TOD'S S.p.A. (TOD.MI) | Investment Case

1. Company Snapshot

1.a. Company Description

TOD'S S.p.A., together with its subsidiaries, creates, produces, and distributes shoes, leather goods and accessories, and apparel in Italy, rest of Europe, the Americas, Greater China, and internationally.The company distributes its products through directly operated single-brand stores (DOS), online, franchised stores, and independent multi-brand stores under the TOD'S, HOGAN, FAY, and ROGER VIVIER brands.As of March 10, 2022, it operated through a distribution network of 318 DOS and 88 franchised stores.

The company was founded in 1970 and is headquartered in Sant'Elpidio a Mare, Italy.TOD'S S.p.A. is a subsidiary of DI.VI.FINANZIARIA DI DIEGO DELLA VALLE & C.

S.r.l.

Show Full description

1.b. Last Insights on TOD

Tod's S.p.A. experienced a 0.0% performance over the past 3 months, driven by the company's delisting from the Milan stock exchange following a successful tender offer by L Catterton. The private equity firm's investment is expected to yield double-digit returns, as Tod's focuses on quiet luxury and craftsmanship. The brand's commitment to social causes, such as earthquake relief, has also contributed to its stable performance.

1.c. Company Highlights

Last Price	42.96
Change Percentage	-0.05%
Open	42.9
Previous Close	42.98
Market Cap ( Millions)	1422
Volume	20561
Year High	45.56
Year Low	30
M A 50	42.94
M A 200	37.39

FCF Yield	5.43%
Dividend Yield	0.00%
ROE	4.69%
Debt / Equity	63.98%
Net Debt / EBIDTA	238.18%
Price To Book	1.3
Price Earnings Ratio	28.45
Price To FCF	18.42
Price To sales	1.24
EV / EBITDA	7.91

2. Transcript Summary

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3. NewsRoom

Tod’s Diego and Andrea Della Valle Receive Arquata del Tronto Honorary Citizenship

May -31

Source:

Italian shoemaker Tod's to court US lovers of quiet luxury

May -07

Source:

Tod’s Group to Delist on May 8

May -04

Source:

Tod’s Unveils Exhibit Celebrating Venetian Craftsmanship

Apr -20

Source:

L Catterton Receives Green Light to Launch Tender Offer on Tod’s Stock

Mar -22

Source:

Fanciful Details, Craftsmanship, New Colors: What Buyers Want for Fall From Milan

Feb -26

Source:

Tod's CEO says he has no plans to sell 'family business'

Feb -23

Source:

Stocks to Watch Monday: Diamondback, CymaBay, Gilead, Tod's

Feb -12

Source:

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (3.59%)

6. Segments

Shoes

Expected Growth: 3.5%

TOD'S S.p.A. shoes' 3.5% growth driven by increasing demand for luxury goods, expansion in Asia-Pacific, and strategic investments in e-commerce and digital marketing. Additionally, the brand's focus on quality, craftsmanship, and stylish designs resonates with consumers seeking premium products, contributing to the segment's growth.

Leather Goods

Expected Growth: 3.8%

TOD'S S.p.A.'s 3.8% growth in Leather Goods is driven by increasing demand for luxury goods, particularly in Asia, and the company's successful brand diversification strategy. Additionally, the company's focus on e-commerce and omnichannel retailing has improved sales and customer engagement.

Apparel

Expected Growth: 4.2%

TOD'S S.p.A.'s 4.2% apparel growth driven by increasing demand for luxury goods, successful brand diversification, and strategic expansion into Asia-Pacific markets. Additionally, the company's focus on e-commerce and omnichannel retailing has enhanced customer experience, contributing to the growth.

Other

Expected Growth: 3.2%

TOD'S S.p.A.'s 3.2% growth in the 'Other' segment is driven by increasing demand for luxury leather goods, successful brand diversification, and strategic expansion into emerging markets. Additionally, the company's focus on e-commerce and digital marketing has contributed to the growth, along with a favorable product mix and pricing strategy.

7. Detailed Products

Tod's Shoes

Luxury leather shoes for men and women, including loafers, boots, sneakers, and sandals

Hogan Shoes

Casual and stylish shoes for men and women, including sneakers, boots, and sandals

Roger Vivier Shoes

Luxury shoes for women, including high heels, flats, and boots

Tod's Handbags

Luxury leather handbags for men and women, including totes, shoulder bags, and clutches

Hogan Handbags

Casual and stylish handbags for men and women, including backpacks, totes, and shoulder bags

Roger Vivier Handbags

Luxury handbags for women, including clutches, totes, and shoulder bags

Tod's Small Leather Goods

Luxury leather accessories, including wallets, keychains, and card holders

Hogan Small Leather Goods

Casual and stylish leather accessories, including wallets, keychains, and card holders

8. TOD'S S.p.A.'s Porter Forces

Forces Ranking

Threat Of Substitutes

TOD'S S.p.A. operates in the luxury goods industry, where substitutes are limited. However, there is a growing trend towards sustainable and affordable fashion, which could pose a threat to the company's high-end products.

Bargaining Power Of Customers

TOD'S S.p.A. targets a niche market of high-end consumers who are willing to pay premium prices for luxury goods. This reduces the bargaining power of customers.

Bargaining Power Of Suppliers

TOD'S S.p.A. relies on a network of suppliers for raw materials and components. While the company has some bargaining power due to its size, suppliers may still have some negotiating power.

Threat Of New Entrants

The luxury goods industry has high barriers to entry, including high capital requirements and the need for established brand recognition. This makes it difficult for new entrants to compete with TOD'S S.p.A.

Intensity Of Rivalry

The luxury goods industry is highly competitive, with many established brands competing for market share. TOD'S S.p.A. faces intense rivalry from other luxury brands, which can lead to pricing pressure and advertising wars.

9. SWOT Analysis

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

	Value
Debt Weight	20.38%
Debt Cost	4.52%
Equity Weight	79.62%
Equity Cost	8.34%
WACC	7.56%
Leverage	25.60%

11. Quality Control: TOD'S S.p.A. passed 4 out of 9 key points

Strong Liquidity

Low Debt

Strong Interest Coverage

Healthy Cash Flow

Operating Efficiency

Strong Return On Equity

Consistent Revenue Growth

Consistent Operating Cash Flow Growth

Margin Improvement

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

CEWE

A-Score: 6.5/10

Value: 6.9

Growth: 5.7

Quality: 7.5

Yield: 5.0

Momentum: 4.0

Volatility: 9.7

1-Year Total Return ->

Villeroy & Boch

A-Score: 5.6/10

Value: 7.7

Growth: 3.9

Quality: 3.2

Yield: 8.8

Momentum: 3.0

Volatility: 7.3

1-Year Total Return ->

Dr. Martens

A-Score: 4.9/10

Value: 4.9

Growth: 4.0

Quality: 3.9

Yield: 5.6

Momentum: 10.0

Volatility: 1.0

1-Year Total Return ->

KABE

A-Score: 4.6/10

Value: 6.4

Growth: 4.0

Quality: 4.2

Yield: 5.0

Momentum: 0.5

Volatility: 7.7

1-Year Total Return ->

Delta Plus

A-Score: 4.2/10

Value: 6.7

Growth: 6.0

Quality: 4.8

Yield: 2.5

Momentum: 1.0

Volatility: 4.0

1-Year Total Return ->

TOD'S

A-Score: 3.5/10

Value: 5.0

Growth: 5.8

Quality: 3.5

Yield: 0.0

Momentum: 4.0

Volatility: 3.0

1-Year Total Return ->

Peers Metrics

12.e Scoring ^Insights

12.f DCF ^BETA

Parameters

Short Term Growth

4.46%

Short term Time

10.0

Long-Term Growth

2.00%

WACC

7.56%

TOD'S S.p.A. - IT0003007728

1. Company Snapshot

1.a. Company Description

1.b. Last Insights on TOD

1.c. Company Highlights

Lower Yield

Stable Momentum

Fairly Valued

Medium Volatility

Lower Growth

Strong Momentum

Earnings Beats

Revenues Beats

Average Quality

2. Transcript Summary

3. NewsRoom

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (3.59%)

6. Segments

Shoes

Expected Growth: 3.5%

Leather Goods

Expected Growth: 3.8%

Apparel

Expected Growth: 4.2%

Other

Expected Growth: 3.2%

7. Detailed Products

Tod's Shoes

Hogan Shoes

Roger Vivier Shoes

Tod's Handbags

Hogan Handbags

Roger Vivier Handbags

Tod's Small Leather Goods

Hogan Small Leather Goods

8. TOD'S S.p.A.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Bargaining Power Of Customers

Bargaining Power Of Suppliers

Threat Of New Entrants

Intensity Of Rivalry

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

11. Quality Control: TOD'S S.p.A. passed 4 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

42.96$

Current Price

42.96$

Potential

-0.00%

Expected Cash-Flows

12.e Scoring ^Insights

12.f DCF ^BETA