TTC - Embedded Expectations Analysis - 2021 02 25
The Toro Company (TTC:USA) currently trades at a historical high relative to UAFRS-based (Uniform) earnings, with a 26.9x Uniform P/E. At these levels, the market has bullish expectations for the firm, but management may be concerned about their productivity and synergy initiatives, landscape contractor demand, and mower shipment improvementsSpecifically, management may lack confidence in their ability to meet their 3-year net sales targets, further execute their productivity and synergy initiatives, and sustain EPS growth. Furthermore, they may have concerns about municipal ground equipment spending constraints and the sustainability of landscape contractor demand, and they may be exaggerating the strength of their current liquidity position. Finally, management may lack confidence in their ability sustain incremental shipment improvement of their zero-turn riding and walk power mowers
Toro designs, manufactures, and markets turf maintenance equipment and services, turf irrigation systems, landscaping equipment and lighting products, snow and ice management products, agricultural irrigation systems, rental and underground construction equipment, and residential yard and snow thrower products. The company's segments include: Professional, which markets its products worldwide through a network of distributors and dealers, as well as directly to government customers, rental companies, and retailers; and Residential, which markets its products to homeowners through outdoor power equipment distributors and dealers, mass retailers, hardware retailers, home centers, as well as online.
In 2009, just as the dust was settling from the last major equity and credit market crises, we launched a boutique research firm with the intention of breaking Wall Street’s biases and broken incentives:
- GAAP and IFRS have failed to provide rules for reliable financial statement reporting
- Stock analyst recommendations are not grounded in disciplined financial analysis
- Credit agencies have been set up to grossly fail in their responsibilities to investors and the public markets
- Utter lack of willingness of major research firms to employ the the most advanced forensic analysis available
We sought to provide investors and company analysts with a source of information that changed all that.
Many years later, our business model remains because little has changed on Wall Street.
- Corporate credit ratings remain years behind the fundamental underpinnings of company performance
- Stock analysts continue to make recommendations with deeply inherent biases
- Research firms have failed to break down the walls between credit, equity, and macroeconomic research
- The governing accounting bodies have created more leeway for mis-estimates and mis-classifications as financials have become unwieldy and overwhelming
The integrity of Valens Research is founded in our disciplined processes and analytics. No “star” analysts. No corporate advisory relationships. No-nonsense opinions and recommendations.
Unfortunately, this report is not available for the investor type or country you selected.
Browse all ResearchPool reportsReport is subscription only.
Thank you, your report is ready.
Thank you, your report is ready.