Stanley Black & Decker Inc

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SWK : NYSE : Industrial Goods
$137.1 -0.4 | -0.29%
Today's Range: 136.33 - 137.955
Avg. Daily Volume: 979300.0
08/21/17 - 12:21 PM ET

Financial Analysis


STANLEY BLACK & DECKER INC's gross profit margin for the second quarter of its fiscal year 2017 is essentially unchanged when compared to the same period a year ago. The company has grown sales and net income during the past quarter when compared with the same quarter a year ago, however, it was unable to keep up with the growth of the average competitor within its industry. STANLEY BLACK & DECKER INC has weak liquidity. Currently, the Quick Ratio is 0.64 which shows a lack of ability to cover short-term cash needs. The company's liquidity has increased from the same period last year.

At the same time, stockholders' equity ("net worth") has greatly increased by 32.67% 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 Q2 FY17 Q2 FY16
Net Sales ($mil)3229.52932.4
EBITDA ($mil)582.0527.6
EBIT ($mil)466.2425.6
Net Income ($mil)277.2271.5


Balance Sheet Q2 FY17 Q2 FY16
Cash & Equiv. ($mil)539.5568.2
Total Assets ($mil)19312.315740.8
Total Debt ($mil)4409.14172.0
Equity ($mil)7700.05803.5


Profitability Q2 FY17 Q2 FY16
Gross Profit Margin40.6340.73
EBITDA Margin18.0217.99
Operating Margin14.4414.51
Sales Turnover0.610.72
Return on Assets6.086.06
Return on Equity15.2516.57
Debt Q2 FY17 Q2 FY16
Current Ratio1.251.16
Debt/Capital0.360.42
Interest Expense56.047.7
Interest Coverage8.338.92


Share Data Q2 FY17 Q2 FY16
Shares outstanding (mil)153.15150.43
Div / share0.580.55
EPS1.821.84
Book value / share50.2838.58
Institutional Own % n/a n/a
Avg Daily Volume980698.0964263.0

Valuation


BUY. The current P/E ratio indicates a significant discount compared to an average of 117.12 for the Machinery industry and a discount compared to the S&P 500 average of 24.23. To use another comparison, its price-to-book ratio of 2.75 indicates valuation on par with the S&P 500 average of 3.02 and a significant discount versus the industry average of 5.84. The price-to-sales ratio is below both the S&P 500 average and the industry average, indicating a discount. Upon assessment of these and other key valuation criteria, STANLEY BLACK & DECKER INC 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
SWK 17.71 Peers 117.12   SWK 17.76 Peers 17.49

Discount. A lower P/E ratio than its peers can signify a less expensive stock or lower growth expectations.

SWK is trading at a significant discount to its peers.

 

Average. 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.

SWK is trading at a valuation on par to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
SWK 16.95 Peers 21.20   SWK 1.46 Peers 1.17

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

SWK is trading at a discount to its peers.

 

Premium. 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.

SWK trades at a premium to its peers.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
SWK 2.75 Peers 5.84   SWK 20.93 Peers 14.93

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.

SWK is trading at a significant discount to its peers.

 

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

SWK 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
SWK 1.79 Peers 1.98   SWK 4.94 Peers 6.31

Average. 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.

SWK is trading at a valuation on par with its industry on this measurement.

 

Lower. A sales growth rate that trails the industry implies that a company is losing market share.

SWK trails its peers on the basis of sales growth

 

 

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