Timken Company engineers, manufactures and markets bearings, transmissions, gearboxes, chain and related products, and offers a spectrum of powertrain rebuild and repair services. The company was founded in 1899 and is based in North Canton, Ohio.
TKR Price Forecast Based on DCF Valuation
DCF Fair Value Target:
The table below illustrates the output of a discounted cash flow forecast using a variety of scenarios for Timken Co. To summarize, we found that Timken Co ranked in the 67th percentile in terms of potential gain offered. Specifically, our DCF analysis implies the stock is trading below its fair value by an estimated 182%. The most interesting components of our discounted cash flow analysis for Timken Co ended up being:
Interest coverage, a measure of earnings relative to interest payments, is 6.66; that's higher than 64.26% of US stocks in the Industrials sector that have positive free cash flow.
Timken Co's weighted average cost of capital (WACC) is 7%; for context, that number is higher than just 10.69% of tickers in our DCF set.
Terminal Growth Rate in Free Cash Flow
Return Relative to Current Share Price
WWD, HUBG, KFY, STN, and UPWK can be thought of as valuation peers to TKR, in the sense that they are in the Industrials sector and have a similar price forecast based on DCF valuation.
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Moody's Investors Service ("Moody's") has completed a periodic review of the ratings of Timken Company (The) and other ratings that are associated with the same analytical unit. The review was conducted through a portfolio review in which Moody's reassessed the appropriateness of the ratings in the context of the relevant principal methodology(ies), recent developments, and a comparison of the financial and operating profile to similarly rated peers.