Franklin Electric Company engages in the production and marketing of systems and components for the movement of water and automotive fuels. The company serves customers around the world in residential, commercial, agricultural, industrial, municipal, and fueling applications. The company was founded in 1944 and is based in Fort Wayne, Indiana.
FELE Price Forecast Based on DCF Valuation
DCF Fair Value Target:
We started the process of determining a valid price forecast for Franklin Electric Co Inc with a discounted cash flow analysis -- the results of which can be found in the table below. To summarize, we found that Franklin Electric Co Inc ranked in the 70th percentile in terms of potential gain offered. More precisely, our analysis suggests the stock is undervalued by approximately 144.33% on a DCF basis. In terms of the factors that were most noteworthy in this DCF analysis for FELE, they are:
The company's debt burden, as measured by earnings divided by interest payments, is 23.48; that's higher than 89.71% of US stocks in the Industrials sector that have positive free cash flow.
The business' balance sheet reveals debt to be 3% of the company's capital (with equity being the remaining amount). Approximately only 13.89% of US stocks with free cash flow have a lower reliance on debt in their capital structure.
FELE's estimated cost of debt, based largely on its market capitalization and its interest coverage ratio, is 3%; for context, that number is higher than 45.96% of tickers in our DCF set.
Terminal Growth Rate in Free Cash Flow
Return Relative to Current Share Price
For other companies in the Industrials that have a similar discounted cashflow valuation profile (and ensuing price forecasts) as FELE, try ACY, DAC, EME, IESC, and STN.
FORT WAYNE, Ind., Jan. 04, 2021 (GLOBE NEWSWIRE) -- Franklin Electric Co., Inc. (NASDAQ: FELE) announced today that on December 31, 2020 it acquired Gicon Pumps & Equipment Inc. of Lubbock, Texas for $27.9 million in a cash transaction. Gicon is a professional groundwater distributor operating seven locations in the state of Texas. Gicon has approximately $68 million of consolidated annual sales. DeLancey Davis, President of Headwater Companies, the wholly owned Distribution Segment of Franklin Electric, commented:“We are pleased to add Gicon to the Headwater family. The team at Gicon has served the pump industry and related water resource markets for over 40 years and has an outstanding reputation within the industry for quality service and technical depth. The acquisition of Gicon ad...
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