Mohawk Industries Inc

MHK

Carpets & Rugs

Mkt Cap

$7.367B

PE

-17.76

Debt

$2.626B

Cash

$658.5M

EV

$9.334B

FCF

$684.4M

Market Cap

$7.367B

P/E Ratio

-17.76

Debt

$2.626B

Cash

$658.5M

EV

$9.334B

FCF

$684.4M

Charts data: {"Earnings":[{"time":"2014-12-30","value":531965000},{"time":"2015-12-30","value":615108000},{"time":"2016-12-30","value":930239000},{"time":"2017-12-30","value":971592000},{"time":"2018-12-30","value":857812000},{"time":"2019-12-30","value":744211000},{"time":"2020-12-30","value":515595000},{"time":"2021-12-30","value":1033159000},{"time":"2022-12-30","value":25247000},{"time":"2023-12-30","value":-439516000}],"Sales":[{"time":"2014-12-30","value":-116348000},{"time":"2015-12-30","value":8071563000},{"time":"2016-12-30","value":8959087000},{"time":"2017-12-30","value":9491290000},{"time":"2018-12-30","value":9983634000},{"time":"2019-12-30","value":9970672000},{"time":"2020-12-30","value":9552197000},{"time":"2021-12-30","value":11200613000},{"time":"2022-12-30","value":11737065000},{"time":"2023-12-30","value":11135115000}],"Net Margins":[{"time":"2014-12-30","value":-4.572188606594011},{"time":"2015-12-30","value":0.07620680158229577},{"time":"2016-12-30","value":0.1038318971564848},{"time":"2017-12-30","value":0.10236669620251831},{"time":"2018-12-30","value":0.08592181965003926},{"time":"2019-12-30","value":0.07464000420433047},{"time":"2020-12-30","value":0.053976587794410016},{"time":"2021-12-30","value":0.09224129072221315},{"time":"2022-12-30","value":0.0021510488354626986},{"time":"2023-12-30","value":-0.03947116846121482}],"Assets":[{"time":"2014-12-30","value":8285544000},{"time":"2015-12-30","value":9942364000},{"time":"2016-12-30","value":10230596000},{"time":"2017-12-30","value":12094853000},{"time":"2018-12-30","value":13099123000},{"time":"2019-12-30","value":13386680000},{"time":"2020-12-30","value":14327751000},{"time":"2021-12-30","value":14224517000},{"time":"2022-12-30","value":14120432000},{"time":"2023-12-30","value":13559869000}],"Stockholders Equity":[{"time":"2014-12-30","value":4422813000},{"time":"2015-12-30","value":4860863000},{"time":"2016-12-30","value":5783487000},{"time":"2017-12-30","value":7067009000},{"time":"2018-12-30","value":7440059000},{"time":"2019-12-30","value":8126448000},{"time":"2020-12-30","value":8541158000},{"time":"2021-12-30","value":8428216000},{"time":"2022-12-30","value":8017914000},{"time":"2023-12-30","value":7629136000}],"ROE":[{"time":"2014-12-30","value":0.12027752473369324},{"time":"2015-12-30","value":0.12654296160990341},{"time":"2016-12-30","value":0.16084396835334808},{"time":"2017-12-30","value":0.13748277382977722},{"time":"2018-12-30","value":0.11529639751512723},{"time":"2019-12-30","value":0.09157887923481452},{"time":"2020-12-30","value":0.060365936328539996},{"time":"2021-12-30","value":0.12258335571845809},{"time":"2022-12-30","value":0.0031488239958672544},{"time":"2023-12-30","value":-0.05761019334299454}],"ROA":[{"time":"2014-12-30","value":0.09327039962614404},{"time":"2015-12-30","value":0.08424213798649899},{"time":"2016-12-30","value":0.1251093289188626},{"time":"2017-12-30","value":0.11196274977463554},{"time":"2018-12-30","value":0.08361826971164406},{"time":"2019-12-30","value":0.06179455996557772},{"time":"2020-12-30","value":0.04438952072799143},{"time":"2021-12-30","value":0.09385281763872896},{"time":"2022-12-30","value":0.017295292381989447},{"time":"2023-12-30","value":-0.021224983810684307}]}

Mohawk Industries, Inc. designs, manufactures, sources, distributes, and markets flooring products for residential and commercial remodeling, and new construction channels in the United States, Europe, Russia, and internationally. It operates through three segments: Global Ceramic, Flooring North America (Flooring NA), and Flooring Rest of the World (Flooring ROW). The Global Ceramic segment provides a range of ceramic tile, porcelain tile, natural stone, porcelain slab, quartz countertop, and other products, as well as installation materials under the American Olean, Daltile, Eliane, EmilGroup, KAI, Kerama Marazzi, Marazzi, and Ragno brands. The Flooring NA segment offers floor covering products in various colors, textures, and patterns, including broadloom carpets, carpet tiles, rugs and mats, carpet pads, laminate, medium-density fiberboards, wood flooring, luxury vinyl tiles (LVT), and sheet vinyl products through floor covering retailers, distributors, home centers, mass merchants, department stores, e-commerce retailers, shop at home, buying groups, builders, commercial contractors, and commercial end users. This segment markets and distributes its flooring products under the Aladdin Commercial, Durkan, IVC, Karastan, Mohawk, Mohawk Group, Mohawk Home, Pergo, Portico, and Quick-Step brands. The Flooring ROW segment provides laminate, LVT and sheet vinyl, wood flooring, broadloom carpet, and carpet tile collections; and roofing panels, insulation boards, mezzanine flooring products, and chipboards under the Feltex, GH Commercial, Godfrey Hirst, Hycraft, IVC Commercial, IVC Home, Leoline, Moduleo, Pergo, Quick-Step, and Unilin brands. This segment also licenses its intellectual property to flooring manufacturers. The company was incorporated in 1988 and is headquartered in Calhoun, Georgia.

Sector

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3/31/18
10-K
12/31/17

DCF

Discounted Cash Flow Valuation of Mohawk Industries Inc

Calculate

Growth Years

Growth

Start

End

Discount

Start

End

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	$684.4M	$701.5M	$718.9M	$736.8M	$755.2M	$774M	$793.3M	$813M	$833.3M	$854M	$875.3M	$8.753B
DCF		$610M	$543.6M	$484.5M	$431.8M	$384.8M	$343M	$305.7M	$272.4M	$242.8M	$216.4M	$2.164B
Value	$5.998B

Chart P/E ratio

In the chart Earnings are multiplied by this value.

Earnings Growth -9.6%

Earnings Stability -1.4%

Competitiveness and MOAT

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.

The Net Margin is too low to guarantee profitability in case of higher costs or higher interest rates. Furthermore lower margins cause higher earnings’ volatility.

Over time the ROA has been decreasing indicating a lower marginal ROA with respect to the calculated one, this could impede growth.

Years	12-2015	12-2016	12-2017	12-2018	12-2019	12-2020	12-2021	12-2022	12-2023	TTM
Net Margin	7.6%	10%	10%	8.6%	7.5%	5.4%	9.2%	0.22%	-3.9%	-3.8%
ROA	8.4%	13%	11%	8.4%	6.2%	4.4%	9.4%	1.7%	-2.1%	-2%
ROE	13%	16%	14%	12%	9.2%	6%	12%	0.31%	-5.8%	-5.4%

What is the average Net Margin?

The average Net Margin over the past 5 years is +4.49%.

What is the trend of Net Margin?

The trend of Net Margin over the past 5 years is -2.3%.

What is the average Return on Assets (ROA)?

The average ROA over the past 5 years is +4.66%.

What is the trend of Return on Assets (ROA)?

The trend of ROA over the past 5 years is -1.74%.

What is the average Return on Equity (ROE)?

The average ROE over the past 5 years is +5.59%.

What is the trend of Return on Equity (ROE)?

The trend of ROE over the past 5 years is -3.05%.

Safety & Stabiliy

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.

Under the assumption that FCF does not diminish and debt does not increase, the current years to repay the debt are acceptable.

The Graham’s stability indicate a relevant drawdown, consider checking when it has occured and why.

Years	12-2015	12-2016	12-2017	12-2018	12-2019	12-2020	12-2021	12-2022	12-2023	TTM
Debt FCF	12.75	5.94	13.79	12.93	4.15	2.32	4.67	41.48	5.19	3.84
Debt Equity	1.07	0.67	0.56	0.67	0.45	0.37	0.35	0.46	0.49	0.34
MIN
Graham Stability	-	-	100%	100%	81%	60%	100%	3.3%	-84%	-84%

What is the Debt/FCF?

The Debt/FCF trailing twelve month is 3.84.

What is the trend of Debt/FCF?

The trend of Debt/FCF over the past 5 years is 2.16.

What is the Graham’s Stability?

Graham’s Stability measure stands at -0.84.

Growth

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.

Earnings growth has not been increasing in the past years.

Years	12-2016	12-2018	12-2020	12-2022	Trend
Revenue	3.2%	2.2%	5.2%	-5.1%	-1%
Net Income	-	-	-	-	-7.8%
Stockholders Equity	4%	0.5%	-3.7%	-4.8%	-3%
FCF	1.3%	13%	-19%	710%	20%

What is the 5 year Revenue CAGR?

The Revenue CAGR over the past 5 years is +2.21%.

What is the trend of Revenue growth?

The trend of Revenue growth rate over the past 5 years is -1.03%.

What is the 5 year Earnings CAGR?

The Earnings CAGR over the past 5 years is -.

What is the trend of Earnings growth?

The trend of Earnings growth rate over the past 5 years is -7.78%.

What is the 5 year Equity CAGR?

The Equity CAGR over the past 5 years is +0.5%.

What is the trend of Equity growth?

The trend of Equity growth rate over the past 5 years is -2.96%.

What is the 5 year FCF CAGR?

The FCF CAGR over the past 5 years is +13.09%.

What is the trend of FCF growth?

The trend of FCF growth rate over the past 5 years is +20%.