Is Weakness In ITT Inc. (NYSE:ITT) Stock A Sign That The Market Could Be Wrong Given Its Strong Financial Prospects?
Is Weakness In ITT Inc. (NYSE:ITT) Stock A Sign That The Market Could Be Wrong Given Its Strong Financial Prospects?
ITT (NYSE:ITT) has had a rough week with its share price down 4.6%. But if you pay close attention, you might gather that its strong financials could mean that the stock could potentially see an increase in value in the long-term, given how markets usually reward companies with good financial health. In this article, we decided to focus on ITT's ROE.
ITT(纽约证券交易所代码：ITT)经历了艰难的一周，其股价下跌了4.6%。但如果你仔细观察，你可能会猜到，它强劲的财务状况可能意味着，考虑到市场通常会奖励财务状况良好的公司，该股可能会在长期内增值。在本文中，我们决定关注ITT的净资产收益率。
Return on Equity or ROE is a test of how effectively a company is growing its value and managing investors' money. In short, ROE shows the profit each dollar generates with respect to its shareholder investments.
股本回报率(ROE)是对一家公司增值和管理投资者资金的效率的测试。简而言之，净资产收益率显示了每一美元相对于其股东投资产生的利润。
View our latest analysis for ITT
查看我们对ITT的最新分析
How Is ROE Calculated?
净资产收益率是如何计算的？
The formula for ROE is:
这个净资产收益率公式是：
Return on Equity = Net Profit (from continuing operations) ÷ Shareholders' Equity
股本回报率=(持续经营的)净利润？股东权益
So, based on the above formula, the ROE for ITT is:
因此，根据上述公式，ITT的净资产收益率为：
18% = US$429m ÷ US$2.4b (Based on the trailing twelve months to July 2023).
18%=4.29亿美元×24亿美元(基于截至2023年7月的12个月)。
The 'return' is the yearly profit. So, this means that for every $1 of its shareholder's investments, the company generates a profit of $0.18.
“回报”就是年度利润。因此，这意味着股东每投资1美元，公司就会产生0.18美元的利润。
What Has ROE Got To Do With Earnings Growth?
净资产收益率与盈利增长有什么关系？
Thus far, we have learned that ROE measures how efficiently a company is generating its profits. Based on how much of its profits the company chooses to reinvest or "retain", we are then able to evaluate a company's future ability to generate profits. Assuming all else is equal, companies that have both a higher return on equity and higher profit retention are usually the ones that have a higher growth rate when compared to companies that don't have the same features.
到目前为止，我们已经了解到净资产收益率衡量的是一家公司创造利润的效率。根据公司选择再投资或“保留”多少利润，我们就能够评估一家公司未来产生利润的能力。假设其他条件相同，与没有相同特征的公司相比，拥有更高股本回报率和更高利润保留率的公司通常会有更高的增长率。
A Side By Side comparison of ITT's Earnings Growth And 18% ROE
ITT盈利增长与18%净资产收益率的并列比较
At first glance, ITT seems to have a decent ROE. Especially when compared to the industry average of 14% the company's ROE looks pretty impressive. This probably laid the ground for ITT's moderate 7.3% net income growth seen over the past five years.
乍一看，ITT似乎有不错的净资产收益率。特别是与14%的行业平均水平相比，该公司的净资产收益率看起来相当令人印象深刻。这可能为ITT过去五年7.3%的净利润温和增长奠定了基础。
As a next step, we compared ITT's net income growth with the industry and found that the company has a similar growth figure when compared with the industry average growth rate of 8.2% in the same period.
作为下一步，我们将ITT的净收入增长与行业进行了比较，发现该公司的增长数字与同期8.2%的行业平均增长率相似。
Earnings growth is a huge factor in stock valuation. It's important for an investor to know whether the market has priced in the company's expected earnings growth (or decline). By doing so, they will have an idea if the stock is headed into clear blue waters or if swampy waters await. Has the market priced in the future outlook for ITT? You can find out in our latest intrinsic value infographic research report.
盈利增长是股票估值的一个重要因素。对于投资者来说，重要的是知道市场是否已经消化了公司预期的收益增长(或下降)。通过这样做，他们将知道股票是将进入清澈的蓝色水域，还是等待沼泽水域。市场反映出ITT的未来前景了吗？你可以在我们最新的内在价值信息图研究报告中找到答案。
Is ITT Using Its Retained Earnings Effectively?
ITT是否有效地利用了其留存收益？
With a three-year median payout ratio of 25% (implying that the company retains 75% of its profits), it seems that ITT is reinvesting efficiently in a way that it sees respectable amount growth in its earnings and pays a dividend that's well covered.
ITT的三年中值派息率为25%(这意味着该公司保留了75%的利润)，看起来它正在以一种高效的方式进行再投资，它看到了可观的收益增长，并支付了丰厚的股息。
Besides, ITT has been paying dividends for at least ten years or more. This shows that the company is committed to sharing profits with its shareholders. Existing analyst estimates suggest that the company's future payout ratio is expected to drop to 20% over the next three years. However, the company's ROE is not expected to change by much despite the lower expected payout ratio.
此外，ITT的红利至少已经有十年甚至更长的时间了。这表明该公司致力于与股东分享利润。分析师现有的预估显示，该公司未来三年的派息率预计将降至20%。然而，尽管预期派息率较低，该公司的净资产收益率预计不会有太大变化。
Conclusion
结论
Overall, we are quite pleased with ITT's performance. In particular, it's great to see that the company is investing heavily into its business and along with a high rate of return, that has resulted in a sizeable growth in its earnings. On studying current analyst estimates, we found that analysts expect the company to continue its recent growth streak. To know more about the company's future earnings growth forecasts take a look at this free report on analyst forecasts for the company to find out more.
总体而言，我们对ITT的表现相当满意。特别是，很高兴看到该公司在业务上投入了大量资金，并获得了高回报率，这导致了其收益的可观增长。在研究了分析师目前的预测后，我们发现，分析师预计该公司将继续最近的增长势头。要了解更多有关该公司未来收益增长预测的信息，请查看以下内容免费报告分析师对该公司的预测，以了解更多信息。
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本文由Simply Wall St.撰写，具有概括性。我们仅使用不偏不倚的方法提供基于历史数据和分析师预测的评论，我们的文章并不打算作为财务建议。它不构成买卖任何股票的建议，也没有考虑你的目标或你的财务状况。我们的目标是为您带来由基本面数据驱动的长期重点分析。请注意，我们的分析可能不会将最新的对价格敏感的公司公告或定性材料考虑在内。Simply Wall St.对上述任何一只股票都没有持仓。