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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
Titan Machinery Inc. (XNAS:TITN) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
TITN
Name:
TITAN MACHINERY INC. (XNAS:TITN)
Sector:
17.83M
Industry:
Industrial Distribution
CEO:
Mr. David Meyer
Total Employees:
2,288
Our Technological Advancement Rating
Our Rating:
D
Technological advancement compared to industry is -488.05% lower
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF TITAN MACHINERY INC.(TITN) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND INDUSTRIAL DISTRIBUTION INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
30.33
One Month Price Target:
$30.61
Six Month Price Target :
$31.99
Likely Price in One Year's Time:
Ticker:
$33.65
Likely Trading Range Today Under (Normal Volatility)
$30.2
Price Upper limit ($) :
$30.57
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$28.16
This week:
$25.48
This month :
$20.62
Other Primary facts
Market Cap:
679.75M
Market Cap Classification:
Small Cap
Number of Shares
IPO Date:
22.57M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
23.9%
-20.04%
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:
$40.39
$35.70
$20.27
$24.96
Medium risk (<10%) entry points
Buy Call
Sell Call
$34.17
Buy Put:
Sell Put:
$33.17
$26.48
$27.49
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
TITN
Sharpe Ratio:
4.67%
Comparison:
TITN, is amongst the top 20% stocks with highest risk-adjusted returns
Sharpe ratio is 51.58% higher than the industry
& ratio is 104.88% higher than the market/S&P 500 average
Average Returns/Yield of
TITN
Daily returns:
0.18%
Weekly returns:
0.88%
Monthly returns:
3.51%
Yearly returns:
22.00%
Comparison of returns:
Average annual returns/yield (last 3 years) is 91.56% above industry average
Classification:
TITN, is amongst the top 20% highest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.37
Statistical test of Returns:
TITN has yielded returns statistically similar to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
3.57%
Weekly Volatility:
7.98%
Monthly Volatility:
15.97%
Yearly Volatility:
55.31%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
1.88%
Volatility in last five trading days has been -47.23% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-7.16%
Weekly VaR:
-16.00%
Monthly VaR:
-32.01%
How Much Can the price of
TITN
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-26%
Worst case (decline):
>85%
This translates to price declining to:
$22.36
This translates to price declining to:
$4.55
Severe Crash Probability
Risk of crash in next 6/12 months: Very high (>70%)
What is Value at Risk (VaR)?
Risk Fundamentals
TITN is a 125.90% riskier investment compared to the market/S&P 500 & is 93.53% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is 31.08% above industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
TITN
Beta in relation to market/S&P 500--1.63
Expected beta in 1 year's time:
0.878
Expected beta in 3 year's time:
1.242
Unlevered (debt free) Beta:
1.285
Beta in relation to Nasdaq (XNAS):
0.635
Beta in relation to all global stocks::
0.69
Beta Comparison & Analysis
Beta of competitors/peers::
1.48
Beta is 9.95% higher than peers
Average Industry Beta:
1.265
Beta is 28.62% above industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
11.41%
Sustainable growth rate is -32.26% below industry average
Alpha provided | Alpha Analysis
Alpha provided:
0.278
Alpha is 173.45% above industry average alpha yield
Alpha is 1772% higher than market/& is unsustainably high
Analysis of Cost of Capital of
TITN
Equity cost of capital:
0.143
Equity cost of capital is 20.99% above industry mean WACC
Unlevered (without debt) cost of capital:
11.29%
Before-tax cost of debt:
1.39%
After-tax cost of debt:
1.10%
Overall debt rating:
Highest AAA investment grade
Weighted average cost of capital (WACC):
1.10%
WACC is 5.02% above industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$79.77
Revenue growth rate per share of (3Y):
1.81
Annual revenue growth rate is 3.39% above the industry average
EPS:
$3.23
Expected Annual growth rate of EPS (3Y):
74.63%
Expected future EPS growth rate is 233.09% higher than the Industrial Distribution industry
Free cash flow (FCF) per share:
$4.63
-
-
Debt per share
$5.93
EBITDA per share
$5.47
Valuation Analysis Today of
TITN
P/E Ratio:
9.38
P/E Ratio of Competitors/Peers:
24.44
P/E ratio is -61.64% lower than main peers & is -63.70% lower than the industry
Stock price/value with industry average P/E ratio: $83.42
TITN is -63.64% undervalued if valued using industry average P/E ratio
-
-
P/S (Price to Sales ratio):
0.38
Price to sales ratio is -78.95% below the industry mean
P/B (Price to book value ratio):
1.81
Price to free cash flow: 6.55
-
Net income growth rate (3Y):
-369.10%
Net income growth rate is 1687.44% higher than the average industry net income growth rate
Dividend Analysis
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Dividend History:
--$0.00
--$0.00
--$0.00
--$0.00
--$0.00
--$0.00
-
In-depth Debt & Leverage Analysis
Debt to equity ratio:
35.32%
Net debt to equity ratio:
60.42%
Debt to assets ratio:
16.12%
Net debt to assets ratio:
27.57%
Debt-to-asset ratio is -62.78% below industry average
Ability to repay debt:
Interest coverage ratio:
27.76
Interest coverage ratio is -73.29% less than industry average
Looking forward:
Debt growth rate:
-30.04%
Annual debt growth is -243% lower than industry average debt growth rate
Debt repayment rate in last quarter: 2.32%
Analysis of Key Statistics
Correlation of price movement with the market:
0.384
Statistical significance of correlation:
TITN has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.554
Stock price is -30.61% less correlated with the market compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.554
Correlation of price movement with Nasdaq (^IXIC):
-0.007
Covariance of price movement with the market:
-0.014
Kurtosis
6.473
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:
0.697
Returns are right (positive) skewed; mean returns are greater than median and mode returns
Fundamental Analysis & Dupont Analysis of
TITN
Gross Profit Margin Ratio:
78%
Operating Profit Margin Ratio:
5.57%
Operating profit margin is -13.43% lower than the industry
Net Profit Margin Ratio:
78%
Effective Tax Rate:
24.55%
Effective tax rate is 23.14% higher than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
19.27%
Return on equity (ROE) is -25.47% lower than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
8.79%
Return on assets (ROA) is -11.21% lower than the industry
Financial Leverage:
1.2x
Current Ratio:
1.9
Current ratio is -23.85% below industry average
Cash Conversion Cycle (days):
40.3
Cash conversion cycle is 26.49% above industry average
The remaining useful life of property plant & equipment is: 18.5 years
Stock based compensation to net income ratio:
0.83%
In-depth Efficiency Analysis
Revenue generated per employee:
786.8K
Each employee generates 39% more revenue than industry average revenue per employee
EBITDA generated per employee:
53.9K
Each employee generates -15% less EBITDA than industry average revenue per employee
Profit generated per employee:
31.9K
Each employee generates -19% less net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
7.8K
Each employee generates -6376% less free cash flow than industry average revenue per employee
Assets/Capital per employee
105.8K
Each employee generates -6376% less free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
-
-
Competitors/Peer firms of
TITN
BARRETT BUSINESS SERVICES, INC. (XNAS:BBSI)
Tecnoglass Inc (XNYS:TGLS)
FSAC
EAGLE BULK SHIPPING INC. (XNAS:EGLE)
GEFEN INTERNATIONAL A.I. LTD (XASX:GFN)
THCAW
DXP ENTERPRISES, INC. (XNAS:DXPE)
RADA ELECTRONIC INDUSTRIES LTD (XNAS:RADA)
KIMBALL ELECTRONICS, INC. (XNAS:KE)
Current Analyst Ratings
Strong buy�4%
Buy�4%
Hold�8%
Sell�0%
Strong sell�4%
Overall analyst sentiment is: Hold
Income Statement
Period:
TTM
Date:
4/30/22
Revenue:
1.80B
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:
1.45B
350.44M
-
-
-
-
248.75M
248.75M
1.77M
4.45M
22.16M
123.41M
100.19M
73.04M
96.81M
23.77M
73.04M
Statement of Cash Flow
Date:
Period:
5.21M
Differed Income Tax :
- 1008.00K
Stock Based Compensation :
609.00K
Change in Working Capital :
8.84M
Accounts Receivables:
- 1023.00K
Other Working Capital:
- 9199.00K
Other Non-Cash Items:
2.76M
Net Cash Provided by Operating Activities:
26.96M
Investments in PP&E:
- 9126.00K
Net Acquisitions:
-
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):
4/30/21
2022
Q1
89.73M
-
89.73M
71.93M
415.66M
11.28M
588.59M
227.33M
1.43M
7.70M
-
4.61M
1.08M
242.15M
-
830.74M
24.62M
184.86M
14.51M
49.11M
51.62M
310.21M
133.90M
7.56M
141.45M
-
451.66M
-
127.42M
- 880.0K
-
April 30, 2021 at 6:00:00 AM
1.70B
379.08M
830.74M
-
318.76M
229.0M
-
142.00K
- 8984.00K
- 3181.00K
-
-
-
- 3653.00K
- 6834.00K
- 399.00K
10.74M
89.73M
78.99M
26.96M
- 9126.00K
17.83M
Our Proprietary Portfolio Rating
Our Rating:
D
Price Forecast/Expected Price in Next 5 Years of
TITN
2023
2024
2025
2026
2027
$33.82
$76.23
$84.57
$93.82
$104.08