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Nvent Electric (NVT)
:NVT
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nVent Electric
(NYSE:NVT)
66Neutral
Positive Factors
Acquisition Impact
The acquisition of Electrical Products Group is expected to be accretive to adjusted EPS in the first year following the completion of the transaction.
Earnings Forecast
Continued strong margin execution is expected, with earnings forecasts rising 5% or more once the pending EPG deal closes.
Negative Factors
Stock Reaction
The stock reacted poorly, with a decline of 8% versus a nearly unchanged S&P on the day of the Q3 report.
Valuation Concerns
Some investors highlighted that the valuation of NVT is not cheap following its run-up, with the stock closing at a 2024 P/E of 27X.
nVent Electric (NVT) vs. S&P 500 (SPY)
Market Cap
$9.43B
Dividend Yield1.35%
Average Volume (3M)2.37M
Price to Earnings (P/E)29.0
Beta (1Y)1.86
Revenue Growth0.78%
EPS Growth-41.54%
CountryUS
Employees12,100
SectorIndustrials
Sector Strength70
IndustryElectrical Equipment & Parts
Share Statistics
EPS (TTM)1.97
Shares Outstanding165,022,140
10 Day Avg. Volume2,498,401
30 Day Avg. Volume2,369,709
Financial Highlights & Ratios
PEG Ratio0.97
Price to Book (P/B)N/A
Price to Sales (P/S)3.14
Price to Cash Flow (P/CF)10.50
P/FCF Ratio11.50
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$81.83Price Target Upside39.67% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering8
nVent Electric Business Overview & Revenue Model
Company DescriptionnVent Electric plc designs, manufactures, markets, installs, and services electrical connection and protection products worldwide. The company operates through three segments: Enclosures, Electrical & Fastening Solutions, and Thermal Management. The Enclosures segment provides solutions to connect and protect critical electronics, communication, control, and power equipment; physical infrastructure solutions to host, connect, and protect server and network equipment; and indoor and outdoor protection for test and measurement and aerospace and defense applications in industrial, infrastructure, commercial, and energy verticals. Its products also include metallic and non-metallic enclosures, cabinets, sub racks, and backplanes. The Electrical & Fastening Solutions segment offers fastening solutions to connect and protect electrical and mechanical systems, and civil structures. It also provides engineered electrical and fastening products. The Thermal Management segment offers electric thermal solutions that connect and protect buildings, infrastructure, industrial processes, and people. This segment provides thermal management systems comprising heat tracing, floor heating, fire-rated and specialty wiring, sensing, and snow melting and de-icing solutions. The company sells its products under the CADDY, ERICO, HOFFMAN, RAYCHEM, SCHROFF, and TRACER brands. nVent Electric plc markets its products through electrical distributors, data center contractors, original equipment manufacturers, and maintenance contractors. It serves the energy, industrial, infrastructure, and commercial and residential sectors. The company was founded in 1903 and is based in London, the United Kingdom.
How the Company Makes MoneynVent Electric makes money through the sale of its diverse range of products that are essential for electrical connection and protection across multiple industries. The company's revenue model is primarily based on direct sales to distributors, original equipment manufacturers (OEMs), and end-users. Key revenue streams include its enclosures segment, which provides robust and secure solutions for housing electrical components, and its thermal management segment, which offers critical systems for temperature regulation of electrical and electronic equipment. Additionally, nVent maintains significant partnerships with major distributors and leverages its global presence to drive sales and expand market reach, contributing to its overall earnings.
nVent Electric Financial Statement Overview
Summary
nVent Electric has shown consistent revenue growth and strong profitability indicators. However, there are concerns about rising debt levels and a decrease in free cash flow growth, which could affect financial flexibility. Maintaining operational efficiency and managing leverage will be crucial for sustained growth.Income Statement
nVent Electric has demonstrated consistent revenue growth over the years, with a notable increase from 2020 to 2023. The gross profit margin in 2023 was approximately 41.1%, and the net profit margin was around 10.2%, indicating a stable profitability profile. However, there was a decline in both EBIT and EBITDA margins compared to the previous year, which suggests a need for improved operational efficiency.75
Positive
Balance Sheet
The company's debt-to-equity ratio increased in 2023, reflecting higher leverage and potential risks associated with debt management. The equity ratio remains healthy at around 51%, supporting a stable capital structure. Return on equity was approximately 18%, showcasing strong profitability relative to shareholders' equity. Nonetheless, rising debt levels could pressure the balance sheet if not managed carefully.70
Positive
Cash Flow
Operating cash flow has remained robust, though a slight decrease was observed in 2023. The free cash flow to net income ratio signals efficient cash generation relative to profits. However, a significant drop in free cash flow growth rate in 2023 highlights potential challenges in liquidity management. The operating cash flow to net income ratio remains healthy, suggesting strong cash earnings quality.68
Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 3.01B | 3.26B | 2.91B | 2.46B | 2.00B | Gross Profit |
| 1.21B | 1.34B | 1.10B | 941.90M | 749.40M | EBIT |
| 527.10M | 587.40M | 440.40M | 355.40M | 247.40M | EBITDA |
| 681.20M | 720.30M | 618.00M | 484.60M | 370.90M | Net Income Common Stockholders |
| 331.80M | 567.10M | 399.80M | 272.90M | -47.20M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 131.20M | 185.10M | 297.50M | 49.50M | 122.50M | Total Assets |
| 6.73B | 6.16B | 4.90B | 4.67B | 4.37B | Total Debt |
| 2.27B | 1.90B | 1.08B | 999.20M | 948.00M | Net Debt |
| 2.14B | 1.72B | 785.70M | 949.70M | 825.50M | Total Liabilities |
| 3.50B | 3.02B | 2.17B | 2.18B | 1.96B | Stockholders Equity |
| 3.24B | 3.14B | 2.73B | 2.50B | 2.41B |
| Cash Flow | Free Cash Flow | |||
| 427.00M | 457.10M | 348.70M | 333.80M | 304.00M | Operating Cash Flow |
| 501.00M | 528.10M | 394.60M | 373.30M | 344.00M | Investing Cash Flow |
| -758.40M | -1.16B | -52.50M | -274.00M | -65.00M | Financing Cash Flow |
| 146.20M | 516.70M | -82.10M | -166.80M | -272.50M |
nVent Electric Technical Analysis
Neutral
58.59
Price Trends
63.34
Negative
68.48
Negative
69.64
Negative
Market Momentum
-1.84
Negative
48.64
Neutral
87.67
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For NVT, the sentiment is Neutral. The current price of 58.59 is above the 20-day moving average (MA) of 56.81, below the 50-day MA of 63.34, and below the 200-day MA of 69.64, indicating a neutral trend. The MACD of -1.84 indicates Negative momentum. The RSI at 48.64 is Neutral, neither overbought nor oversold. The STOCH value of 87.67 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for NVT.
nVent Electric Risk Analysis
nVent Electric disclosed 35 risk factors in its most recent earnings report. nVent Electric reported the most risks in the “Legal & Regulatory” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
nVent Electric Peers Comparison
Overall Rating
UnderperformOutperform
Sector (62)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
78 Outperform | $73.77B | 21.46 | 110.24% | 2.31% | -1.30% | 20.26% | |
74 Outperform | $115.74B | 31.10 | 20.23% | 1.27% | 7.25% | 18.36% | |
72 Outperform | $63.78B | 26.90 | 9.66% | 1.86% | 10.29% | 22.72% | |
71 Outperform | $18.13B | 23.54 | 25.26% | 1.50% | 4.76% | 2.27% | |
69 Neutral | $29.26B | 32.20 | 26.22% | 1.98% | -11.28% | -23.69% | |
66 Neutral | $9.43B | 28.96 | 8.73% | 1.35% | 0.78% | -41.54% | |
62 Neutral | $8.27B | 14.03 | 2.36% | 3.08% | 3.85% | -14.32% |
* Industrials Sector Average
Performance Comparison
NVT
nVent Electric
58.59
-15.56
-20.98%
ETN
Eaton
302.84
-5.27
-1.71%
EMR
Emerson Electric Company
115.37
5.41
4.92%
HUBB
Hubbell B
349.50
-58.62
-14.36%
ITW
Illinois Tool Works
255.64
-3.86
-1.49%
ROK
Rockwell Automation
267.96
-11.27
-4.04%
nVent Electric Earnings Call Summary
Earnings Call Date: Feb 6, 2025 | % Change Since: -7.85% | Next Earnings Date: Apr 25, 2025
Earnings Call Sentiment Positive
The call highlighted strong financial performance and strategic portfolio transformations, with significant growth in the data solutions and infrastructure segments. However, challenges in organic sales growth and regional performance were noted. The outlook for 2025 is optimistic with expected strong sales and earnings growth.Highlights
Strong Revenue and Earnings Growth
Fourth-quarter sales were up 9%, with a full-year increase of 13%. Adjusted EPS grew 7% for both Q4 and the full year.
Record Free Cash Flow
The company generated $150 million in free cash flow for Q4 and $427 million for the full year, growing 20% year over year.
Significant Portfolio Transformation
The sale of the Thermal Management business was completed, freeing up nearly $2 billion in capital for 2025.
Data Solutions Growth
Data solutions sales grew approximately 30% in 2024 and are projected to continue double-digit growth in 2025.
Infrastructure and Energy Segments Leading Growth
Infrastructure sales grew low single digits and energy sales were up mid-teens for Q4.
Lowlights
Decline in Organic Sales
Q4 organic sales were down 1%, with some verticals such as commercial resi declining mid-single digits.
Inventory Adjustments Impacting Sales
Sales to key distribution partners were down more than expected due to inventory management, impacting the organic sales figures.
Mixed Regional Performance
North America saw a low single-digit decline in organic sales, while Europe had slight growth, and Asia Pacific grew in the mid-teens.
Company Guidance
During the call, nVent Electric plc provided guidance for 2025, highlighting several key metrics. The company anticipates approximately 9% sales growth and a 22% increase in adjusted earnings per share at the midpoint of their guidance range. For the full year of 2024, nVent reported $3 billion in sales, marking a 13% increase with 2% organic growth. The fourth quarter alone saw a 9% rise in reported sales, although organic sales were slightly down. The company achieved a 7% growth in adjusted EPS for both Q4 and the full year. nVent also generated $427 million in free cash flow for 2024, reflecting a 20% increase and a 102% conversion of adjusted net income. Looking ahead, nVent expects its infrastructure vertical to grow the fastest in 2025, with projected low double-digit growth, while industrial and commercial resi are expected to see low to mid-single-digit growth. The company also plans to launch over 75 new products, contributing more than two points to sales growth, and maintain a strong focus on acquisitions and share repurchases, with nearly $2 billion available for capital deployment.nVent Electric Corporate Events
Executive/Board Changes
nVent Electric Appoints Gary Corona as New CFO
Positive
Mar 11, 2025
nVent Electric plc has announced the appointment of Gary Corona as its new Executive Vice President and Chief Financial Officer, effective March 31, 2025. This leadership change is significant as it brings in Mr. Corona, who has a robust background in finance with previous roles at Medtronic and General Mills, to strengthen nVent’s financial operations. His compensation package includes a base salary, incentive opportunities, and stock units, reflecting the company’s investment in his leadership to potentially enhance its market position.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.