Ingersoll Rand Inc. (IR) vs Illinois Tool Works Inc. (ITW)

Ingersoll Rand Inc. and Illinois Tool Works Inc. are both Specialty Industrial Machinery companies. Illinois Tool Works Inc. is the larger, with a market value of $81.1B against $31.4B — 2.6× the size. Ingersoll Rand Inc. trades at the lower P/E: 22.9× against 25.4×. Ingersoll Rand Inc. grew revenue faster over the last twelve months: 7.96% against 4.80%. Illinois Tool Works Inc. has the higher net margin (19.4% vs 17.2%) and the higher return on invested capital (23.7% vs 8.25%). Both pay a dividend; Illinois Tool Works Inc. yields more (2.30% vs 0.10%). Across the 23 metrics below, Ingersoll Rand Inc. leads on 13 and Illinois Tool Works Inc. on 10.

Valuation

Metric IR ITW Specialty Industrial Machinery median
P/E 22.94 25.38 25.64
P/S 3.92 4.88 2.81
P/B 2.99 25.85 2.99
Price to free cash flow 20.76 28.21 23.82
EV/EBITDA 14.59 18.59 15.15
EV/Sales 4.35 5.39 2.77
Earnings yield 4.36% 3.94% 3.07%
Free cash flow yield 4.82% 3.55% 3.67%

Profitability

Metric IR ITW Specialty Industrial Machinery median
Gross margin 43.09% 44.32% 35.46%
Operating margin 22.88% 26.61% 10.04%
Net margin 17.20% 19.39% 7.24%
Free cash flow margin 18.90% 17.30% 9.04%
Return on equity 13.34% 101.65% 10.73%
Return on assets 7.53% 19.78% 4.51%
Return on invested capital 8.25% 23.65% 5.00%

Growth

Metric IR ITW Specialty Industrial Machinery median
Revenue growth (TTM) 7.96% 4.80% 6.59%
EPS growth (last fiscal year) (29.61%) (10.42%) 5.97%
Revenue growth, 5-year CAGR 14.00% 4.99% 8.53%
Net income growth, 5-year CAGR 0.00% 7.77% 6.58%

Health

Metric IR ITW Specialty Industrial Machinery median
Debt to equity 0.45 2.98 0.33
Current ratio 1.69 1.29 2.08
Net debt to EBITDA 1.84 1.76 1.32

Dividend

Metric IR ITW Specialty Industrial Machinery median
Dividend yield 0.10% 2.30% 1.11%
Payout ratio 0.02 0.58 0.31

Size

Metric IR ITW Specialty Industrial Machinery median
Market cap 31.43b 81.11b 2.19b

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