Valuation
Value $63 Price $53. Underpriced by 17%.
현재 시장기대치와 스토리
현재 가격에 반영된 가정
매출성장 향후 5년간 연 3% , 타깃 영업이익률 12%(Converge 5년) .
스토리
성장 5%, 이익률13%. 옛날에 한 번 꺾였다 다시 성장중. 성장하며 수익성은 2010년 이전 3~5%에서 12%~15%로 좋아짐. 외형은 쪼그라들었지만 시장에서 자리잡은듯.
시뮬레이션
추후 해볼 것.
Pricing
- PE: 11.3
- PB: 2.3
- P/TangB: 45.3
- PS: 1
- P/CF: 8.1
- P/FCF: 11.2
- EV/Sales: 1.5
- EV/EBITDA: 7.7
- EV/EBIT: 10.5
- EV: 5.6B
기타
소스
Value Screen Feb2020
자료(시트)
Description
Company Description
The Timken Company manufactures and distributes tapered roller bearings, as well as cylindrical, spherical, and precision ball bearings. The Company also produces power transmission components and assemblies, as well as systems such as helicopter transmissions.
Extended Company Description (Source: Hoover’s Inc., a Dun & Bradstreet Company)
OVERVIEW
The Timken Company keeps its bearings straight. The company makes bearings that find their way into products from consumer appliances to railroad cars. Timken also makes helicopter transmission systems, rotor-head assemblies, turbine engine components, gears, and housings for civil and military aircraft. Its customers include manufacturers of cars, light and heavy-duty trucks, railcars and locomotives, and heavy-duty industrial vehicles. Process industry customers include metals, oil and gas, pulp and paper, and food and beverage. Timken traces its roots to its founding by carriage maker Henry Timken in 1899. The US accounts for about half of sales.
Operations
Timken is divided into two market-based divisions. Mobile Industries (about 55% of net sales) targets manufacturers of cars, light and heavy-duty trucks, rail cars and locomotives, as well as construction, agricultural, and mining vehicles. Process Industries (45% of revenue) serves the energy, pulp and paper, and automation and robotics industries, among others.
Geographic Reach
Timken serves 35 countries through nearly 120 manufacturing facilities, about 20 technology and engineering centers, and more than 50 distribution centers and warehouses worldwide. About 50% of its net sales come from the US.
Sales and Marketing
Timken’s products are sold primarily through its internal sales force and through authorized distributors. The company’s sales strategy involves close collaboration with customers. Sales teams assist customers throughout product/process development and implementation.
Financial Performance
Timken’s sales have been choppy the last five years but have been on the upswing since 2016. Between 2014 and 2018, the company’s revenue has grown 16%, mostly driven by higher organic growth and the benefit of acquisitions.
Sales in 2018 increased 19% to $3.6 billion compared to $3.0 billion in 2017. Growth in 2018 was led by Timken’s Process Industries unit, which saw revenue increase 23% on improved demand from all customer groups and higher pricing. Similar factors drove 16% revenue growth for the Mobile Industries segment.
Net income increased 49% to $302.8 million in 2018 compared to 2017, primarily due to higher sales volumes, favorable product mix, higher pricing, acquisitions, and manufacturing efficiency improvements.
Cash at the end of 2018 was $133.1 million, an increase of $7.7 million from the prior year. Cash from operations contributed $332.5 million to the coffers, while investing activities used $865.2 million, mainly for acquisitions and capital expenditures. Financing activities brought in $553.1 million, primarily from long-term borrowing.
Strategy
Timken has restructured over the years to focus on its Process Industries and Mobile Industries business segments. The company invests in organic innovation while making acquisitions that complement or extend existing product lines. This approach has helped Timken enter new markets, sales channels, and geographies, which may better insulate it from cyclical downturns in specific customer industries.
In 2018 the company spent more than $830 million to acquire three companies ? ABC Bearings, Cone Drive, and Rollon Group. The deals expanded Timken’s capabilities to serve growth markets including solar energy, logistics and packaging, and industrial automation, while growing its geographic footprint in Asia and Europe.
Mergers and Acquisitions
Timken often uses acquisitions to fortify its core offerings and introduce new products to the marketplace. In 2019, the company acquired Indiana-based The Diamond Chain Company, a maker of high-performance industrial roller chains for markets including material handling, food and beverage, and agriculture. The deal enhanced Timken’s drive chains business and grew its manufacturing base in the US and China. The same year, it completed the $165 million acquisition of BEKA Lubrication, a global supplier of automatic lubrication systems, serving a range if industries including wind, food and beverage, transportation, and industrial process industries.
In 2018, the company completed the acquisition of Rollon Group, a maker of engineered linear motion products. Rollon’s products are used in a wide range of industries such as passenger rail, aerospace, packaging and logistics, medical, and automation.
Earlier in 2018, Timken acquired ABC Bearings, a manufacturer of roller bearings and slewing rings based in India. The deal will enhance Timken’s position within the growing Indian bearing market and bolster its expertise in tapered bearings. Another 2018 purchase included Apiary Investment Holdings (dba Cone Drive), a Michigan-based maker of precision drives used in diverse markets including solar, automation, and food and beverage.
HISTORY
Veteran St. Louis carriage maker Henry Timken patented a design in 1898 for tapered roller bearings (enclosed bearings between a pair of concentric rings). The following year Timken and his sons, William and Henry (H. H.) Timken, founded the Timken Roller Bearing Axle Company to make bearings for carriage axles.
In 1902 the company moved to Canton, Ohio, to be near the growing steelworks of Pittsburgh and the new auto industries of Buffalo, New York; Cleveland; and Detroit. With the debut of the Ford Motor Model T in 1908, the Timkens’ business soared. In 1909 Henry Timken died. That year a separate company, the Timken-Detroit Axle Company, was formed in Michigan to serve the auto industry. The original company changed its name to the Timken Roller Bearing Company and continued to produce bearings. Also in 1909 Vickers began making bearings and axles under license from Timken (Timken acquired that operation in 1959).
Suffering steel shortages during WWI, the company began making its own steel in 1916. By the 1920s the rail industry had adopted Timken bearings to increase the speed of trains. Timken stock was sold to the public for the first time in 1922.
