Fact based stock research
Travis Perkins (LSE:TPK)

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For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".

Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".

Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.

Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.

(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).

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Travis Perkins stock research in summary

travisperkinsplc.co.uk

ANALYSIS: With an Obermatt Combined Rank of 16 (worse than 84% compared with investment alternatives), Travis Perkins (Trading & Distribution, United Kingdom) shares have lower financial characteristics compared with similar stocks. Shares of Travis Perkins are low in value (priced high) with a consolidated Value Rank of 45 (worse than 55% of alternatives), show below-average growth (Growth Rank of 24), and are riskily financed (Safety Rank of 43), which means above-average debt burdens. ...read more

RECOMMENDATION: A Combined Rank of 16, is a sell recommendation based on Travis Perkins's financial characteristics. As the company Travis Perkins's key financial metrics all exhibit below-average performance, such as low value (Obermatt Value Rank of 45), low growth (Obermatt Growth Rank of 24), and risky financing practices (Obermatt Safety Rank of 43), it is a somewhat questionable stock investment, where the risk of paying too much for the shares is significant, unless the company has an exceptionally bright future. Such poor financial performance sometimes indicates that the company's business is all concentrated in some distant future. This is sometimes the case for high-tech or biotechnology companies. If they own properties that only provide cash flows in the future, the stock may look excessively expensive and risky today. In such cases, the Obermatt Method has limited value as it is based on facts we can observe today. If the facts are all in the future, stock investing becomes guesswork, and this should only be a driver in a limited number of investments that should only amount to a small fraction of a safe portfolio. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more

Latest Obermatt Ranks


360° View^new
Sentiment Rank^new
Value Rank	45
Growth Rank	24
Safety Rank	43
Combined Rank	16

Country	United Kingdom
Industry	Trading & Distribution
Index	FTSE All Shares, FTSE 250, FTSE 350, Timber Industry
Size class	X-Large

14-Nov-2024. Stock data may be delayed. Log in or sign up to get the most recent research.

Further information

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Review the performance ranks of the individual metrics that form each investment strategy.

Research History: Travis Perkins

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	39	61	60	45
GROWTH
GROWTH	89	57	35	24
SAFETY
SAFETY	82	24	52	43
SENTIMENT
SENTIMENT	n/a	81	12	^new
360° VIEW
360° VIEW	n/a	62	20	^new

Most recent update of the stock research: 14-Nov-2024. Financial reporting date used for calculating ranks: 30-Jun-2024. Stock research history is based on the Obermatt Method. The higher the rank, the better Travis Perkins is in the corresponding investment strategy.
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Combined financial peformance in Detail

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	39	61	60	45
GROWTH
GROWTH	89	57	35	24
SAFETY
SAFETY	82	24	52	43
COMBINED
COMBINED	67	37	43	16

Last update of combined financial performance: 14-Nov-2024. Stock analysis on combined financial performance: The higher the rank of Travis Perkins the better the performance.

Value Metrics in Detail

ANALYSIS: With an Obermatt Value Rank of 45 (worse than 55% compared with alternatives), Travis Perkins shares are more expensive than the average comparable stock. The Value Rank is based on consolidating four value indicators, where half the indicators are below and half above average for Travis Perkins. Price-to-Sales (P/S) is 72, which means that the stock price compared with what market professionals expect for future sales is lower than for 72% of comparable companies, indicating a good value concerning Travis Perkins's revenue size. The same is valid for the Price-to-Book Capital ratio (also referred to as market-to-book ratio), which is more favorable than for 77% of alternatives (23% of peers have a higher ratio). But expected dividend yields with a Dividend Yield rank of 32 are lower than average (dividends are expected to be lower than 68% of other stocks) while the Price to Profit ratio (or Price to Earnings (P/E) ratio) is higher than average with a Price-to-Profit Rank of 28, making the stock more expensive compared with the company's expected profit levels. ...read more

RECOMMENDATION: The overall picture with a consolidated Value Rank of 45, is a hold recommendation based on Travis Perkins's stock price compared with the company's operational size and dividend yields. Low profits and low dividends as seen here for Travis Perkins may indicate a restructuring phase. This could be transitory, making the company a good value when profits recover and dividends return to higher levels. If the stock price is compared with the size indicators for revenue and invested capital, it is on the lower side, making this stock a good value investment (apart from current profit and dividend expectations). We recommend further analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks, including the 360° View, before making an investment decision. ...read more

VALUE METRICS	2021	2022	2023	2024
PRICE VS. REVENUES (P/S)
PRICE VS. REVENUES (P/S)	54	66	71	72
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)	61	61	38	28
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)	42	72	75	77
DIVIDEND YIELD
DIVIDEND YIELD	40	60	55	32
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE	39	61	60	45

Last update of Value Rank: 14-Nov-2024. Stock analysis on value ratios: The higher the rank, the lower the value ratio of Travis Perkins; except for dividend yield where the rank is higher, the higher the yield.

Growth Metrics in Detail

ANALYSIS: With an Obermatt Growth Rank of 24 (better than 24% compared with alternatives), Travis Perkins shows one of the most restricted growth dynamics in its industry. There is little momentum in this company. The Growth Rank is based on consolidating four value indicators, with three out of four indicators below average for Travis Perkins. Only Capital Growth has a good rank of 88, which means that currently professionals expect the company to grow its invested capital more than 8% of its competitors. The other three indicators are pointing South: Sales Growth has a rank of 21 which means that currently professionals expect the company to grow less than 79% of its competitors. Profit Growth with a rank of 8 and Stock Returns with a rank of 47 are also low (below 53% of alternative investments). ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 24, is a sell recommendation for growth and momentum investors. The good news from the invested capital side is surprising. A company with disappointing revenues, profits, and disappointed shareholders typically doesn't invest above average. Overall, the growth momentum for Travis Perkins is thus negative. As it is intriguing to see that company executives are optimistic about their investment policy, it is worthwhile looking into the details of the capital investment projects. They may indicate future growth and profits and thus if accompanied by a good value, a sign of good timing to invest in the stock. While momentum is a popular investment factor, the value aspect might be the more important one, in the longer term. We recommend analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks to arrive at a 360° View of the stock purchase case, especially since the growth performance is limited here. ...read more

GROWTH METRICS	2021	2022	2023	2024
REVENUE GROWTH
REVENUE GROWTH	74	69	26	21
PROFIT GROWTH
PROFIT GROWTH	4	84	11	8
CAPITAL GROWTH
CAPITAL GROWTH	n/a	4	87	88
STOCK RETURNS
STOCK RETURNS	66	39	33	47
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH	89	57	35	24

Last update of Growth Rank: 14-Nov-2024. Stock analysis on growth metrics: The higher the rank, the higher the growth and returns of Travis Perkins.

Safety Metrics in Detail

ANALYSIS: With an Obermatt Safety Rank of 43 (better than 43% compared with alternatives), the company Travis Perkins has financing practices on the riskier side, which means that their overall debt burden is above the industry average. This doesn't mean that the business of Travis Perkins is also risky, it only means that the company is on the riskier side in respect to bankruptcy in case things turn sour, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators where two out of three are above average for Travis Perkins.Leverage is at 52, meaning the company has a below-average debt-to-equity ratio. It has less debt than 52% of its competitors.Refinancing is at a rank of 72, meaning that the portion of the debt that is about to be refinanced is below average. It has less debt in the refinancing stage than 72% of its competitors. Liquidity is at 25, meaning that the company generates less profit to service its debt than 75% of its competitors. This indicates that the company is on the riskier side regarding debt service. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 43 (worse than 57% compared with alternatives), Travis Perkins has a financing structure that is riskier than that of its competitors. Low leverage and low refinancing risk mean a safer financing situation. However, low liquidity means that current company cash flows are low in relation to the level of debt. This is a sign of caution in case it is expected for profits to remain low. Investors should compare Obermatt’s Value, Growth, and Sentiment Ranks before deciding. They may also want to investigate why cash flows are expected to be low, making debt service for Travis Perkins more challenging. ...read more

SAFETY METRICS	2021	2022	2023	2024
LEVERAGE
LEVERAGE	70	37	54	52
REFINANCING
REFINANCING	75	61	67	72
LIQUIDITY
LIQUIDITY	36	21	43	25
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY	82	24	52	43

Last update of Safety Rank: 14-Nov-2024. Stock analysis on safety metrics: The higher the rank, the lower the leverage of Travis Perkins and the more cash is available to service its debt.

Sentiment Metrics in Detail

SENTIMENT	2021	2022	2023	2024
ANALYST OPINIONS
ANALYST OPINIONS	n/a	39	11	^new
OPINIONS CHANGE
OPINIONS CHANGE	n/a	50	50	^new
PRO HOLDINGS
PRO HOLDINGS	n/a	93	41	^new
MARKET PULSE
MARKET PULSE	n/a	64	20	^new
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT	n/a	81	12	^new

Last update of Sentiment Rank: 14-Nov-2024. Stock analysis on sentiment metrics: The higher the rank, the more positive the sentiment for Travis Perkins.
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