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1. Company Snapshot

1.a. Company Description

Titan Machinery Inc.owns and operates a network of full-service agricultural and construction equipment stores in the United States and Europe.It operates through three segments: Agriculture, Construction, and International.


The company sells new and used equipment, including agricultural and construction equipment manufactured under the CNH Industrial family of brands, as well as equipment from various other manufacturers.Its agricultural equipment includes machinery and attachments for use in the production of food, fiber, feed grain, and renewable energy; and home and garden applications, as well as maintenance of commercial, residential, and government properties.The company's construction equipment comprises heavy construction machinery, light industrial machinery for commercial and residential construction, road and highway construction machinery, and energy and forestry operations equipment.


It also sells maintenance and replacement parts.In addition, the company offers repair and maintenance services that include warranty repairs, off-site and on-site repair services, scheduling off-season maintenance services, and notifying customers of periodic service requirements; and training programs to customers.Further, it rents equipment; and provides ancillary equipment support services, such as equipment transportation, global positioning system signal subscriptions and other precision farming products, farm data management products, and CNH Industrial finance and insurance products.


The company operates in Colorado, Iowa, Minnesota, Montana, Nebraska, North Dakota, South Dakota, Wisconsin, and Wyoming, the United States; and Bulgaria, Germany, Romania, and Ukraine, Europe.Titan Machinery Inc.was founded in 1980 and is headquartered in West Fargo, North Dakota.

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1.b. Last Insights on TITN

Titan Machinery Inc.'s recent performance was driven by a significant inventory reduction of approximately $304 million in the fiscal fourth quarter, bringing the total inventory reduction since the fiscal second quarter peak to $419 million. This strategic move is expected to improve the company's operational efficiency and reduce costs. Additionally, the company's efforts to optimize its inventory levels and improve its supply chain management are likely to have a positive impact on its future financial performance.

1.c. Company Highlights

2. Titan Machinery's Q3 Earnings: A Mixed Bag

Titan Machinery Inc. reported its third-quarter fiscal 2026 earnings, with total revenue at $644.5 million, a 4.8% decrease in same-store sales from the prior year. Despite the sales decline, gross profit was $111 million, with a gross profit margin of 17.2%, driven by a 70 basis point improvement in equipment margins. Net income was $1.2 million, with earnings per diluted share of $0.05, beating analyst estimates of -$0.36. The company's adjusted debt to tangible net worth ratio was 1.7 times as of October 31, 2025.

Publication Date: Nov -29

📋 Highlights
  • Revenue Decline and Gross Margin Improvement: Q3 revenue fell 4.8% to $644.5M, but gross profit rose to $111M (17.2% margin), with a 70-bp equipment margin improvement.
  • Europe Segment Surge: Same-store sales jumped 88% due to stimulus-driven demand in Romania, offsetting domestic ag’s 12.3% decline.
  • Inventory Reduction Progress: Inventory down $98M YTD, with a revised $150M full-year reduction target; peak-to-date decline hits $517M.
  • Margin Moderation and Guidance: Equipment margins expected to drop to ~7% in Q4, but full-year loss per share guidance of $1.50–$2 remains due to tax valuation allowances.

Segment Performance

The domestic ag segment saw a same-store sales decrease of 12.3%, but segment pretax income was $6.1 million, reflecting improved equipment margins and lower expenses. The Europe segment had an 88% increase in same-store sales, driven by stimulus-driven strength in Romania. The parts and service segment saw a 4% decline year-over-year, which is considered stable given the 30% decline in large ag new equipment sales.

Inventory Management

The company reduced total inventory by $98 million in the first nine months of the year, with a cumulative reduction of $517 million from peak levels. The inventory reduction target was raised to $150 million for the full fiscal year. The company expects to continue managing down inventory levels to get into a better position heading into next year.

Outlook

The company expects construction revenue to be down 5% to 10% and Europe revenue to be up 35% to 40% for the full fiscal year. The European business, particularly in Romania, saw significant growth this year, but is expected to decline by 30-40% in fiscal 2027 due to subsidy dissipation. The US business is expected to face another potentially down year in fiscal 2027, but the company is working on footprint optimization and expects to drive margin improvement.

Valuation

With a P/E Ratio of -6.82 and a P/S Ratio of 0.17, the market seems to have priced in the challenges faced by the company. The EV/EBITDA ratio of 132.13 suggests that the company's valuation is still stretched. However, the Free Cash Flow Yield of 40.52% indicates that the company is generating significant cash, which could be a positive for investors.

3. NewsRoom

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Titan Machinery: The Agriculture Industry's Struggles Continue

Nov -27

Source: seekingalpha.com

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Why Titan Machinery Stock Thrashed the Market on Tuesday

Nov -25

Source: fool.com

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Titan Machinery Inc. (TITN) Q3 2026 Earnings Call Transcript

Nov -25

Source: seekingalpha.com

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Here's What Key Metrics Tell Us About Titan Machinery (TITN) Q3 Earnings

Nov -25

Source: zacks.com

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Titan Machinery (TITN) Tops Q3 Earnings and Revenue Estimates

Nov -25

Source: zacks.com

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Titan Machinery Inc. Announces Results for Fiscal Third Quarter Ended October 31, 2025

Nov -25

Source: globenewswire.com

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Titan Machinery Inc. to Report Fiscal Third Quarter Ended October 31, 2025 Results on Tuesday, November 25, 2025

Nov -11

Source: globenewswire.com

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Titan Machinery Announces Divestiture of its Dealership Operations in Germany

Nov -10

Source: globenewswire.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (4.50%)

6. Segments

Agriculture

Expected Growth: 4.5%

Titan Machinery Inc.'s 4.5% growth in Agriculture is driven by increasing global food demand, government subsidies for farm mechanization, and rising adoption of precision farming technologies. Additionally, the company's expanding product offerings and strategic partnerships with agricultural suppliers contribute to its growth momentum.

Construction

Expected Growth: 4.8%

Titan Machinery Inc.'s 4.8% growth in Construction is driven by increasing infrastructure spending, government-backed projects, and rising demand for heavy equipment rentals. Additionally, the company's strategic expansion into new markets, improved product offerings, and strong dealer network have contributed to this growth.

Europe

Expected Growth: 4.2%

Titan Machinery Inc.'s 4.2% growth in Europe is driven by increasing agricultural demand, government subsidies for farm mechanization, and a growing construction industry. Additionally, the region's rising population and urbanization have led to higher demand for heavy equipment and machinery, further boosting growth.

Australia

Expected Growth: 4.6%

Titan Machinery Inc.'s 4.6% growth in Australia is driven by increasing agricultural productivity, government investments in rural infrastructure, and a growing demand for precision farming technologies. Additionally, the country's strong economy and favorable trade agreements have boosted exports, leading to higher demand for agricultural equipment and machinery.

7. Detailed Products

Agricultural Equipment

Titan Machinery Inc. offers a wide range of agricultural equipment from leading manufacturers such as Case IH, New Holland, and others.

Construction Equipment

Titan Machinery Inc. provides a variety of construction equipment from brands like Case Construction, New Holland Construction, and others.

Heavy Truck and Trailer Sales

Titan Machinery Inc. offers a selection of heavy trucks and trailers from manufacturers like Peterbilt, International, and others.

Rental Equipment

Titan Machinery Inc. provides a range of rental equipment for agricultural, construction, and industrial applications.

Parts and Service

Titan Machinery Inc. offers genuine parts and service support for the equipment they sell.

8. Titan Machinery Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Titan Machinery Inc. faces moderate threat from substitutes, as customers have limited alternatives for agricultural and construction equipment.

Bargaining Power Of Customers

Titan Machinery Inc. has a diverse customer base, which reduces the bargaining power of individual customers, resulting in low bargaining power.

Bargaining Power Of Suppliers

Titan Machinery Inc. relies on a few large suppliers for its equipment, giving them moderate bargaining power.

Threat Of New Entrants

The agricultural and construction equipment industry has high barriers to entry, making it difficult for new entrants to compete with Titan Machinery Inc.

Intensity Of Rivalry

Titan Machinery Inc. operates in a highly competitive industry, with several established players, leading to high intensity of rivalry.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 60.92%
Debt Cost 3.95%
Equity Weight 39.08%
Equity Cost 10.97%
WACC 6.69%
Leverage 155.90%

11. Quality Control: Titan Machinery Inc. passed 3 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
Global Industrial

A-Score: 5.5/10

Value: 4.0

Growth: 4.9

Quality: 6.9

Yield: 7.0

Momentum: 6.0

Volatility: 4.3

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DXP Enterprises

A-Score: 4.9/10

Value: 3.7

Growth: 7.1

Quality: 4.5

Yield: 0.0

Momentum: 10.0

Volatility: 4.0

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EVI Industries

A-Score: 4.4/10

Value: 4.7

Growth: 7.0

Quality: 6.8

Yield: 1.0

Momentum: 4.5

Volatility: 2.3

1-Year Total Return ->

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Titan Machinery

A-Score: 4.4/10

Value: 7.8

Growth: 4.4

Quality: 2.8

Yield: 0.0

Momentum: 6.5

Volatility: 4.7

1-Year Total Return ->

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Kelly Services

A-Score: 4.3/10

Value: 8.6

Growth: 2.0

Quality: 4.2

Yield: 4.0

Momentum: 1.0

Volatility: 6.0

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Transcat

A-Score: 3.1/10

Value: 2.7

Growth: 6.2

Quality: 5.3

Yield: 0.0

Momentum: 0.0

Volatility: 4.3

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

16.01$

Current Price

16.01$

Potential

-0.00%

Expected Cash-Flows