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Steelcase Inc.’s Performance in a Competitive Market

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Steelcase Inc. and its peers

An analysis of Steelcase’s income statement in 2Q16 follows:

  • The gross profit margins of Steelcase Inc. (SCS), HNI Corp. (HNI), Knoll Inc. (KNL), Herman Miller Inc. (MLHR), and Leggett & Platt Inc. (LEG) are 32.5%, 36.28%, 37.67%, 38.34%, and 23.13%, respectively.
  • The EPS (earnings per share) of Steelcase Inc. (SCS), HNI Corp. (HNI), Knoll Inc. (KNL), Herman Miller Inc. (MLHR), and Leggett & Platt Inc. (LEG) are $0.30, $0.52, $0.36, $0.56, and $0.53, respectively.

An analysis of Steelcase’s balance sheet in 2Q16 follows:

  • The current ratios of Steelcase Inc. (SCS), HNI Corp. (HNI), Knoll Inc. (KNL), Herman Miller Inc. (MLHR), and Leggett & Platt Inc. (LEG) are 1.56, 0.73, 1.63, 1.32, and 1.49, respectively.

An analysis of Steelcase’s valuation follows:

  • The PE (price-to-earnings) ratios of Steelcase Inc. (SCS), HNI Corp. (HNI), Knoll Inc. (KNL), Herman Miller Inc. (MLHR), and Leggett & Platt Inc. (LEG) are 27.31x, 27.43x, 18.14x, 16.13, and 24.70x, respectively.
  • The PB (price-to-book value) ratios of Steelcase Inc. (SCS), HNI Corp. (HNI), Knoll Inc. (KNL), Herman Miller Inc. (MLHR), and Leggett & Platt Inc. (LEG) are 3.36x, 4.51, 4.89x, 3.76x, and 5.46x, respectively.

According to the above findings, based on gross profit margin, EPS, PE, and PB, exchange-traded funds have outperformed Steelcase. However, Steelcase is well ahead of its competitors based on the current ratio.

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ETFs that invest in Steelcase

The WisdomTree US SmallCap Quality Dividend Growth ETF (DGRS) invests 0.76% of its holdings in Steelcase. DGRS tracks a dividend-weighted index of US small-cap stocks with growth characteristics.

The Guggenheim Raymond James SB-1 Equity ETF (RYJ) invests 0.69% of its holdings in Steelcase. RYJ tracks an equal-weighted index of US-listed stocks expected by analysts to achieve 15% total return and outperform S&P 500 over the next six to 12 months.

The PowerShares Russell 2000 Pure Value ETF (PXSV) invests 0.37% of its holdings in Steelcase. PXSV tracks an index of US value stocks, ranked by size from 1,001–3,000 by market cap. Stocks are selected and weighted by price to book, historical sales growth and growth forecast.

The iShares Morningstar Small Core ETF (JKJ) invests 0.34% of its holdings in Steelcase. JKJ tracks a market cap–weighted index of US small cap core stocks. The index selects stocks from 90–97% of market cap that fall into Morningstar’s core style categorization.

Comparing Steelcase and its ETFs

An analysis of Steelcase’s price movement follows:

  • The year-to-date price movements of Steelcase Inc. (SCS), DGRS, RYJ, JKJ, and PXSV are 3.18%, -7.75%, -5.09%, -0.46%, and -9.59%, respectively.

An analysis of Steelcase’s valuation follows:

  • The PE (price-to-earnings) ratios of Steelcase Inc. (SCS), DGRS, JKJ and RYJ are 27.31x, 20.89x, 30.96x and 34.70x respectively.
  • The PB (price-to-book value) ratios of Steelcase Inc. (SCS), DGRS, RYJ, JKJ, and PXSV, are 3.36x, 2.17x, 2.22x, 2.34x, and 1.00x, respectively.

According to the above findings, Steelcase Inc. has outperformed its ETFs based on price movement and price-to-book value.

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