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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
Csw Industrials, Inc. (XNAS:CSWI) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
CSWI
Name:
CSW INDUSTRIALS, INC. (XNAS:CSWI)
Sector:
17.85M
Industry:
Specialty Industrial Machinery
CEO:
Mr. Joseph Armes
Total Employees:
2,400
Our Technological Advancement Rating
Our Rating:
B
Technological advancement compared to industry is -6.69% lower
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF CSW INDUSTRIALS, INC.(CSWI) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND SPECIALTY INDUSTRIAL MACHINERY INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
126.48
One Month Price Target:
$127.06
Six Month Price Target :
$129.94
Likely Price in One Year's Time:
Ticker:
$133.4
Likely Trading Range Today Under (Normal Volatility)
$126.1
Price Upper limit ($) :
$127.11
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$120.5
This week:
$113.11
This month :
$99.75
Other Primary facts
Market Cap:
1.96B
Market Cap Classification:
Small Cap
Number of Shares
IPO Date:
15.43M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
15.79%
-15.67%
Worst Daily Decline:
Our Options Trading Entry Points
Iron Condor entry points for options expiring in 1 week's time
Low risk (<2%) entry points
Buy Call:
Sell Call:
Buy Put:
Sell Put:
$154.19
$141.30
$98.77
$111.66
Medium risk (<10%) entry points
Buy Call
Sell Call
$137.11
Buy Put:
Sell Put:
$134.35
$115.82
$118.61
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
CSWI
Sharpe Ratio:
3.97%
Comparison:
CSWI, is amongst the top 20% stocks with highest risk-adjusted returns
Sharpe ratio is 109.69% higher than the industry
& ratio is 74.31% higher than the market/S&P 500 average
Average Returns/Yield of
CSWI
Daily returns:
0.10%
Weekly returns:
0.51%
Monthly returns:
2.05%
Yearly returns:
16.25%
Comparison of returns:
Average annual returns/yield (last 3 years) is 51.03% above industry average
Classification:
CSWI, is amongst the top 20% highest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.32
Statistical test of Returns:
CSWI has yielded returns statistically similar to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
2.35%
Weekly Volatility:
5.26%
Monthly Volatility:
10.51%
Yearly Volatility:
36.42%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
0.93%
Volatility in last five trading days has been -60.43% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-4.73%
Weekly VaR:
-10.57%
Monthly VaR:
-21.13%
How Much Can the price of
CSWI
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-18%
Worst case (decline):
-73.21%
This translates to price declining to:
$104.33
This translates to price declining to:
$33.88
Severe Crash Probability
Risk of crash in next 6/12 months: Very high (>70%)
What is Value at Risk (VaR)?
Risk Fundamentals
CSWI is a 49.17% riskier investment compared to the market/S&P 500 & is 27.79% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is -14.07% below industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
CSWI
Beta in relation to market/S&P 500--0.81
Expected beta in 1 year's time:
0.678
Expected beta in 3 year's time:
0.959
Unlevered (debt free) Beta:
0.585
Beta in relation to Nasdaq (XNAS):
0.541
Beta in relation to all global stocks::
0.839
Beta Comparison & Analysis
Beta of competitors/peers::
1.236
Beta is -34.08% lower than peers
Average Industry Beta:
1.281
Beta is -36.42% below industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
10.63%
Sustainable growth rate is -28.63% below industry average
Alpha provided | Alpha Analysis
Alpha provided:
0.158
Alpha is 265.90% above industry average alpha yield
Alpha is 1006% higher than market/& is unsustainably high
Analysis of Cost of Capital of
CSWI
Equity cost of capital:
0.087
Equity cost of capital is -26.80% below industry mean WACC
Unlevered (without debt) cost of capital:
6.26%
Before-tax cost of debt:
2.36%
After-tax cost of debt:
1.86%
Overall debt rating:
Highest AAA investment grade
Weighted average cost of capital (WACC):
1.86%
WACC is -81.98% below industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$40.61
Revenue growth rate per share of (3Y):
4.53
Annual revenue growth rate is 66.05% above the industry average
EPS:
-$0.31
Expected Annual growth rate of EPS (3Y):
6.15%
Expected future EPS growth rate is 101.52% higher than the Specialty Industrial Machinery industry
Free cash flow (FCF) per share:
$3.33
-
-
Debt per share
$14.95
EBITDA per share
$8.61
Valuation Analysis Today of
CSWI
P/E Ratio:
26.36
P/E Ratio of Competitors/Peers:
32.64
P/E ratio is -19.24% lower than main peers & is -4.21% lower than the industry
-
CSWI is -1582.87% undervalued if valued using industry average P/E ratio
Share value as per dividend discount (DDM) model: $23.92
Present value of the expected future dividends only: $10.10
P/S (Price to Sales ratio):
3.11
Price to sales ratio is -24.93% below the industry mean
P/B (Price to book value ratio):
4.53
Price to free cash flow: 37.97
-
Net income growth rate (3Y):
-453.46%
Net income growth rate is -33789.30% lower than the industry average net income growth rate
Dividend Analysis
Dividend payout rate: 3.55%
Dividend yeild: 0.49%
Previous Dividend: $0.17
Previous adjusted dividend: $0.17
Previous Dividend: $0.62
Expected next dividend best case: $0.18
Expected next dividend worst case: $0.16
Average dividend payment (long-term): $0.14
Average dividend increase/decrease (growth rate) % per period: 2.44%
Expected next dividend payment date: 08/11/2022
Expected next dividend record date: 28/07/2022
Expected next dividend declaration date: 13/07/2022
Previous dividend payment date: 13/05/2022
Previous dividend record date: 29/04/2022
Previous dividend declaration date: 14/04/2022
Dividend History:
2022-04-28--$0.17
2021-10-28--$0.15
2021-04-29--$0.15
2022-01-28--$0.15
2021-07-28--$0.15
2021-01-28--$0.14
Dividend growth rate is -30.03% lower than the industry average
In-depth Debt & Leverage Analysis
Debt to equity ratio:
53.50%
Net debt to equity ratio:
49.99%
Debt to assets ratio:
25.51%
Net debt to assets ratio:
23.83%
Debt-to-asset ratio is -52.73% below industry average
Ability to repay debt:
Interest coverage ratio:
24.38
Interest coverage ratio is 24.92% more than industry average
Looking forward:
Debt growth rate:
2100.87%
Annual debt growth is 2715% higher than industry average debt growth rate
Debt repayment rate in last quarter: 9.12%
Analysis of Key Statistics
Correlation of price movement with the market:
0.496
Statistical significance of correlation:
CSWI has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.635
Stock price is -21.89% less correlated with the market compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.635
Correlation of price movement with Nasdaq (^IXIC):
-0.024
Covariance of price movement with the market:
-0.032
Kurtosis
8.95
Returns have a significant fat-tails (leptokurtic), i.e., returns considerably higher or lower than the mean returns are more probable, compared to assets with normally distributed returns
Skewness of returns:
0.351
Returns are, approximately, symmetrical
Fundamental Analysis & Dupont Analysis of
CSWI
Gross Profit Margin Ratio:
163%
Operating Profit Margin Ratio:
15.55%
Operating profit margin is -164.19% lower than the industry
Net Profit Margin Ratio:
163%
Effective Tax Rate:
26.40%
Effective tax rate is 41.27% higher than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
15.40%
Return on equity (ROE) is 358.28% higher than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
7.34%
Return on assets (ROA) is 56.43% higher than the industry
Financial Leverage:
1.3x
Current Ratio:
2.65
Current ratio is -12.42% below industry average
Cash Conversion Cycle (days):
48
Cash conversion cycle is -21.96% below industry average
The remaining useful life of property plant & equipment is: 6.8 years
Stock based compensation to net income ratio:
2.84%
In-depth Efficiency Analysis
Revenue generated per employee:
261.0K
Each employee generates -93% less revenue than industry average revenue per employee
EBITDA generated per employee:
55.4K
Each employee generates -93% less EBITDA than industry average revenue per employee
Profit generated per employee:
27.7K
Each employee generates -93% less net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
7.4K
Each employee generates -85% less free cash flow than industry average revenue per employee
Assets/Capital per employee
275.7K
Each employee generates -85% less free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
-
-
Competitors/Peer firms of
CSWI
HEADHUNTER GROUP PLC (XNAS:HHR)
ATLAS AIR WORLDWIDE HOLDINGS, INC. (XNAS:AAWW)
HWCPL
MCGRATH RENTCORP (XNAS:MGRC)
STAR BULK CARRIERS CORP. (XNAS:SBLK)
ARCBEST CORPORATION (XNAS:ARCB)
PATRICK INDUSTRIES, INC. (XNAS:PATK)
SUN COUNTRY AIRLINES HOLDINGS, INC. (XNAS:SNCY)
VERRA MOBILITY CORPORATION (XNAS:VRRM)
Current Analyst Ratings
Strong buy�0%
Buy�8%
Hold�0%
Sell�0%
Strong sell�0%
Overall analyst sentiment is: Buy
Income Statement
Period:
TTM
Date:
3/31/22
Revenue:
626.44M
Cost of Revenue:
Gross Profit:
R&D Expense
General & Admin Expenses:
Selling, General & Admin Expenses
Sales and Marketing Expenses
Other Expenses :
Operating Expenses :
Cost & Expenses :
Interest Income:
Interest Expenses:
Depreciation & Amortization:
EBITDA:
Operating Income:
Other Income Expenses:
Income Before Tax:
Income Tax Expense:
Net Income:
Balance Sheet
Date:
Calendar Year:
Period:
Cash & Cash Equivalents:
Short Term Investments:
Cash & Short Term Investments:
Net Receivables:
Inventory:
Other Current Assets:
Total Current Assets:
PP&E:
Goodwill:
Intangible Assets:
Long Term Investments:
Tax Assets:
Other Non-Current Assets:
Total Non-Current Assets:
Other Assets:
Total Assets:
Accounts Payable:
Short Term Debt:
Tax Payables:
Deferred Revenue:
Other Current Liabilities:
Total Current Liabilities:
Long Term Debt:
Other Non-Current Liabilities:
Total Non Current Liabilities:
Other Liabilities:
Total Liabilities:
Common Stock:
Retained Earnings:
Accumulated Other Comprehensive Loss:
Other Total Stockholders' Equity:
Total Stockholders' Equity:
Total Liabilities and Stockholders' Equity:
Total Investments:
Total Debt:
Net Debt:
370.47M
255.96M
-
-
158.58M
-
-
158.58M
-
5.45M
36.89M
132.87M
97.38M
66.39M
91.46M
24.14M
66.39M
Statement of Cash Flow
Date:
Period:
12.29M
Differed Income Tax :
81.00K
Stock Based Compensation :
1.89M
Change in Working Capital :
- 16183.00K
Accounts Receivables:
- 16164.00K
Other Working Capital:
226.00K
Other Non-Cash Items:
801.00K
Net Cash Provided by Operating Activities:
18.93M
Investments in PP&E:
-
Net Acquisitions:
1.38M
Purchases of Investments:
-
Sales/Maturities of Investments:
Other Investing Activities:
Net Cash Used for Investing Activities:
Debt Repayment:
Common Stock Issued:
Common Stock Repurchased:
Dividend Paid:
Other Financing Activities:
Net Cash Used Provided by Financing Activities:
Effect of FOREX on Changes in Cash:
Net Changes in Cash:
Cash at End of Period:
Cash at Beginning of Period:
Operating Cash Flow:
Capital Expenditure:
Free Cash Flow (FCF):
6/30/21
2022
Q1
15.68M
-
15.68M
111.94M
105.01M
10.05M
242.67M
80.66M
218.93M
286.06M
-
-
75.92M
661.57M
-
904.24M
43.23M
561.00K
-
-
47.94M
91.73M
230.64M
150.76M
381.40M
-
473.12M
161.00K
364.91M
- 5609.0K
71.66M
June 30, 2021 at 6:00:00 AM
529.06M
431.12M
904.24M
-
231.20M
215.5M
-
- 1071.00K
304.00K
- 23140.00K
-
- 3168.00K
- 2358.00K
14.97M
- 13701.00K
57.00K
5.59M
15.68M
10.09M
18.93M
- 1079.00K
17.85M
Our Proprietary Portfolio Rating
Our Rating:
B
Price Forecast/Expected Price in Next 5 Years of
CSWI
2023
2024
2025
2026
2027
$111.87
$118.00
$124.46
$131.27
$138.46