SNA

Snap-On Inc

Industrial/Transportation


Presented:03/28/2016
Price:$158.10
Cap:$9.36B
Current Price:$295.68
Cap:$15.58B

Presented

Date03/28/2016
Price$158.10
Market Cap$9.36B
Ent Value$10.98B
P/E Ratio19.52x
Book Value$41.54
Div Yield1.54%
Shares O/S59.20M
Ave Daily Vol586,527
Short Int3.99%

Current

Price$295.68
Market Cap$15.58B
Snap-On, Inc. develops, manufactures and markets tools, equipment, diagnostics, repair information and systems solutions for professional users. It operates its business through following segments: Commercial and Industrial Group; Snap-On Tools Group; Repair Systems and Information Group; and Financial Services. The Commercial and Industrial Group segment refers to a range of industrial and commercial customers worldwide, primarily through direct and distributor channels. The Snap-On Tools Group segment provides vehicle service and repair technicians through the company's worldwide mobile tool distribution channel. The Repair System and Information Group segment serves other professionals vehicle repair customers worldwide, primarily owners and managers of independent repair shops and OEM dealerships through direct and distributor channels. The Financial Services segment consists of the business operations of Snap-On Credit LLC, the company's financial services business in the United States, and Snap-On's other financial services subsidiaries in those international markets where Snap-On has franchise operations. The company was founded by Joseph Johnson and William Seidemann in 1920 and is headquartered in Kenosha, WI.

Publicly traded companies mentioned herein: Snap-on Inc (SNA)

Highlights

The presenter is short shares of Snap-on (SNA) and sees the potential for the stock to trade down to $110 from ~$155 today. The market for tools, diagnostics and other services provided to mechanics and repair shops (including dealership OEMs) is evolving, and with new product introductions waning and macro trends favoring auto dealer service centers he believes SNA’s Tools business could see organic growth revert to more normalized levels (4% - 6%) from the current low double digit (~11%) pace. If this occurs, earnings are likely to fall short of the Street’s 2016 EPS forecast (~$8.90) and the multiple could contract to the mid-teens.

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Idea Discussion

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