Hello Friends! Thanks so much for stopping by. As always, remember to PLEASE do your own due diligence, that is do your own homework and investigation on all of the stocks that are discussed here and actually anywhere on the web...before taking any action. Also, consider talking to your financial advisors as stocks I discuss may not be appropriate or timely for you!
Anyhow, it is a LOUSY day in the market. Come to think of it, it has been a LOUSY month as well. Currently, as I write, the Dow is DOWN 111.85 points at 10,128.23, and the NASDAQ is down 37.21 points at 1,947.52. The skittishness over terrorism in Spain is not helping this market at all!
One stock that is bucking this trend is Toro (TTC). As I write, Toro is trading at $58.96, up $2.65 on the day or 4.71%. According to the money.cnn.com "snapshot", TTC "...principal activities are to design, develop, manufacture and sell professional turf maintenance equipment, turf and agricultural irrigation systems, landscaping equipment, and residential yard products." Around here in Wisconsin, Toro has both plants and is known for their lawnmowers and snowblowers.
On February 24, 2004, Toro reported 1st quarter 2004 results. At the same time, almost more importantly, they raised fiscal 2004 guidance. For the quarter ended January 30, 2004, Toro reported revenue of $314 million compared to $296 million the prior year. Earnings were up 33% to $.36/share compared to $.27/share the prior year.
Looking at "5-Yr Restated" financials from Morningstar.com, we can see that revenue has grown steadily from $1.1 billion in 1998 to $1.5 billion in the trailing twelve months. Earnings have been a bit erratic, increasing from $.16/share in 1998 to $1.93 in 2001, dipping to $1.37 in 2002 and back up to $3.12 in trailing twelve months.
Per Morningstar.com, the free cash flow has been solidly positive with $66 million in 2000, $35 million in 2001, $98 million in 2002, and $36 million in trailing twelve months.
Looking at assets/liabilities, we see that even though the cash level is relatively low at $15.7 million, Toro has $665.0 million in other current assets as compared to $313 million in current liabilities and only $188.9 million in long-term liabilities. There is enough in current assets and cash to easily pay off all of the liabilities.
When checking "Key Statistics" on Yahoo.com, we find that the market cap is large at $1.43 billion, the trailing p/e is nice at 18.36 (imho), and the forward p/e is even bennter at 14.38 (for fye 31-Oct-05). This results in a very nice PEG of 1.10. The price/sales is also reasonably cheap at 0.90.
There are 24.28 million shares outstanding and 23.10 million of them float. Currently there are only 394,000 shares out short (as of 2/9/04), representing 2.962 trading days or 1.71% of the float. Interestingly, the company also DOES pay a small dividend of $.24/share yielding 0.43%. The last stock split was a 2:1 split in April, 2003.
Looking at technicals, using a chart from Stockcharts.com, we see that TTC broke out of a resistance level early in January, 2001, at about $16.5/share and has powered ahead very strongly ever since then. If anything, it appears a little ahead of itself, but then again, looking at valuation, suggests that this stock may have a lot more to go on the upside.
The company is also doing what it can to support the stock price. As announced on March 12, 2004, Toro is planning to buy back 2.5 million of its shares (more than 10% of its float!), at a "Dutch auction tender" at a premium of .3% to 6.6% over Friday's closing price. This is driving the stock upwards today in the face of an overall broad-based correction in equities.
In summary, there is little that I do NOT like about this stock! I just am not currently in the market for shares, as you understand my strategy of waiting until I have a gain before buying....but the valuation is right, the company is raising estimates, the balance sheet is clean...so it looks intriguing to me! I do NOT currently own any shares or option positions on this stock!
Thanks so much for stopping by. If you have any questions, comments, or words of encouragement, please feel free to email me at firstname.lastname@example.org