Steel Works, Blast Furnaces & Rolling & Finishing Mills
Insteel Industries, Inc., together with its subsidiaries, manufactures and markets steel wire reinforcing products for concrete construction applications. The company offers prestressed concrete strand (PC strand) and welded wire reinforcement (WWR) products. Its PC strand is a seven-wire strand that is used to impart compression forces into precast concrete elements and structures providing reinforcement for bridges, parking decks, buildings, and other concrete structures. The company's WWR engineered reinforcing product is used in nonresidential and residential construction. It produces a range of WWR products, such as engineered structural mesh, an engineered made-to-order product that is used as the primary reinforcement for concrete elements or structures serving as a reinforcing solution for hot-rolled rebar; concrete pipe reinforcement, an engineered made-to-order product, which is used as the primary reinforcement in concrete pipe, box culverts, and precast manholes for drainage and sewage systems, water treatment facilities, and other related applications; and standard welded wire reinforcement, a secondary reinforcing product for crack control applications in residential and light nonresidential construction, including driveways, sidewalks, and various slab-on-grade applications. The company sells its products through sales representatives to the manufacturers of concrete products, rebar fabricators, distributors, and contractors primarily in the United States, Canada, Mexico, and Central and South America. Insteel Industries, Inc. was founded in 1953 and is headquartered in Mount Airy, North Carolina.
Sector
Discounted Cash Flow Valuation of Insteel Industries Inc
Growth
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%
Discount
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%
Multiple
g\r | +10% | +11% | +12% | +13% | +14% |
---|---|---|---|---|---|
0% | 10 | 9 | 8 | 8 | 7 |
+1% | 11 | 10 | 9 | 8 | 8 |
+2% | 13 | 11 | 10 | 9 | 8 |
+3% | 14 | 13 | 11 | 10 | 9 |
+4% | 17 | 14 | 12 | 11 | 10 |
Years | 0 | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 | TV |
---|---|---|---|---|---|---|---|---|---|---|---|---|
FCF | $56.31M | $59.14M | $62.11M | $65.23M | $68.5M | $71.94M | $75.54M | $79.32M | $83.29M | $87.46M | $91.83M | $918.3M |
DCF | $51.43M | $46.97M | $42.89M | $39.17M | $35.76M | $32.66M | $29.82M | $27.23M | $24.86M | $22.7M | $227M | |
Value | $580.5M |
In the chart Earnings are multiplied by this value.
High margins render the company resilient under dire circumstances, hence able to drive competitors out or acquire them. ROE and ROA measure the average flow generated by each invested dollar. Their marginal value is a forecast of future growth, and it is considered by Buffett and Munger the most important single indicator.
Years | 10-2015 | 09-2016 | 09-2017 | 09-2018 | 09-2019 | 10-2020 | 10-2021 | 09-2022 | 09-2023 | TTM |
---|---|---|---|---|---|---|---|---|---|---|
Net Margin | 4.9% | 8.9% | 5.8% | 8% | 1.2% | 4% | 11% | 15% | 5% | 4.2% |
ROA | 13% | 19% | 12% | 13% | 2.5% | 7.2% | 22% | 34% | 9.3% | 7.9% |
ROE | 11% | 17% | 10% | 15% | 2.3% | 7.2% | 22% | 32% | 8.5% | 7.1% |
The average Net Margin over the past 5 years is +7.44%.
The trend of Net Margin over the past 5 years is +0.97%.
The average ROA over the past 5 years is +14.71%.
The trend of ROA over the past 5 years is +2.63%.
The average ROE over the past 5 years is +14.51%.
The trend of ROE over the past 5 years is +2.05%.
Being debt the number one cause of investment losses and company death, the ratio Debt/FCF is of utmost importance to guarantee safety. On the other hand the Graham’s stability measures the drawdown of earnings, hence indicating the reliability of the flow generated by the company.
Years | 10-2015 | 09-2016 | 09-2017 | 09-2018 | 09-2019 | 10-2020 | 10-2021 | 09-2022 | 09-2023 | TTM |
---|---|---|---|---|---|---|---|---|---|---|
Debt FCF | - | - | - | - | - | - | - | - | - | - |
Debt Equity | - | - | - | - | - | - | - | - | - | - |
MIN | ||||||||||
Graham Stability | - | - | 89% | 100% | 17% | 89% | 100% | 100% | 46% | 17% |
The Debt/FCF trailing twelve month is -.
The trend of Debt/FCF over the past 5 years is -.
Graham’s Stability measure stands at 0.17.
Growth can be dangerous when forecasting, simply projecting the current growth is in general wrong. A company passes through multiple phases, from being young and unprofitable, to the first periods of profitability and high growth, until it arrives at a period of regime with limited growth. Identifying in which phase the company is in may help forecasting.
Years | 09-2016 | 09-2018 | 10-2020 | 09-2022 | Trend |
---|---|---|---|---|---|
Revenue | 6.5% | 7.5% | 11% | -21% | 1.1% |
Net Income | -2% | -2.2% | 19% | -74% | 6.5% |
Stockholders Equity | 7.9% | 9.6% | 13% | -2.1% | 0.39% |
FCF | 15% | 26% | 31% | - | -6.4% |
The Revenue CAGR over the past 5 years is +7.45%.
The trend of Revenue growth rate over the past 5 years is +1.12%.
The Earnings CAGR over the past 5 years is -2.22%.
The trend of Earnings growth rate over the past 5 years is +6.48%.
The Equity CAGR over the past 5 years is +9.56%.
The trend of Equity growth rate over the past 5 years is +0.39%.
The FCF CAGR over the past 5 years is +25.71%.
The trend of FCF growth rate over the past 5 years is -6.38%.