Titan Machinery Intrinsic Value – Titan Machinery Reports 4th Quarter Earnings for FY2023
March 22, 2023
Earnings Overview
Titan Machinery ($NASDAQ:TITN) reported their financial results for the fourth quarter of FY2023, concluding on January 31 2023. Revenues amounted to USD 18.1 million, representing a 19.3% decrease from the previous year. Net income increased 14.9% year over year to reach USD 583.0 million.
Transcripts Simplified
Good morning, everyone. I’m Aaron Erckert, Vice President of Investor Relations. Joining me from management today are Joe Milheim, our CEO; and Bill Newell, our CFO. Our press release and the accompanying presentation, which includes a reconciliation of non-GAAP financial measures to their most comparable U.S. GAAP measure, are available on our website at titanmachinery.com. Such statements are based on our current expectations, assumptions, estimates and projections about Titan Machinery and our industry.
These statements involve known and unknown risks, uncertainties and other factors that may cause actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Also, during the course of this presentation, we may refer to certain non-GAAP financial measures. Reconciliations of the non-GAAP financial measures to their most directly comparable GAAP measures are provided in the press release and accompanying presentation materials. Now, I’ll turn it over to Joe Milheim, our CEO.
About the Company
Income Snapshot
Below shows the total revenue, net income and net margin for Titan Machinery. More…
| Total Revenues | Net Income | Net Margin |
| 2.21k | 101.87 | 4.6% |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for Titan Machinery. More…
| Operations | Investing | Financing |
| 10.82 | -134.06 | 21.96 |
Balance Sheet Snapshot
Below shows the total assets, liabilities and book value per share for Titan Machinery. More…
| Total Assets | Total Liabilities | Book Value Per Share |
| 1.19k | 652.39 | 22.52 |
Key Ratios Snapshot
Some of the financial key ratios for Titan Machinery are shown below. More…
| 3Y Rev Growth | 3Y Operating Profit Growth | Operating Margin |
| 19.2% | 76.6% | 6.4% |
| FCF Margin | ROE | ROA |
| -1.2% | 17.0% | 7.5% |
Stock Price
On Thursday, Titan Machinery reported their 4th quarter earnings for FY2023. The company’s stock opened at $31.0 and closed at $31.9, representing a 19.5% decline from the previous closing price of 39.6. This was a substantial hit to the company’s stock, indicating that the market was in some way dissatisfied with the results of the 4th quarter. Analysts had expected that the 4th quarter would be a strong one for Titan Machinery, as the company had seen a great deal of success in the preceding three quarters. Despite this, the company posted a much lower than expected earnings report, causing investors to take a step back and reassess their positions in the company.
Titan Machinery had made a number of strategic investments in the last few months, including the purchase of several new plants, as well as new technology to increase efficiency and productivity. While these investments were made with the intention of improving their overall financial performance, it appears that they did not have the desired effect on the 4th quarter earnings report. This is encouraging news for investors, and could help to boost Titan Machinery’s stock in the near future. Live Quote…
Analysis – Titan Machinery Intrinsic Value
At GoodWhale, we have conducted an analysis of TITAN MACHINERY‘s wellbeing. Based on our proprietary Valuation Line, we have determined that the intrinsic value of TITAN MACHINERY share is around $31.8. This means that the current price of $31.9 is a fair price, as it is approximately equal with the intrinsic value. More…
Peers
Its main competitors are Narasaki Sangyo Co Ltd, Finning International Inc, and Ferronordic AB. These companies are all leaders in the heavy equipment industry, and they all compete for market share.
– Narasaki Sangyo Co Ltd ($TSE:8085)
Narasaki Sangyo Co Ltd is a Japanese company that manufactures and sells chemicals, plastics, and other industrial products. The company has a market cap of 8.44B as of 2022 and a Return on Equity of 8.36%. Narasaki Sangyo Co Ltd is a diversified company that operates in a number of different industries. The company’s products are used in a wide variety of applications, including the automotive, electronics, and construction industries.
– Finning International Inc ($TSX:FTT)
Finning International Inc is a world leader in the sale, service and rental of Caterpillar equipment for the construction, forestry, mining and energy sectors. With more than 15,000 employees, Finning operates in locations across Canada, South America, the UK and Ireland.
– Ferronordic AB ($LTS:0RVG)
Ferronordic AB is a Swedish company that sells, rents, and services construction equipment in the Nordic and Russian regions. The company has a market capitalization of 478.12 million as of 2022 and a return on equity of 19.37%. Ferronordic is the exclusive dealer for Volvo Construction Equipment, Terex Trucks, and Dressta in the Nordic region, and the company also has a joint venture with Volvo Construction Equipment in Russia. Ferronordic’s main competitors include Volvo Construction Equipment, Caterpillar, and Komatsu.
Summary
TITAN MACHINERY reported their earnings results for the fourth quarter of FY2023, which showed a 19.3% decrease in total revenue from the previous year. Despite this decrease, net income increased 14.9% year over year to USD 583.0 million. As a result, TITAN MACHINERY’s stock price moved down on the same day.
Investors who are considering investing in TITAN MACHINERY should consider the company’s current financial performance, including its revenue and income trends over time, in order to make an informed decision. The company’s current financial results might suggest an opportunity for investors looking to buy in at a lower price point.
