ITT Inc.'s (NYSE:ITT) Stock Is Going Strong: Is the Market Following Fundamentals?
ITT Inc.'s (NYSE:ITT) Stock Is Going Strong: Is the Market Following Fundamentals?
Most readers would already be aware that ITT's (NYSE:ITT) stock increased significantly by 25% over the past three months. Since the market usually pay for a company's long-term fundamentals, we decided to study the company's key performance indicators to see if they could be influencing the market. In this article, we decided to focus on ITT's ROE.
大多數讀者已經意識到,ITT(紐約證券交易所代碼:ITT)的股票在過去三個月中大幅上漲了25%。由於市場通常會爲公司的長期基本面買單,因此我們決定研究公司的關鍵績效指標,看看它們是否會影響市場。在本文中,我們決定重點介紹ITT的投資回報率。
ROE or return on equity is a useful tool to assess how effectively a company can generate returns on the investment it received from its shareholders. In simpler terms, it measures the profitability of a company in relation to shareholder's equity.
投資回報率或股本回報率是評估公司如何有效地從股東那裏獲得投資回報的有用工具。簡而言之,它衡量公司相對於股東權益的盈利能力。
How To Calculate Return On Equity?
如何計算股本回報率?
The formula for return on equity is:
股本回報率的公式是:
Return on Equity = Net Profit (from continuing operations) ÷ Shareholders' Equity
股本回報率 = 淨利潤(來自持續經營業務)÷ 股東權益
So, based on the above formula, the ROE for ITT is:
因此,根據上述公式,ITT的投資回報率爲:
18% = US$438m ÷ US$2.4b (Based on the trailing twelve months to September 2023).
18% = 4.38億美元 ÷ 24億美元(基於截至2023年9月的過去十二個月)。
The 'return' is the yearly profit. That means that for every $1 worth of shareholders' equity, the company generated $0.18 in profit.
“回報” 是每年的利潤。這意味着,每持有價值1美元的股東權益,公司就會產生0.18美元的利潤。
What Is The Relationship Between ROE And Earnings Growth?
投資回報率與收益增長之間有什麼關係?
Thus far, we have learned that ROE measures how efficiently a company is generating its profits. Depending on how much of these profits the company reinvests or "retains", and how effectively it does so, we are then able to assess a company's earnings growth potential. Assuming all else is equal, companies that have both a higher return on equity and higher profit retention are usually the ones that have a higher growth rate when compared to companies that don't have the same features.
到目前爲止,我們已經了解到,投資回報率衡量的是公司創造利潤的效率。然後,我們能夠評估公司的收益增長潛力,具體取決於公司對這些利潤進行再投資或 “保留” 了多少及其有效性。假設其他條件都一樣,與功能不相同的公司相比,具有更高股本回報率和更高利潤保留率的公司通常具有更高的增長率。
ITT's Earnings Growth And 18% ROE
ITT的收益增長和18%的投資回報率
To begin with, ITT seems to have a respectable ROE. On comparing with the average industry ROE of 15% the company's ROE looks pretty remarkable. Probably as a result of this, ITT was able to see a decent growth of 8.4% over the last five years.
首先,ITT的投資回報率似乎相當不錯。與15%的行業平均投資回報率相比,該公司的投資回報率看起來相當可觀。可能正因爲如此,ITT在過去五年中得以實現8.4%的可觀增長。
Next, on comparing ITT's net income growth with the industry, we found that the company's reported growth is similar to the industry average growth rate of 8.8% over the last few years.
接下來,在將ITT的淨收入增長與該行業進行比較時,我們發現該公司報告的增長與過去幾年8.8%的行業平均增長率相似。
![past-earnings-growth](https://usnewsfile.moomoo.com/public/MM-PersistNewsContentImage/7781/20240203/0-57c587c1d4fd5ff223d6d7916350fc7f-0-0fa2112246d8bebc2499ab314c89541c.png/big)
The basis for attaching value to a company is, to a great extent, tied to its earnings growth. It's important for an investor to know whether the market has priced in the company's expected earnings growth (or decline). This then helps them determine if the stock is placed for a bright or bleak future. Has the market priced in the future outlook for ITT? You can find out in our latest intrinsic value infographic research report.
爲公司附加價值的基礎在很大程度上與其收益增長息息相關。對於投資者來說,重要的是要知道市場是否對公司的預期收益增長(或下降)進行了定價。然後,這可以幫助他們確定股票是爲光明還是暗淡的未來而佈局。市場對ITT的未來展望進行了定價嗎?你可以在我們最新的內在價值信息圖研究報告中找到答案。
Is ITT Using Its Retained Earnings Effectively?
ITT是否有效地使用了其留存收益?
ITT's three-year median payout ratio to shareholders is 24% (implying that it retains 76% of its income), which is on the lower side, so it seems like the management is reinvesting profits heavily to grow its business.
ITT的三年股東派息率中位數爲24%(這意味着它保留了收入的76%),處於較低水平,因此管理層似乎正在大量再投資利潤以發展業務。
Moreover, ITT is determined to keep sharing its profits with shareholders which we infer from its long history of paying a dividend for at least ten years. Upon studying the latest analysts' consensus data, we found that the company's future payout ratio is expected to drop to 16% over the next three years. Despite the lower expected payout ratio, the company's ROE is not expected to change by much.
此外,ITT決心繼續與股東分享利潤,這是我們從其支付股息的長期歷史中推斷出來的。在研究了分析師的最新共識數據後,我們發現該公司的未來派息率預計將在未來三年降至16%。儘管預期派息率較低,但該公司的投資回報率預計不會有太大變化。
Summary
摘要
On the whole, we feel that ITT's performance has been quite good. Specifically, we like that the company is reinvesting a huge chunk of its profits at a high rate of return. This of course has caused the company to see substantial growth in its earnings. On studying current analyst estimates, we found that analysts expect the company to continue its recent growth streak. To know more about the latest analysts predictions for the company, check out this visualization of analyst forecasts for the company.
總的來說,我們認爲ITT的表現相當不錯。具體而言,我們喜歡該公司以高回報率再投資其利潤的很大一部分。當然,這導致該公司的收益大幅增長。在研究分析師當前的估計時,我們發現分析師預計該公司將繼續保持最近的增長勢頭。要詳細了解分析師對公司的最新預測,請查看該公司的分析師預測的可視化。
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
對這篇文章有反饋嗎?對內容感到擔憂?直接聯繫我們。 或者,給編輯團隊 (at) simplywallst.com 發送電子郵件。
Simply Wall St的這篇文章本質上是籠統的。我們僅使用公正的方法根據歷史數據和分析師的預測提供評論,我們的文章無意作爲財務建議。它不構成買入或賣出任何股票的建議,也沒有考慮到您的目標或財務狀況。我們的目標是爲您提供由基本數據驅動的長期重點分析。請注意,我們的分析可能不考慮最新的價格敏感型公司公告或定性材料。簡而言之,華爾街沒有持有任何上述股票的頭寸。