Taylor Devices, Inc. (NASDAQ: TAYD)

Sector: Industrials Industry: Specialty Industrial Machinery CIK: 0000096536
Market Cap 265.09 Mn
P/B 3.95
P/E 26.81
P/S 5.56
ROIC (Qtr) 11.82
Div Yield % 0.00
Rev 1y % (Qtr) 35.73
Total Debt (Qtr) 0.00
Debt/Equity (Qtr) 0.00
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About

Investment thesis

Bull case

  • Operating cash flow of 17.19M provides strong 13.31x coverage of stock compensation 1.29M, indicating sustainable incentive practices.
  • Strong operating cash flow of 17.19M provides 1.54x coverage of SG&A expenses 11.17M, showing efficient operational cost management.
  • Robust free cash flow of 14.07M exceeds capital expenditure of 3.12M by 4.50x, indicating strong organic growth funding capability.
  • Tangible assets of 72.58M provide exceptional 44.76x coverage of deferred revenue 1.62M, showing strong service capability backing.
  • Operating cash flow of 17.19M provides strong 10.60x coverage of deferred revenue 1.62M, indicating service delivery capability.

Bear case

  • Operating cash flow of 17.19M barely covers its investment activities of (17.67M), with a coverage ratio of -0.97, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • With cash reserves of 1.96M against inventory of 9.03M, the 0.22 cash-to-inventory ratio suggests potential liquidity risks if inventory turnover slows, particularly concerning given current supply chain volatilities.
  • Investment activities of (17.67M) provide weak support for R&D spending of 567073, which is -31.16x, suggesting potentially insufficient investment in innovation relative to other capital deployment.
  • Short-term investments of 38.79M significantly exceed cash reserves of 1.96M, which is 19.83x, indicating potentially excessive yield-seeking behavior at the expense of liquidity.
  • R&D investment of 567073 represents just 0.05x of SG&A expenses of 11.17M, indicating potential underinvestment in innovation relative to administrative overhead.

Peer comparison

Companies in the Specialty Industrial Machinery
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 GEV GE Vernova Inc. 224.93 Bn 194.57 6.14 0.00 Bn
2 ETN Eaton Corp plc 153.13 Bn 38.99 5.75 11.22 Bn
3 PH Parker-Hannifin Corp 135.87 Bn 165.29 12.09 9.87 Bn
4 EMR Emerson Electric Co 111.68 Bn 47.10 4.65 13.41 Bn
5 ITW Illinois Tool Works Inc 86.68 Bn 28.27 5.40 8.97 Bn
6 CMI Cummins Inc 82.13 Bn 28.89 2.44 7.55 Bn
7 AME Ametek Inc/ 53.79 Bn 36.34 7.27 2.28 Bn
8 ROK Rockwell Automation, Inc 43.80 Bn 44.24 5.11 3.68 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 3.61 2.28
EV to Cash from Ops. EV/CFO 15.30 37.14
EV to Debt EV to Debt 0.00 34.39
EV to EBIT EV/EBIT 25.33 27.71
EV to EBITDA EV/EBITDA 21.81 25.34
EV to Free Cash Flow [EV/FCF] EV/FCF 18.69 133.36
EV to Market Cap EV to Market Cap 0.99 1.04
EV to Revenue EV/Rev 5.52 39.88
Price to Book Value [P/B] P/B 3.95 6.22
Price to Earnings [P/E] P/E 26.81 143.63
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Dividend Coverage Ratio 0.00 2.57
Dividend Payout Ratio % Div Payout % (Qtr) 0.00 15.73
Dividend per Basic Share Div per Share (Qtr) 0.00 0.91
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 0.00 82.53
Interest Coverage Int. cover (Qtr) -7.40 12.34
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) -66.53 -45.99
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) -16.95 118.48
Dividend Growth (1y) % Dividend Growth (1y) % 0.00 10.01
EBIAT Growth (1y) % EBIAT 1y % (Qtr) 13.01 -283.03
EBITDA Growth (1y) % EBITDA 1y % (Qtr) 9.74 -36.87
EBIT Growth (1y) % EBIT 1y % (Qtr) 11.67 -80.72
EBT Growth (1y) % EBT 1y % (Qtr) 9.90 -120.93
EPS Growth (1y) % EPS 1y % (Qtr) 13.67 -39.22
FCF Growth (1y) % FCF 1y % (Qtr) 2,742.77 85.55
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) 4.53 0.87
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 0.65 0.62
Cash Payout Ratio Cash Payout (Qtr) 0.00 0.10
Cash Ratio Cash Ratio (Qtr) 0.34 3.01
Current Ratio Curr Ratio (Qtr) 10.02 4.97
Debt to Equity Ratio Debt/Equity (Qtr) 0.00 0.38
Interest Cover Ratio Int Coverage (Qtr) -7.40 12.34
Times Interest Earned Times Interest Earned (Qtr) -7.40 12.34
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 25.60 -7,291.27
EBIT Margin % EBIT Margin % (Qtr) 21.78 -7,413.30
EBT Margin % EBT Margin % (Qtr) 24.73 -9,015.79
Gross Margin % Gross Margin % (Qtr) 46.10 -32.61
Net Profit Margin % Net Margin % (Qtr) 20.80 -7,962.06