One-glance verdict
Undervalued
$7.96 our estimate vs market $6.63
Wall Street consensus: $12.00 (50.8% higher than our fair-value estimate)
17% below our estimate, below the bear case
Fundamentals snapshot
Titan International, Inc.
TWI · NYQ · Industrials · Farm & Heavy Construction Machinery
Current price
$6.63
52-week range
$6.37 - $11.70
Market cap
$427.92M
Balance sheet
Distressed
0.54x Concerning
Net debt $536.90M. Interest coverage shows how many times profit covers the interest bill.
What stands out
2 Rewards
3 Risks
2 rewards · 3 risks
- Reward Revenue grew 2.1% last year.
- Reward Free cash flow was positive in 6/10 years.
- Risk Net debt grew 73.8% over 3 years.
- Risk Return on equity was -13.9% last year — the company lost money on shareholders' equity.
What this company does
Titan International, Inc.
Titan International makes wheels and tires for big machines used in farming, construction, and mining, earning most of its money from selling these parts to manufacturers of that equipment and also to repair shops. This is important because these sturdy tires and wheels are essential for the heavy-duty vehicles that help grow our food and build our infrastructure.
How the company got here
Titan International, Inc. has a long history, tracing its roots back to 1890. Over the decades, it has evolved into a key player in the off-highway equipment market. The company's journey has involved strategic growth and adaptation to the changing needs of industries like agriculture and construction. Today, it stands as a significant manufacturer of essential components for heavy machinery.
What it actually does
Titan International makes and sells wheels, tires, and undercarriage systems. Think of the big, tough tires on tractors, combines, and construction vehicles – Titan makes those, along with the wheels they attach to and the tracks or suspension systems on some heavy equipment. These parts are crucial for the machinery used in farming, building, and mining to operate effectively and reliably in demanding environments.
Agricultural
This segment focuses on providing wheels and tires specifically for agricultural machinery. This includes equipment like tractors, combines (harvesters), and irrigation systems. These products are designed to handle the unique challenges of farming, such as working in soft soil and covering large distances. Titan sells these under well-known brands, serving both the companies that build the farm equipment and the farmers who need replacement parts.
Earthmoving/Construction
In this business area, Titan supplies wheels, tires, and undercarriage components for a wide range of heavy-duty equipment used in construction, mining, and forestry. This covers everything from skid steers and excavators to large haul trucks and cranes. These parts need to be extremely durable to withstand the harsh conditions and heavy loads typical in these industries. Titan sells these directly to the manufacturers of this equipment and also to those who maintain and repair it.
Consumer
The consumer segment is where Titan produces wheels and tires for a variety of smaller vehicles and equipment. This includes items like those found on outdoor power equipment (like riding lawnmowers), powersports vehicles (such as ATVs), and high-speed trailers. While this segment might be smaller compared to the industrial ones, it represents another way Titan's products are used in everyday applications, often under brands like ITP and Goodyear.
What management is betting on now
Titan International's management is focused on strengthening its position in its core markets by continuing to supply essential components to the agricultural and construction industries. A key priority is likely ensuring a reliable supply chain (the network of companies and processes involved in making and delivering products) to meet customer demand. They are also probably looking for ways to innovate and improve their product offerings to maintain a competitive edge in these essential, yet cyclical, industries.
Price history
How the share price has moved
—
Loading price history…
Earnings history
Last 8 quarters — what happened
Click any quarter to read the call summary and what the numbers say.
FY2024 Q3
$41.79M
FY2024 Q4
$-4.57M
FY2025 Q1
$-53.62M
FY2025 Q2
$4.22M
FY2025 Q3
$29.89M
FY2025 Q4
$-5.08M
FY2026 Q1
$-59.78M
FY2026 Q2
$26.39M
Revenue
$484.77M
Net income
$5.76M
Diluted EPS
0.09
Operating cash flow
$39.15M
Free cash flow
$26.39M
Fetching…
Sources
Revenue
$505.07M
Net income
$-24.21M
Diluted EPS
-0.38
Operating cash flow
$-46.53M
Free cash flow
$-59.78M
Fetching…
Sources
Revenue
$410.44M
Net income
$-56.04M
Diluted EPS
-0.88
Operating cash flow
$12.79M
Free cash flow
$-5.08M
Fetching…
Sources
Revenue
$466.47M
Net income
$-2.26M
Diluted EPS
-0.04
Operating cash flow
$41.52M
Free cash flow
$29.89M
Fetching…
Sources
Revenue
$460.83M
Net income
$-4.54M
Diluted EPS
-0.07
Operating cash flow
$14.31M
Free cash flow
$4.22M
Fetching…
Sources
Revenue
$490.71M
Net income
$-649.00K
Diluted EPS
-0.01
Operating cash flow
$-38.59M
Free cash flow
$-53.62M
Fetching…
Sources
Revenue
$383.57M
Net income
$1.34M
Diluted EPS
-0.00
Operating cash flow
$8.74M
Free cash flow
$-4.57M
Fetching…
Sources
Revenue
$447.99M
Net income
$-18.25M
Diluted EPS
-0.25
Operating cash flow
$59.91M
Free cash flow
$41.79M
Fetching…
Sources
Is it cheap or expensive?
Fair value $7.96 vs current price $6.63
Wall Street consensus is the average analyst price target: $12.00 (50.8% higher than our fair-value estimate).
Our most-likely fair value is $7.96 a share — about 20.0% above today's price of $6.63, so the stock currently looks cheap (undervalued).
Is it drowning in debt?
Distressed
Net debt $536.9M. Interest coverage 0.5x.
Net debt
$536.90M
Interest coverage
0.54x
Titan International, Inc.'s profit covers its interest bill about 0.5 times over. which is weaker than most peers shown here and 1 peers sit below 1x, which is the danger zone where profit does not fully cover the interest bill.
Distressed
Worse cushion
Baseline
Better cushion
TWI
BASELINE
Titan International, Inc.
Total debt $716.68M Interest coverage 0.54x This is the baseline the peer rows are being compared against.
Total debt $137.29M Interest coverage 36.51x +6,707% vs TWI Carries about 68.1x more debt cushion than TWI.
Total debt $278.86M Interest coverage 10.19x +1,800% vs TWI Carries about 19.0x more debt cushion than TWI.
Total debt $393.40M Interest coverage 3.54x +560% vs TWI Carries about 6.6x more debt cushion than TWI.
Total debt $538.00M Interest coverage 1.56x +190% vs TWI Carries about 2.9x more debt cushion than TWI.
Total debt $6.48M Interest coverage 0.79x +47% vs TWI Carries about 1.5x more debt cushion than TWI.
What you should know
The case for and against TWI
2 Rewards
3 Risks
Rewards
-
Revenue grew 2.1% last year.
-
Free cash flow was positive in 6/10 years.
Risks
-
Net debt grew 73.8% over 3 years.
-
Return on equity was -13.9% last year — the company lost money on shareholders' equity.
-
Operating margin compressed from 11.0% to 3.0% over 3 years.
The numbers
All the key metrics, grouped by purpose
Tap any ? icon to learn what it means.
Valuation
How expensive the stock looks
P/E (TTM)
—
Forward P/E
22.86x
P/B
0.85x
P/S
0.23x
EV/EBITDA
10.28x
PEG ratio
11.70x
Profitability
How much profit each dollar creates
Gross margin
13.4%
Operating margin
3.0%
Net margin
-4.1%
ROE
-13.9%
ROA
0.9%
Health
Liquidity and balance-sheet strength
Debt / equity
1.41x
Current ratio
2.11x
Quick ratio
1.00x
Total debt
$716.68M
Total cash
$179.78M
Growth
How the business has been compounding
Revenue TTM
$1.87B
Revenue 5Y CAGR
0.7%
EPS TTM
-1.21
EPS 5Y CAGR
—
Cash flow
How much cash the business throws off
Operating CF TTM
$46.93M
Free CF TTM
$-24.59M
FCF margin
-1.3%
Dividend
Shareholder payout
Yield
0.0%
Payout ratio
0.0%
Last ex-div date
2020-03-30