil Sheratzky (41yo)

    Intl. Activity & Business Development Officer and Director

    • Tenure: 25yrs
    • Compensation: US$1.04m
  • Udi Mizrahi (47yo)

    Deputy CEO of International Operation & VP of Finance

    • Eli Kamer (52yo)

      Executive VP of Finance & CFO

      • Tenure: 21yrs
    • Yehuda Kahane (75yo)

      Co-Founder & Director

      • Tenure: 25yrs
    • Guy Aharonov (53yo)

      General Counsel & VP of Legal

      • Tenure: 21yrs
    • Ami Saranga (55yo)

      Deputy Chief Executive Officer

      • Tenure: 9yrs
      • Compensation: US$380.00k

    Board Members

    • Eyal Sheratzky (50yo)

      Co-CEO & Director

      • Tenure: 25yrs
      • Compensation: US$1.45m
    • Nir Sheratzky (47yo)

      Co-CEO & Director

      • Tenure: 17yrs
      • Compensation: US$1.45m
    • Yoav Kahane (45yo)

      Independent Director

      • Tenure: 22yrs
      • Compensation: US$144.00k
    • Izzy Sheratzky (72yo)

      Co-Founder

      • Tenure: 25yrs
      • Compensation: US$1.82m
    • Gil Sheratzky (41yo)

      Intl. Activity & Business Development Officer and Director

      • Tenure: 25yrs
      • Compensation: US$1.04m
    • Yigal Shani (74yo)

      Director

      • Tenure: 4.9yrs
    • Yehuda Kahane (75yo)

      Co-Founder & Director

      • Tenure: 25yrs
    • Israel Baron (65yo)

      External Director

      • Tenure: 17yrs
    • Ze'ev Koren (73yo)

      Independent Chairman of the Board

      • Tenure: 9yrs
      • Compensation: US$200.00k
    • Gidon Kotler (78yo)

      External Director

      Company Information

      Ituran Location and Control Ltd.'s company bio, employee growth, exchange listings and data sources


      Key Information

      • Name: Ituran Location and Control Ltd.
      • Ticker: ITRN
      • Exchange: NasdaqGS
      • Founded: 1994
      • Industry: Communications Equipment
      • Sector: Tech
      • Market Cap: US$521.820m
      • Shares outstanding: 21.04m
      • Website: https://www.ituran.com

      Number of Employees


      Location

      • Ituran Location and Control Ltd.
      • 3 Hashikma Street
      • Azour Industrial Zone
      • Azor
      • 58001
      • Israel

      Listings

      TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
      ITRNNasdaqGS (Nasdaq Global Select)YesOrdinary SharesUSUSDApr 2000
      I4LDB (Deutsche Boerse AG)YesOrdinary SharesDEEURApr 2000

      Biography

      Ituran Location and Control Ltd., together with its subsidiaries, provides location-based services and wireless communications products. The company’s Location-Based Services segment provides stolen vehicle recovery and tracking services, which locate, track, and recover stolen vehicles for its subscribers; fleet management services that enable corporate and individual customers to track and manage their vehicles in real time; and personal locator services that allow customers to protect valuable merchandise and equipment. It also offers on-demand navigation guidance, information, and assistance, including the provision of traffic reports and directions, as well as information on the location of gas stations, car repair shops, post offices, hospitals, and other facilities; and Connect, an Android platform that provides access to Android applications and various services through manufacturer interface. This segment serves insurance companies and agents, car manufacturers, dealers and importers, cooperative sales channels, and private subscribers. The company’s Wireless Communications Products segment provides Base Site, a radio receiver that includes a processor and a data computation unit to collect and send data to and from transponders, and to control centers; Control Center, a center consisting of software used to collect data from various base sites, conduct location calculations, and transmit location data to various customers and law enforcement agencies; navigation and tracking devices installed in vehicles; and SMART, a portable transmitter installed in vehicles that sends a signal to the base site enabling the location of vehicles, equipment, or an individual. As of December 31, 2018, it served approximately 230,000 end-users through 40,000 corporate customers in Israel, Brazil, Argentina, Mexico, Ecuador, Colombia, and the United States. The company was founded in 1994 and is headquartered in Azor, Israel. 


      Company Analysis and Financial Data Status

      All financial data provided by Standard & Poor's Capital IQ.
      DataLast Updated (UTC time)
      Company Analysis2020/01/27 00:07
      End of Day Share Price2020/01/24 00:00
      Earnings2019/09/30
      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.