Industrial Inorganic Chemicals
NL Industries, Inc., through its subsidiary, CompX International Inc., operates in the component products industry in the United States and internationally. The company manufactures and sells mechanical and electronic cabinet locks and other locking mechanisms, including disc tumbler locks; pin tumbler locking mechanisms under KeSet, System 64, TuBar, and Turbine brands; and electronic locks under CompX eLock and StealthLock brands for use in various applications, such as mailboxes, ignition systems, file cabinets, desk drawers, tool storage cabinets, high security medical cabinetry, integrated inventory and access control secured narcotics boxes, electronic circuit panels, storage compartments, gas station security, vending and cash containment machines. It also offers original equipment and aftermarket stainless steel exhaust headers, exhaust pipes, mufflers, and other exhaust components; gauges, such as GPS speedometers and tachometers; mechanical and electronic controls and throttles; wake enhancement devices, trim tabs, steering wheels, and other billet aluminum accessories; dash panels, LED indicators, wire harnesses, and other accessories; and grab handles, pin cleats, and other accessories; primarily for performance and ski/wakeboard and performance boats. The company sells its component products directly to original equipment manufacturers, as well as through distributors. NL Industries, Inc. was founded in 1891 and is based in Dallas, Texas. NL Industries, Inc. is a subsidiary of Valhi, Inc.
Discounted Cash Flow Valuation of Nl 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 | $35.3M | $35.66M | $36.01M | $36.37M | $36.73M | $37.1M | $37.47M | $37.84M | $38.22M | $38.6M | $38.98M | $389.8M |
DCF | $31M | $27.23M | $23.91M | $21M | $18.44M | $16.2M | $14.23M | $12.49M | $10.97M | $9.636M | $96.36M | |
Value | $281.5M |
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 | 12-2015 | 12-2016 | 12-2017 | 12-2018 | 12-2019 | 12-2020 | 12-2021 | 12-2022 | 12-2023 | TTM |
---|---|---|---|---|---|---|---|---|---|---|
Net Margin | -22% | 14% | 100% | -35% | 21% | 13% | 36% | 20% | -1.4% | 7.1% |
ROA | 0.077% | 3.6% | 20% | -9.9% | 5.1% | 2.5% | 10% | 6.4% | 2.5% | 3.2% |
ROE | -14% | 7.9% | 33% | -14% | 7.9% | 4.4% | 13% | 8.4% | -0.59% | 2.9% |
The average Net Margin over the past 5 years is +9.03%.
The trend of Net Margin over the past 5 years is +5.38%.
The average ROA over the past 5 years is +2.79%.
The trend of ROA over the past 5 years is +2.1%.
The average ROE over the past 5 years is +3.31%.
The trend of ROE over the past 5 years is +2.14%.
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 | 12-2015 | 12-2016 | 12-2017 | 12-2018 | 12-2019 | 12-2020 | 12-2021 | 12-2022 | 12-2023 | TTM |
---|---|---|---|---|---|---|---|---|---|---|
Debt FCF | - | - | - | - | - | - | - | - | - | - |
Debt Equity | - | - | - | - | - | - | - | - | - | - |
MIN | ||||||||||
Graham Stability | - | - | 100% | -110% | 86% | 44% | - | 100% | -6.9% | -110% |
The Debt/FCF trailing twelve month is -.
The trend of Debt/FCF over the past 5 years is -.
Graham’s Stability measure stands at -1.14.
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 | 12-2016 | 12-2018 | 12-2020 | 12-2022 | Trend |
---|---|---|---|---|---|
Revenue | 5.8% | 6.4% | 12% | -3.2% | 0.82% |
Net Income | - | - | - | - | -130% |
Stockholders Equity | 11% | 5.2% | 5.3% | -2.7% | -0.5% |
FCF | 5.6% | 21% | 28% | 54% | 6.2% |
The Revenue CAGR over the past 5 years is +6.41%.
The trend of Revenue growth rate over the past 5 years is +0.82%.
The Earnings CAGR over the past 5 years is -43.76%.
The trend of Earnings growth rate over the past 5 years is -127.99%.
The Equity CAGR over the past 5 years is +5.23%.
The trend of Equity growth rate over the past 5 years is -0.5%.
The FCF CAGR over the past 5 years is +20.78%.
The trend of FCF growth rate over the past 5 years is +6.24%.