Pentair (NYSE: PNR) - American provider of solutions in the field of water supply. She is favored by the trend towards investment in American infrastructure. But her quotes rose too much in the absence of real achievements..
When creating the material, sources were used, inaccessible to users from the Russian Federation. We hope, Do you know, what to do.
What do they earn
Often, when reporting companies, the numbers are rounded up, therefore, the totals in graphs and tables may not converge.
The company produces goods and components in the field of water supply. According to the report, the company's revenue is divided as follows:
- Consumer Solutions - 58%. Equipment and components for swimming pools and water supply systems. Segment operating margin — 24,04% from its proceeds.
- Industrial technologies and flow directions - 42%. Technologies and components for fluid management. 40% segment revenue comes from irrigation and residential buildings, 30% - other companies and those, what infrastructure is served, and the remaining 30% accounted for by industrial companies. Segment operating margin — 12,92% from its proceeds. The pools themselves give approximately 41,6% sales of the company.
Company revenue by sales structure:
- Residential Properties - 62,3%.
- Industrial customers - 20%.
- Commercial real estate — 17,7%.
Revenue by country and region:
- USA - 66,66%.
- Western Europe - 12,43%.
- Developing countries - 14,16%.
- The developed countries, except USA, — 6,75%.
Arguments in favor of the company
Scoundrel all to the face. For the most part, the "pool" part of the company's business is focused on the reconstruction and maintenance of existing pools., so this part of the business, if not, will grow, it will be quite stable.
The construction sector is now experiencing a slowdown, what we wrote about in the DR Horton review, and there will be no insane demand for new pools - here you will have to wait a couple of years, when will sufficiently large-scale construction of new volumes of living space begin.
The most promising are the industrial segment of the company and commercial real estate.
In the case of industry, a big plus would be like the current industrial upswing in the US, requiring investment now, and the coming growth of investment in the renewal of fixed assets and infrastructure in the United States. In the case of commercial real estate, a large demand for the company can come from the corporate sector, investing in the protection of their possessions from hurricanes or in the elimination of the consequences of these hurricanes, which we discussed in a recent bundle of investment news.
What can get in the way
Concentration. According to company report, Pool gives 15% Pentair's revenue. Review of relations with this company may negatively affect Pentair's reporting.
Everything. The cost of labor and the rise in the price of raw materials, as well as logistical problems - all this can have an extremely negative impact on the company's reporting. AND, probably, will be reflected.
Accounting. The company pays 80 cents of dividends per share per year - approximately 1,1% per annum. I do not think, that the dividend yield is below the average for S&P 500 c 1,3% per annum will attract a crowd of investors to these shares.
The company spends about $ 133 million on dividends a year - about 27,7% from her profits for the past 12 Months. It's not like crazy much, but should be taken into account, that Pentair has a considerable amount of debt: 2,083 billion, of which 931.1 million must be repaid during the year. Not much money at the disposal of the company: 95,9 million on accounts and 435.3 million debts of counterparties. So there are risks, that dividends will be cut and shares will fall from this.
Unreasonable growth. The main problem of the issuer is the unjustified growth of shares. Over the past two years, quotes have grown by almost 100%. The growth of the company's financial indicators during this very time was much more modest., which suggests that, that stocks are slightly overvalued. P / E of the company is not very large, but not small 25,47.
Resume
This is a very interesting issuer, the impression of which greatly spoils the dynamics of quotations. One gets the impression, that all the positive points, about which I spoke, according to investors, included in the price, therefore, I do not see any prerequisites for serious growth in the next year or two. However, I could be wrong, that's why, may be, here you can win back the growth of investments in the reconstruction of the US water infrastructure in the long run.
