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US Equities · Finance research note

TRMB — Trimble Inc.

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2. Company Fundamentals

2.1 Competitiveness

Metric Value
Operating Margins 15.87%
Profit Margins 12.38%
Return on Equity 8.25%
Return on Assets 4.65%
Free Float 0.23B
Short Int % Utilisation 3.85%

2.2 Growth

Metric Value
Revenue Growth 11.8%
Free Cash Flow 0.37B
EBITDA 14.97 (Ratio)
Enterprise Value 12.97B
EV/Revenue 3.52
EV/EBITDA 14.97

Revenue growth of 11.8% indicates steady, moderate expansion.

2.3 Management

Role Metric
Consensus Rating N/A

2.4 Return

Metric Value
Expected Return (Ann.)* -26.58%
Risk / Std Dev (Ann.)* 31.57%
1-Year Price Return* -29.96%

Latest Market Data (as of 2026-08-14, US Eastern time):

Metric Value
Last Price $57.60
52-Week Range $47.92 – $84.42
Observation Count 251 trading days

The return and risk statistics use daily adjusted closes from the retrieved one-year series and annualise daily moments using 252 trading days. The last price is the latest regular-market price reported for the stated date. Source: Yahoo Finance market data.

DuPont Model Analysis

The DuPont model decomposes return on equity (ROE) into three operating and capital-structure drivers:

ROE = Net Margin × Asset Turnover × Equity Multiplier

The comparison uses the latest two comparable annual periods available for the issuer, with reported statement amounts shown in US$. Revenue and net income are income-statement flows; total assets and shareholders’ equity are year-end balance-sheet figures. This is a simplified year-end-balance DuPont comparison rather than an average-balance ROE calculation.

DuPont component Calculation FY2025 FY2024
Revenue Reported revenue $3.59B $3.68B
Net income Reported net income $424.00M $1.50B
Total assets Year-end reported balance $9.31B $9.49B
Shareholders’ equity Year-end reported balance $5.84B $5.75B
Net margin Net income ÷ revenue 11.82% 40.84%
Asset turnover Revenue ÷ total assets 0.3852x 0.3882x
Equity multiplier Total assets ÷ shareholders’ equity 1.5956x 1.6515x
ROE Net margin × asset turnover × equity multiplier 7.27% 26.18%

Source: Yahoo Finance annual statements. Values are based on the two latest comparable annual periods returned by the source; fiscal period labels use the statement period-end year.

2.5 FCFF DCF Valuation

Valuation basis: This research model follows a five-year, unlevered FCFF DCF. It starts from reported annual operating inputs, forecasts revenue and operating cash conversion under an explicit mechanical policy, discounts FCFF at WACC, applies a Gordon-growth terminal value, and bridges enterprise value to an indicative common-equity value per share. It is an analytical estimate rather than a recommendation or personalised target price.

Step 1 — Forecast Operating Profit and NOPAT

Reported operating input Value
Revenue $3.59B
Prior annual revenue $3.68B
EBIT $583.80M
Tax rate 16.76%
NOPAT = EBIT × (1 − tax rate) $485.93M
Forecast start-growth basis -2.61%
Forecast policy latest reported annual revenue growth, bounded to -10.00% / 15.00%

Step 2 — Calculate FCFF

Current FCFF building block Value
NOPAT $485.93M
Add: depreciation & amortisation $199.90M
Less: capital expenditure -$25.30M
Less/(add): working-capital cash-flow movement -$472.00M
Current unlevered FCFF $188.53M

Explicit FCFF forecast

Forecast year Revenue growth NOPAT D&A Capex Change in NWC FCFF Present value
1 -2.61% $473.26M $194.69M -$24.64M -$459.70M $183.61M $173.93M
2 -1.33% $466.97M $192.10M -$66.26M -$453.59M $139.22M $118.35M
3 -0.05% $466.72M $192.00M -$108.15M -$453.34M $97.23M $74.16M
4 1.22% $472.43M $194.35M -$151.91M -$458.89M $55.98M $38.32M
5 2.50% $484.24M $199.21M -$199.21M -$470.36M $13.88M $8.52M

Step 3 — Determine the Discount Rate (WACC)

WACC input Value
Risk-free rate 4.71%
Equity risk premium assumption 5.50%
Beta 1.36
Cost of equity 12.17%
Pre-tax cost of debt 5.35%
WACC 11.44%
WACC validation within standard range

Step 4 — Estimate Terminal Value

Terminal-value input Value
Perpetuity growth rate 2.50%
Terminal value $159.12M
Implied terminal EV / EBITDA 0.20x
Terminal value as % of enterprise value 18.30%

Step 5 — Discount Cash Flows to Enterprise Value

Enterprise-value component Value
Present value of explicit FCFF $413.28M
Present value of terminal value $92.58M
Indicated enterprise value $505.86M
Discounting convention mid-year for explicit FCFF; terminal value discounted at year-end five

Step 6 — Convert Enterprise Value to Equity Value

Equity bridge Value
Indicated enterprise value $505.86M
Less: gross interest-bearing debt $1.39B
Add: cash and equivalents $253.40M
Add: affiliate investments $0.00
Less: minority interests $0.00
Indicated common equity value -$632.94M

Step 7 — Calculate Indicative Value Per Share

Per-share output Value
Shares used 241,500,000.00
Share-count basis reported diluted weighted-average shares
Current market price $57.20
DCF indicative value per share -$2.62
Indicative value vs. market price -104.58%

Model Integrity Checks

Check Result
Perpetuity growth is below the risk-free rate pass
Perpetuity growth is below WACC pass
WACC is within the configured operating-company range pass
Terminal-year FCFF is positive pass
Terminal capex converges to D&A pass
Terminal-value concentration review required
Implied price differs from spot by more than 30% review required

2.6 Investor-Style Research Screen

Educational screen Result
Buffett-inspired cash-quality checks 3/4 evidenced checks
Lynch-inspired balance-and-growth checks 4/4 evidenced checks

Data lineage: Yahoo Finance public market and reported-statement data; retrieval timestamp: 2026-08-18 17:51:20.571926 UTC; latest reported fiscal period: 2025-12-31 00:00:00. Default assumptions: five-year forecast, mid-year discounting for explicit FCFF, a maximum 2.50% perpetuity-growth rate below both WACC and the risk-free rate, historical operating-ratio persistence, and capex convergence to D&A by year five. No sell-side consensus or management guidance is substituted for reported inputs. This is research and analysis only, not personalized financial advice.

2.7 Quantitative Factor Diagnostics

Model basis: Daily issuer USD excess returns are regressed in-sample using ordinary least squares on matching regional Fama–French factors. FF3 estimates market, size, and value loadings; FF5 adds profitability and investment. Coefficients are descriptive historical exposures, not predictions.

Estimation input Value
Regional factor set US
Factor-return currency USD
Issuer-return basis USD adjusted total return
Estimation window 2025-08-19 to 2026-06-30
Aligned daily observations 217
Minimum observation requirement 120
Currency conversion for HK listings not required

Fama–French Three-Factor and Five-Factor Results

Diagnostic FF3 FF5
Annualised alpha -52.10% -49.03%
Adjusted R² 0.37 0.38
Annualised residual volatility 24.00% 23.71%
Factor loading (t-statistic) FF3 FF5
Market excess return (Mkt-RF) 1.05 (7.41) 1.19 (7.43)
Size (SMB) 0.87 (4.54) 0.78 (3.82)
Value (HML) -0.29 (-1.76) -0.55 (-2.74)
Profitability (RMW) NM 0.13 (0.76)
Investment (CMA) NM 0.58 (1.95)

Definitions: Mkt-RF is the market return less the risk-free rate; SMB is small minus big; HML is high minus low book-to-market; RMW is robust minus weak profitability; CMA is conservative minus aggressive investment. Factor returns are sourced from the Kenneth R. French Data Library; issuer adjusted-return history is sourced from Yahoo Finance. For Hong Kong listings, adjusted HKD prices are converted into USD with daily USD/HKD closes before return calculation to match the USD regional factor basis. This is an in-sample historical regression; coefficients and t-statistics do not establish causation or predict future returns. This is research and analysis only, not personalized financial advice.

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