TCL share price in focus
Founded in 1999, Transurban specializes in managing and developing urban toll road networks across Australia, Canada, and the United States.
The company holds interests in 22 urban motorways within its portfolio, including prominent routes such as CityLink in Melbourne, the Hills M2 in Sydney, and the Logan Motorway in Brisbane.
Transurban invests heavily in the development of new infrastructure projects, funding them through toll revenue collected from motor vehicles.
JHX shares
James Hardie Industries is a leading building solutions company and the world’s largest producer of fiber cement and gypsum products.
With operations spanning North America, Europe, Australia, and New Zealand, the company employs over 5,200 people.
Fiber cement is a popular choice for building materials due to its non-combustible nature, resistance to water and termite damage, durability, and low maintenance requirements.
TCL share price valuation
We would consider TCL to be a ‘mature’ or ‘blue-chip’ business, so some of the metrics that could be worth considering include the debt/equity ratio, average yield, and return on equity, or ROE. These measures give us a sense of the company’s debt levels, their ability to generate returns from their assets, and their ability to consistently return profits to shareholders.
For FY24, Transurban Group reported a debt/equity ratio of 175.1%, meaning the company is leveraged (it has more debt than equity). This can increase risk so it’s important that a leveraged company is generating stable returns and has sufficient cash flow to pay interest on its debts.
Over the last 5 years, TCL has delivered an average dividend yield of 3.6% per year. This is important to note if you’re looking for income from your investments.
Finally, in FY24, TCL reported an ROE of 3.0%. For a mature business you generally want to see an ROE of more than 10%, so TCL’s returns are a bit less than what we’d expect.
As a growth company, some of the trends we might consider from JHX shares include revenue growth, profit growth, and return on equity (ROE). I say ‘trends’ because it’s always important to look at these figures over a few years. The trend is much more valuable info than a single measure at one point in time.
Over the last 3 years, JHX has increased revenue at a rate of 10.6% per year to hit $3,936m in FY24. Meanwhile, net profit has increased from $263m to $510m. JHX’s last reported ROE was 29.4%.
Please keep in mind that context is important – these metrics give us some indication of company performance, but it’s just the start of valuing TCL or JHX shares. To learn more about valuation, check out one of our free online investing courses.
