Snap-on Inc (SNA, Financial) has recently been in the spotlight, drawing interest from investors and financial analysts due to its robust financial stance. With shares currently priced at $295.2, Snap-on Inc has witnessed a daily loss of 0.01%, marked against a three-month change of 5.97%. A thorough analysis, underlined by the GF Score, suggests that Snap-on Inc is well-positioned for substantial growth in the near future.
What Is the GF Score?
The GF Score is a stock performance ranking system developed by GuruFocus using five aspects of valuation, which has been found to be closely correlated to the long-term performances of stocks by backtesting from 2006 to 2021. The stocks with a higher GF Score generally generate higher returns than those with a lower GF Score. Therefore, when picking stocks, investors should invest in companies with high GF Scores. The GF Score ranges from 0 to 100, with 100 as the highest rank.
- Financial strength rank: 8/10
- Profitability rank: 10/10
- Growth rank: 9/10
- GF Value rank: 5/10
- Momentum rank: 8/10
With a high Financial Strength and Profitability rank, and a solid Growth rank, Snap-on Inc demonstrates a strong foundation for success. The GF Value rank, while moderate, suggests that the stock may be fairly valued at the current price. The Momentum rank indicates a positive trend in the stock's performance. GuruFocus assigned Snap-on Inc the GF Score of 95 out of 100, which signals the highest outperformance potential.
Understanding Snap-on Inc's Business
Snap-on Inc, with a market cap of $15.56 billion and sales of $5.1 billion, is a leading manufacturer of premium tools and software for repair professionals. The company's operating margin stands at a robust 25.65%. Snap-on Inc operates through three segments: repair systems and information, commercial and industrial, and tools. Its unique business model involves franchisee-operated mobile vans that sell tools directly to auto technicians. The company's finance arm supports franchisees with loans and leases for mobile vans, demonstrating a comprehensive approach to its operations.
Financial Strength Breakdown
According to the Financial Strength rating, Snap-on Inc's robust balance sheet exhibits resilience against financial volatility, reflecting prudent management of capital structure. The Interest Coverage ratio for Snap-on Inc stands impressively at 26.26, underscoring its strong capability to cover its interest obligations. With an Altman Z-Score of 6.81, Snap-on Inc exhibits a strong defense against financial distress, highlighting its robust financial stability. The favorable Debt-to-Revenue ratio of 0.25 further solidifies its financial health.
Profitability Rank Breakdown
The Profitability Rank reflects Snap-on Inc's impressive standing among its peers in generating profit. The company's Operating Margin has increased over the past five years, indicating improved efficiency and profitability. The Piotroski F-Score confirms Snap-on Inc's solid financial situation, and its strong Predictability Rank of 5 stars out of five underscores its consistent operational performance.
Growth Rank Breakdown
Ranked highly in Growth, Snap-on Inc demonstrates a strong commitment to expanding its business. The company's 3-Year Revenue Growth Rate of 9.6% outperforms better than 57.41% of companies in the Industrial Products industry. Moreover, Snap-on Inc has seen a robust increase in its EBITDA over the past few years, highlighting its continued capability to drive growth.
Next Steps
Considering Snap-on Inc's financial strength, profitability, and growth metrics, the GF Score highlights the firm's unparalleled position for potential outperformance. Investors seeking to capitalize on such robust financial health and promising growth trajectory may find Snap-on Inc an attractive option. As the company continues to navigate the dynamic market landscape, its strong fundamentals may pave the way for sustained success.
GuruFocus Premium members can find more companies with strong GF Scores using the following screener link: GF Score Screen
This article, generated by GuruFocus, is designed to provide general insights and is not tailored financial advice. Our commentary is rooted in historical data and analyst projections, utilizing an impartial methodology, and is not intended to serve as specific investment guidance. It does not formulate a recommendation to purchase or divest any stock and does not consider individual investment objectives or financial circumstances. Our objective is to deliver long-term, fundamental data-driven analysis. Be aware that our analysis might not incorporate the most recent, price-sensitive company announcements or qualitative information. GuruFocus holds no position in the stocks mentioned herein.
