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1. Company Snapshot

1.a. Company Description

Snap-on Incorporated manufactures and markets tools, equipment, diagnostics, and repair information and systems solutions for professional users worldwide.It operates through Commercial & Industrial Group, Snap-on Tools Group, Repair Systems & Information Group, and Financial Services segments.The company offers hand tools, including wrenches, sockets, ratchet wrenches, pliers, screwdrivers, punches and chisels, saws and cutting tools, pruning tools, torque measuring instruments, and other products; power tools, such as cordless, pneumatic, hydraulic, and corded tools; and tool storage products comprising tool chests, roll cabinets, and other products.


It also provides handheld and computer-based diagnostic products, service and repair information products, diagnostic software solutions, electronic parts catalogs, business management systems and services, point-of-sale systems, integrated systems for vehicle service shops, original equipment manufacturer purchasing facilitation services, and warranty management systems and analytics.In addition, the company offers solutions for the service of vehicles and industrial equipment that include wheel alignment equipment, wheel balancers, tire changers, vehicle lifts, test lane equipment, collision repair equipment, vehicle air conditioning service equipment, brake service equipment, fluid exchange equipment, transmission troubleshooting equipment, safety testing equipment, battery chargers, and hoists, as well as after-sales support services and training programs.Further, it provides financing programs to facilitate the sales of its products and support its franchise business.


The company serves the aviation and aerospace, agriculture, construction, government and military, mining, natural resources, power generation, and technical education industries, as well as vehicle dealerships and repair centers.Snap-on Incorporated was founded in 1920 and is based in Kenosha, Wisconsin.

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1.b. Last Insights on SNA

The recent 3-month performance of Snap-on Incorporated was driven by a rebound in its Tools Group segment, with strong sales and resilient margins despite a year-over-year earnings decline. The company's ability to navigate macro headwinds, including tariffs and high interest rates, was a key positive driver. Additionally, Snap-on's U.S.-centric operations and potential onshoring trends position it to benefit from manufacturing shifts back to the U.S., supporting future growth. The company's flat revenues and organic sales decline were offset by a strong Q2 earnings beat, with diluted EPS of $4.72.

1.c. Company Highlights

2. Snap-on's Q3 Earnings: A Strong Performance

Snap-on Incorporated reported a robust third-quarter performance, with sales reaching $1,190,800,000, up 3.8% from the previous year, driven by organic sales growth of 3%. The operating income margin was 23.4%, including a 190 basis point benefit from a recent legal settlement, and 21.5% excluding that item. Earnings per share (EPS) was $5.02, or $4.71 excluding the one-time legal benefit, beating analyst estimates of $4.59.

Publication Date: Oct -17

📋 Highlights
  • Strong Organic Sales Growth:: Organic sales increased 3% year-over-year, with the RS&I group reporting 8.9% growth driven by OEM dealerships and diagnostics.
  • Legal Settlement Impact:: Operating margin of 23.4% included a $22M legal settlement benefit, reducing to 21.5% when excluded, while EPS was $5.02 ($4.71 without the settlement).
  • High Gross Margins:: Gross margin reached 50.9% overall, with the C&I segment maintaining resilience at 40.9% despite 0.8% organic sales decline.
  • Robust Cash Flow:: Generated $278M in operating cash flow and maintained $1.53B in cash, with 2025 CapEx expected at $100M.
  • Segment Momentum:: Tools Group saw 1% organic growth and 21.7% operating margin, while diagnostics within RS&I achieved double-digit growth, offsetting weaker hand tool sales.

Segment Performance

The company's markets showed encouraging momentum, with the auto repair market remaining favorable due to the aging car park and increasing complexity. The critical industries segment saw growth, driven by customized products, and the tools group showed organic sales growth of 1%. The repair systems and information group saw sales rise 10%, driven by higher activity with OEM dealerships and increased sales of diagnostics and repair information products.

Operational Highlights

The company believes its strategy of pivoting toward faster payback items is taking hold, and its broad and innovative product line, distinctive brand, and committed team are driving momentum. Key products include the TAC two torque and angle click wrench, a new cordless ratchet, and the Triton handheld diagnostic tool. The RS&I group saw organic sales increase 8.9%, driven by double-digit gains with OEM dealerships and high single-digit growth in diagnostic and repair information products.

Valuation and Outlook

With a P/E Ratio of 17.71 and an EV/EBITDA of 11.95, the stock appears reasonably valued. The company's return on equity (ROE) of 18.07% and return on invested capital (ROIC) of 11.0% indicate strong profitability. Analysts estimate next year's revenue growth at 3.8%, and with a dividend yield of 2.49%, the stock offers a relatively attractive income stream. The company's guidance for 2025 capital expenditures and an effective income tax rate of 22-23% provides a clear direction for investors.

Management Insights

Management discussed orders coming out of a recent conference, which were positive, and tried to manage expectations by making packages smaller to reduce cancellations. The company is optimistic about its growth prospects, driven by a strong car park, aging vehicles, and the need for mobility maintenance. The OEM business had a share gain component, offsetting some lumpiness, and the diagnostics business had a strong quarter, with high single-digit growth.

3. NewsRoom

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Will SNA's Operational Agility, RCI Plan & Innovations Fuel Growth?

Dec -04

Source: zacks.com

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Fisher Asset Management LLC Lowers Stake in Snap-On Incorporated $SNA

Dec -04

Source: defenseworld.net

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Star Navigation Signs Strategic Agreement with Aquagreen Energy Systems Inc., Developer of the Hydrotor Technologies Concept

Dec -01

Source: feeds.newsfilecorp.com

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Star Navigation Announces Correction to Press Release of October 3, 2025

Nov -27

Source: feeds.newsfilecorp.com

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Bahl & Gaynor Inc. Buys 35,605 Shares of Snap-On Incorporated $SNA

Nov -22

Source: defenseworld.net

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Market Today: Nvidia whipsaws, WBD draws bids, Lilly tops $1T

Nov -21

Source: gurufocus.com

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First Look: AI selloff, jobs jitters, and big corporate shifts

Nov -21

Source: gurufocus.com

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AE Wealth Management LLC Sells 215 Shares of Snap-On Incorporated $SNA

Nov -17

Source: defenseworld.net

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (1.04%)

6. Segments

Snap-on Tools

Expected Growth: 1.2%

Snap-on Tools' 1.2% growth is driven by increasing demand for professional tools and diagnostics, expansion in emerging markets, and a strong brand reputation. Additionally, the company's focus on innovation, digital solutions, and strategic acquisitions contribute to its growth. Furthermore, the rise of electric and autonomous vehicles is driving demand for Snap-on's advanced diagnostic tools, supporting the segment's growth.

Repair Systems and Information

Expected Growth: 0.8%

Snap-on's Repair Systems and Information segment growth is driven by increasing demand for diagnostic and repair solutions, expansion in emerging markets, and strategic acquisitions. Additionally, the rise of electric and autonomous vehicles is fueling growth in advanced diagnostic tools and software. Furthermore, the company's digital platform and subscription-based services are contributing to recurring revenue streams.

Commercial and Industrial

Expected Growth: 1.5%

The 1.5% growth in Commercial and Industrial segment of Snap-on Incorporated is driven by increasing demand for diagnostic and repair information, rising adoption of electric and autonomous vehicles, and growing need for tool storage and management solutions. Additionally, expansion in emerging markets and strategic acquisitions are contributing to the segment's growth.

Intersegment Eliminations

Expected Growth: 0.0%

Intersegment Eliminations from Snap-on Incorporated shows 0.0% growth, driven by the absence of significant transactions between segments, indicating a lack of intercompany sales or purchases. This suggests a well-structured business model with minimal internal dependencies, allowing for efficient resource allocation and a focus on external market opportunities.

Financial Services

Expected Growth: 1.1%

Snap-on Incorporated's 1.1% growth in Financial Services is driven by increasing demand for vehicle diagnostics and repair information, expansion of its credit offerings, and strategic partnerships with OEMs and dealerships. Additionally, the company's digital platform enhancements and growing presence in emerging markets contribute to its steady growth.

7. Detailed Products

Diagnostic Tools

A range of diagnostic tools and equipment for vehicle repair and maintenance, including scan tools, multimeters, and oscilloscopes.

Tool Storage

A variety of tool storage solutions, including tool chests, cabinets, and carts, designed to organize and protect tools and equipment.

Hand Tools

A comprehensive range of hand tools, including wrenches, pliers, screwdrivers, and hammers, designed for professional technicians and serious DIYers.

Equipment

A range of equipment solutions, including lifts, wheel balancers, and tire changers, designed to support vehicle repair and maintenance.

Information and Software Solutions

A range of information and software solutions, including repair information, estimating, and shop management software, designed to support vehicle repair and maintenance.

Shop and Tech Equipment

A range of shop and tech equipment solutions, including air compressors, generators, and lighting, designed to support vehicle repair and maintenance.

8. Snap-on Incorporated's Porter Forces

Forces Ranking

Threat Of Substitutes

Snap-on Incorporated has a diverse product portfolio, which reduces the threat of substitutes. The company's products are highly specialized and are designed to meet specific needs, making it difficult for substitutes to emerge.

Bargaining Power Of Customers

Snap-on Incorporated has a large customer base, which gives customers some bargaining power. However, the company's strong brand reputation and high-quality products reduce the bargaining power of customers.

Bargaining Power Of Suppliers

Snap-on Incorporated has a diversified supplier base, which reduces the bargaining power of suppliers. The company's large scale of operations also gives it negotiating power over suppliers.

Threat Of New Entrants

The tool and equipment industry has high barriers to entry, including high capital requirements and the need for specialized expertise. This reduces the threat of new entrants.

Intensity Of Rivalry

The tool and equipment industry is highly competitive, with several established players competing for market share. Snap-on Incorporated faces intense competition from companies such as Matco Tools and Mac Tools.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 19.46%
Debt Cost 5.16%
Equity Weight 80.54%
Equity Cost 8.92%
WACC 8.19%
Leverage 24.17%

11. Quality Control: Snap-on Incorporated passed 7 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

Stock-Card
Snap-on

A-Score: 6.8/10

Value: 3.9

Growth: 6.0

Quality: 8.1

Yield: 6.0

Momentum: 7.5

Volatility: 9.0

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Lincoln Electric

A-Score: 5.4/10

Value: 2.4

Growth: 6.4

Quality: 6.3

Yield: 2.0

Momentum: 7.5

Volatility: 7.7

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RBC Bearings

A-Score: 5.3/10

Value: 0.8

Growth: 7.4

Quality: 6.8

Yield: 0.0

Momentum: 8.5

Volatility: 8.3

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Toro

A-Score: 5.1/10

Value: 4.1

Growth: 6.1

Quality: 5.8

Yield: 3.0

Momentum: 3.5

Volatility: 8.0

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Timken

A-Score: 4.9/10

Value: 5.4

Growth: 5.1

Quality: 4.6

Yield: 4.0

Momentum: 3.5

Volatility: 7.0

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Stanley Black & Decker

A-Score: 4.2/10

Value: 4.9

Growth: 3.1

Quality: 3.9

Yield: 7.0

Momentum: 1.0

Volatility: 5.3

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

347.21$

Current Price

347.21$

Potential

-0.00%

Expected Cash-Flows