TSR Decomposition | Industrial Machinery & Components
Decomposing the total shareholder return ( TSR ) for industrial machinery & components into value drivers reveals that operating performance and change in subindustry multiple are key drivers .
APPROXIMATED TOTAL SHAREHOLDER RETURN ( TSR ) DECOMPOSITION — INDUSTRIAL MACHINERY & COMPONENTS , 2016 – 2021
10 %
100 %
Two-thirds of the realized TSR were created through operational performance . Revenue and margin were equally important .
30 %
6 %
61 % -1 %
26 %
29 %
Multiple had a strong impact on TSR during the observation period . High valuations were driven by :
• Pandemic-related stimuli
• Fiscal conditions ( e . g ., interest rates )
• Positive investment sentiment
Revenue growth |
Margin improvement |
Investment ( CAPEX ) |
TSR from operational performance |
Leverage |
Multiple change |
Other |
Realized TSR |
Source : Capital IQ , goetzpartners analysis
9