Reasonable Price-to-Earnings Ratio
Strong Price-to-Sales Ratio
Strong Return on Equity
Healthy Profit Margins
Low Debt-to-Equity Ratio
Strong Interest Coverage
🏆 Strong Financial Performance
🔑 Competitive Positioning
💰 Effective Capital Deployment
🚀 Positive Growth Outlook
🏗️ Innovation and Transformation Initiatives
High Price-to-Book Ratio
Elevated EV/EBITDA Ratio
Moderate Operating Profit Margin
Liquidity Concerns
📉 Organic Volume Challenges
📉 Telecom Market Uncertainty
Hubbell Incorporated demonstrates a strong business model with effective capital management and competitive positioning in its sectors. However, challenges in organic volume growth and the telecom market may pose risks to future performance. Overall, the company is well-positioned for growth through its strategic initiatives and market opportunities.
Analysis Date: February 4, 2025
Last Updated: March 12, 2025
Trailing Twelve Months (TTM) values provide a view of the company's performance over the last year.
Benjamin Graham's value investing approach focuses on finding stocks with a significant margin of safety between their intrinsic value and market price.
Intrinsic Value
Estimated fair value based on Graham's formula
$553.30
Current Market Price: $312.74
IV/P Ratio: 1.77x (>1.0 indicates undervalued)
Margin of Safety
Gap between intrinsic value and market price
43.0%
Graham recommended a minimum of 20-30% margin of safety
Higher values indicate a greater potential discount to fair value
Graham Criteria Checklist
Benjamin Graham's value investing checklist for HUBB
Positive earnings (5+ years)
Dividend history (5+ years)
P/E ratio ≤ 20 (21.98)
P/B ratio ≤ 1.5 (5.21)
Current ratio ≥ 2.0 (1.64x)
Long-term debt < Net current assets (1.91x)
Margin of safety (43.0%)
HUBB does not meet all Graham criteria
Trailing Twelve Months (TTM) values provide a view of the company's performance over the last year.
HUBB exhibits a robust return on equity (ROE) of 24.93%, indicating effective management in generating profits from shareholders' equity.
The company boasts a net profit margin of 13.82%, which demonstrates solid profitability relative to its sales.
An operating profit margin of 19.57% is decent, but improvements could be made to enhance operational efficiency.
Profitability metrics measure a company's ability to generate earnings relative to its revenue, operating costs, and other relevant metrics. Higher values generally indicate better performance.
Return on Equity (ROE)
Measures how efficiently a company uses its equity to generate profits
24.93%
Higher values indicate better returns for shareholders
TTM (as of 2025-04-16)
Return on Assets (ROA)
Measures how efficiently a company uses its assets to generate profits
2.95%
Higher values indicate better asset utilization
TTM (as of 2025-04-16)
Gross Profit Margin
Percentage of revenue retained after accounting for cost of goods sold
33.95%
Higher values indicate better efficiency in production
TTM (as of 2025-04-16)
Net Profit Margin
Percentage of revenue retained after accounting for all expenses
13.82%
Higher values indicate better overall profitability
TTM (as of 2025-04-16)
With a debt-to-equity ratio of 0.52, HUBB maintains a conservative approach towards leverage, providing stability and reduced financial risk.
An interest coverage ratio of 14.92 indicates that the company can easily meet its interest obligations, highlighting its financial stability.
The quick ratio of 0.98 suggests that HUBB may face challenges in covering its short-term liabilities without selling inventory, indicating potential liquidity issues.
Financial health metrics assess a company's ability to meet its financial obligations and its overall financial stability.
Debt to Equity Ratio
Total debt divided by total equity
0.52x
Lower values indicate less financial leverage and risk
Less than 1.0 is conservative, 1.0-2.0 is moderate, >2.0 indicates high risk
Q4 2024
Current Ratio
Current assets divided by current liabilities
1.64x
Higher values indicate better short-term liquidity
Less than 1.0 is concerning, 1.0-2.0 is adequate, greater than 2.0 is good
Q4 2024
Hubbell reported strong double-digit growth in adjusted operating profit, adjusted earnings per share (EPS), and free cash flow. The adjusted EPS of $16.57 exceeded initial guidance, showcasing effective management and operational efficiency.
The company has a strong market position in Electrical and Utility Solutions, benefiting from above-market growth in specific sectors like transmission and renewables. Their unified strategy has improved customer relations and operational efficiency.
Hubbell effectively managed its capital through acquisitions such as Systems Control, contributing positively to its revenue and margin outlook. The strong balance sheet supports continued investment and growth.
Organic volumes were below expectations, indicating potential weakness in demand. The company faced challenges in the telecom market and utility customer destocking, which could impact future growth.
Hubbell anticipates mid-single-digit organic growth for 2025, driven by capitalizing on electrification trends and growth in high-margin utility markets. The outlook reflects confidence in overcoming prior headwinds.
The ongoing transformation in Electrical Solutions is expected to yield significant growth, especially in high-demand sectors like data centers and renewables. The company is focused on operational efficiencies and competitive pricing.
The telecom business continues to face challenges, with significant sales declines impacting overall growth potential. The company aims to stabilize and grow this segment without returning to previous high-volume levels, indicating cautious optimism.