SNA - Embedded Expectations Analysis - 2019 05 07
Snap-on Incorporated (SNA:USA) currently trades near historical averages relative to UAFRS-based (Uniform) Earnings, with a 14.1x Uniform P/E. At these levels, the market has bearish expectations for the firm, and management is concerned about tool storage and diagnostic product sales growth, product capabilities, and Tools Group margins.Specifically, management may lack confidence in their ability to sustain tool storage and diagnostic products sales growth, financial services operating earnings and portfolio growth, and improvements in days sales outstanding. In addition, they may be concerned about market opportunities in critical industries, their Triton motorcycle diagnostics tool launch, and Sturtevant Richmont BLE system aerospace capabilities. Furthermore, they may be exaggerating opportunities in technician education facilities, their Tools Group's innovation and value creation competencies, and the utility of their Apollo handheld, Thermal Imager Elite, and p1000 motorcycle diagnostics tool. Finally, they may be downplaying concerns about last generation product margin headwinds, and may lack confidence in their ability to sustain Tools Group margins.
Snap-on is a manufacturer and marketer of tools, equipment, diagnostics, repair information and systems solutions. Products and services include hand and power tools, tool storage, diagnostics software, handheld and PC-based diagnostic products, information and management systems, shop equipment and other solutions for vehicle dealerships and repair centers, as well as for customers in industries, such as aviation and aerospace, agriculture, construction, government and military, mining, natural resources, power generation and technical education. The company also provides financing programs designed to facilitate the sales of its products and support its franchise business.
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