Last Updated: 16 Sep 2024
Executive Summary
Snap-On Inc. (SNA) is a leading designer, manufacturer, and marketer of high-end tools and equipment for professional use in various industries. With a market capitalization of $14.77 billion, SNA has a solid financial position, supported by strong revenue, earnings, and profitability metrics. The stock is currently trading at $280.44, and analysts have a consensus target price of $282.99, indicating a potential upside.
Company Overview
Snap-On Inc. was founded in 1920 and is headquartered in Kenosha, Wisconsin. The company operates through a global network of franchisees, distributors, and company-owned stores. SNA's product portfolio includes hand tools, power tools, diagnostic equipment, and other specialized tools used in the automotive, heavy-duty equipment, marine, aviation, and railroad industries.
Fundamental Analysis
Revenue and Earnings: SNA reported revenue of $5.11 billion for the trailing twelve months (TTM), representing a slight decline of 0.4% year-over-year. Diluted EPS stood at $19.24, reflecting a growth of 3.7% over the same period.
Profitability: The company maintains a healthy gross profit margin of 47.9% and an operating margin of 28.8%. Its return on assets (ROA) and return on equity (ROE) are also strong at 11.6% and 21%, respectively.
Financial Health: SNA has a solid balance sheet with $1.47 billion in EBITDA and $100.39 in book value per share. The company also pays a quarterly dividend of $0.72 per share, resulting in a dividend yield of 0.265%.
Technical Analysis
Trend: The stock has been trading within a range between $243.16 and $294.49 over the past 52 weeks. It is currently testing resistance at the upper end of the range.
Moving Averages: The 50-day moving average ($274.68) and the 200-day moving average ($278.14) are both trending upwards, indicating a positive long-term trend.
Momentum: The relative strength index (RSI) is at 52, suggesting that the stock is neither overbought nor oversold.
Short Term Outlook
In the short term, SNA's stock may face some resistance at the $280.44 level. However, if it breaks above this resistance, it could potentially reach the analyst target price of $282.99. Key factors to watch include the company's quarterly earnings report and any macroeconomic developments that could impact demand for its products.
Long Term Outlook
The long-term outlook for SNA is positive. The company has a strong brand, a loyal customer base, and a diversified product portfolio. The increasing demand for specialized tools in various industries is expected to drive growth for SNA in the coming years.
Analyst Recommendations
Analysts have a consensus rating of "Hold" for SNA, with 7 analysts recommending a "Hold," 2 recommending a "Buy," and 1 recommending a "Strong Buy." The average target price is $282.99, implying a potential upside of 0.9% from the current price.
