Titan Machinery Inc. (TITN): One Attractive Small Cap Worth a Look

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Looking at figures best remembered

Given these positive factors, CNH is a likely choice for value investors looking for a big cap option in the farm machinery sector. It currently trades at just about eight times its earnings. Nevertheless, its negative levered cash flow as shown in the table below can be a turnoff.

CNH Alamo Group Titan
Market Cap $10 billion $485 million $404 million
P/E (ttm) 8.32 16.28 11.90
Total Cash (mrq) $4.98 billion $33.49 million $114.25 million
Total Debt (mrq) $18.67 billion $10.62 million $957.05 million
Operating Cash Flow (ttm) $1.24 billion $48.67 million −$96.79 million
Levered Free Cash Flow (ttm) −$2.15 billion $44.59 million −$172,30 million

ttm: trailing twelve-month; mrq: most recent quarter

A summation for the small caps

Using the same metrics drawn from Yahoo Finance, Alamo Group looks a better pick against its small-cap peer, Titan Machinery Inc. (NASDAQ:TITN). Moreover, the balance sheet and cash flow are not only healthier for Alamo. The company’s shares, with a current consensus target price of $43.50, for the most part of June have been trading under the $40 mark, which looks like a good entry level as this equity rallies along with the rise in farm capex.

With the U.S. relying on the rest of the world for such a large percentage of our goods, many investors are ready for the end of the “made in China” era.

The article 1 Attractive Small Cap Worth a Look originally appeared on Fool.com and is written by Arturo Cuevas.

Arturo Cuevas has no position in any stocks mentioned. The Motley Fool owns shares of Alamo Group. Arturo is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.

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