Preformed Line Products Co (PLPC) stock analysis

P/E above its 5-year median

Preformed Line Products's P/E of 25.3 is above its own 5-year median of 12.7.

P/E below the industry

Preformed Line Products's P/E of 25.3 is below the Heavy Construction Other Than Building Construction Contractors median of 28.1.

EV/EBITDA above its 5-year median

Preformed Line Products's EV/EBITDA of 13.8 is above its 5-year median of 7.8.

P/B below the industry

Preformed Line Products's price-to-book of 2.87 is below the Heavy Construction Other Than Building Construction Contractors median of 3.33.

Trading above fair value

The share price of $301.00 is above our fair value estimate of $227.89.

Margin of safety under 20%

The price is 32.1% above fair value, so there is no margin of safety.

Revenue growing under 10% a year

Revenue grew 1.7% a year over the last three fiscal years, short of the 10% we look for.

EPS growing under 10% a year

Diluted EPS grew -13.1% a year over the last three fiscal years.

Earnings growth accelerating

Net income grew 56.8% over the last twelve months, against a 5-year average of 3.4% a year.

Growing slower than the industry

Revenue grew 16.3% over the last twelve months; the Heavy Construction Other Than Building Construction Contractors median is 16.4%.

Company guidance

No outlook found in earnings releases from the last twelve months.

Gross margin improving

Gross margin was 32.4% over the last twelve months, against 32.0% a year earlier.

Return on equity under 15%

Return on equity was 12.0% over the last twelve months and averaged 12.2% over five years; we look for 15% on both.

Return on capital over 10%

Return on invested capital was 12.7%, above the 10% that usually covers the cost of capital.

Return on equity below the industry

Preformed Line Products's return on equity of 12.0% is below the Heavy Construction Other Than Building Construction Contractors median of 12.7%.

Earnings grew over 5 years

Net income grew 3.4% a year on average over the last five fiscal years.

Net margin above its 5-year average

Net margin was 7.6% over the last twelve months, against a 5-year average of 7.3%.

Net margin above the industry

Preformed Line Products's net margin of 7.6% is above the Heavy Construction Other Than Building Construction Contractors median of 2.6%.

Low debt

Debt is 10.4% of shareholders' equity, under the 40% we consider low.

Debt falling against equity

Debt to equity fell from 21.0% five years ago to 10.4%.

Debt covered by cash flow

Operating cash flow over the last twelve months equals 168% of total debt.

Interest well covered

Operating income covers interest expense 52.3 times.

Short-term assets cover short-term debts

Current assets are 2.85 times current liabilities.

Low bankruptcy risk

The Altman Z-score is 6.86; above 3 is the safe zone and below 1.8 the distress zone.

Pays a dividend

Preformed Line Products paid dividends worth 0.3% of the share price over the last twelve months.

Yield below Treasuries

The 0.3% yield is below the 4.4% on a 1-year Treasury.

Yield below the top quarter

The top quarter of US dividend payers yield 3.8% or more; Preformed Line Products yields 0.3%.

Dividend not cut

The dividend per share has not fallen by more than 10% in any of the last 7 fiscal years.

Covered by earnings

Dividends take 7.1% of net income.

Covered by free cash flow

Dividends take 11.4% of free cash flow.