Target Hospitality Corp. (TH) vs Transcat, Inc. (TRNS)

Target Hospitality Corp. and Transcat, Inc. are both Specialty Business Services companies. Target Hospitality Corp. is the larger, with a market value of $1.0B against $944.1M — 1.1× the size. Target Hospitality Corp. has negative trailing earnings, so its P/E is not meaningful; Transcat, Inc. trades at 208×. Transcat, Inc. grew revenue faster over the last twelve months: 20.0% against 11.9%. Transcat, Inc. has the higher net margin (1.26% vs −10.9%) and the higher return on invested capital (1.96% vs −5.94%). Across the 21 metrics below, Transcat, Inc. leads on 17 and Target Hospitality Corp. on 4.

Valuation

Metric TH TRNS Specialty Business Services median
P/E n/m 207.62 24.48
P/S 3.04 2.61 1.09
P/B 2.85 3.07 2.23
Price to free cash flow 101.09 41.33 16.92
EV/EBITDA 30.71 25.76 10.82
EV/Sales 3.66 2.92 1.47
Earnings yield (3.59%) 0.48% 1.88%
Free cash flow yield 0.99% 2.42% 1.36%

Profitability

Metric TH TRNS Specialty Business Services median
Gross margin 13.73% 32.79% 31.71%
Operating margin (11.10%) 3.63% 3.53%
Net margin (10.85%) 1.26% 1.88%
Free cash flow margin 3.00% 6.32% 3.18%
Return on equity (9.78%) 1.52% 0.00%
Return on assets (6.34%) 0.93% 0.00%
Return on invested capital (5.94%) 1.96% 0.00%

Growth

Metric TH TRNS Specialty Business Services median
Revenue growth (TTM) 11.92% 20.04% 6.04%
EPS growth (last fiscal year) (152.86%) (63.69%) 3.41%
Revenue growth, 5-year CAGR 7.33% 13.87% 7.60%
Net income growth, 5-year CAGR 0.00% (7.15%) 0.00%

Health

Metric TH TRNS Specialty Business Services median
Debt to equity 0.11 0.38 0.24
Current ratio 0.65 2.57 1.79
Net debt to EBITDA (0.17) 2.40 0.69

Dividend

Metric TH TRNS Specialty Business Services median
Dividend yield — — 2.19%
Payout ratio — — 0.37

Size

Metric TH TRNS Specialty Business Services median
Market cap 1.04b 944.06m 704.72m

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