Ingersoll-Rand PLC

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IR : NYSE : Industrial Goods
$67.72 | %
Today's Range: 66.57 - 67.76
Avg. Daily Volume: 1,809,700
07/22/16 - 4:02 PM ET

Financial Analysis


INGERSOLL-RAND PLC's gross profit margin for the first quarter of its fiscal year 2016 is essentially unchanged when compared to the same period a year ago. The company managed to grow both sales and net income at a faster pace than the average competitor in its industry this quarter as compared to the same quarter a year ago. INGERSOLL-RAND PLC has weak liquidity. Currently, the Quick Ratio is 0.73 which shows a lack of ability to cover short-term cash needs. The company's liquidity has decreased from the same period last year.

At the same time, stockholders' equity ("net worth") has remained virtually unchanged only increasing by 1.19% from the same quarter last year. Overall, the key liquidity measurements indicate that the company is in a position in which financial difficulties could develop in the future.

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Income Statement Q1 FY16 Q1 FY15
Net Sales ($mil)2894.12887.8
EBITDA ($mil)305.3259.0
EBIT ($mil)217.3171.1
Net Income ($mil)152.451.3


Balance Sheet Q1 FY16 Q1 FY15
Cash & Equiv. ($mil)612.9733.9
Total Assets ($mil)16952.517409.0
Total Debt ($mil)4472.64544.0
Equity ($mil)5792.85724.2


Profitability Q1 FY16 Q1 FY15
Gross Profit Margin32.3130.78
EBITDA Margin10.548.96
Operating Margin7.515.92
Sales Turnover0.780.75
Return on Assets4.515.19
Return on Equity13.0415.36
Debt Q1 FY16 Q1 FY15
Current Ratio1.221.28
Debt/Capital0.440.44
Interest Expense56.755.1
Interest Coverage3.833.11


Share Data Q1 FY16 Q1 FY15
Shares outstanding (mil)257.3264.6
Div / share0.320.29
EPS0.480.22
Book value / share22.5121.63
Institutional Own % n/a n/a
Avg Daily Volume1803030.02269929.0

Valuation


BUY. INGERSOLL-RAND PLC's P/E ratio indicates a discount compared to an average of 24.52 for the Machinery industry and a value on par with the S&P 500 average of 25.05. To use another comparison, its price-to-book ratio of 2.98 indicates valuation on par with the S&P 500 average of 2.81 and a discount versus the industry average of 3.79. The current price-to-sales ratio is well below the S&P 500 average and is also below the industry average, indicating a discount. Upon assessment of these and other key valuation criteria, INGERSOLL-RAND PLC proves to trade at a discount to investment alternatives within the industry.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
IR 23.60 Peers 24.52   IR 18.19 Peers 16.07

Average. An average P/E ratio can signify an industry neutral price for a stock and an average growth expectation.

IR is trading at a valuation on par with its peers.

 

Premium. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.

IR is trading at a premium to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
IR 14.92 Peers 21.65   IR 0.40 Peers 3.66

Discount. A lower price-to-projected earnings ratio than its peers can signify a less expensive stock or lower future growth expectations.

IR is trading at a discount to its peers.

 

Discount. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.

IR trades at a significant discount to its peers.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
IR 2.98 Peers 3.79   IR -12.35 Peers -27.70

Discount. A lower price-to-book ratio makes a stock more attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

IR is trading at a discount to its peers.

 

Higher. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

IR is expected to have an earnings growth rate that significantly exceeds its peers.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
IR 1.30 Peers 1.63   IR 1.92 Peers -5.12

Discount. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.

IR is trading at a discount to its industry on this measurement.

 

Higher. A sales growth rate that exceeds the industry implies that a company is gaining market share.

IR has a sales growth rate that significantly exceeds its peers.

 

 

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