Value
8.4/10data confidence 83%| Component | Sub-score |
|---|---|
| P/S | 10.0 |
| EV/EBITDA | 3.1 |
| Fwd P/E | 9.8 |
| PEG | 10.0 |
| Analyst target | 9.0 |
- ▸Forward P/E: 6.2x
- ▸PEG: 0.05
- ▸Attractively valued
CMCO · Why this verdict
Why Columbus McKinnon (CMCO) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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VerdictSELL
Overall score6.1/10
ConfidenceMEDIUM
MacroNEUTRAL
TrendMatrix Research · core thesis
Engine thesis — one sentence
Columbus McKinnon shows exceptionally strong revenue growth, an industry-leading growth rank, and an attractively valued multiple, and the current pullback is explicitly framed as a buy opportunity within a longer uptrend. Business quality sits below the platform's minimum threshold, however, with thin margins and cash burn, and the overall momentum score has separately failed to clear the platform's threshold, a direct tension with the buy-opportunity framing.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
Business quality reads well below the platform's minimum threshold, with the company flagged as cash-burning, carrying no competitive moat, and posting thin gross and operating margins. Quality breakdown | Quality metrics, particularly margins and free cash flow, should recover toward the platform's minimum threshold rather than deteriorate further. | →Stable |
| CounterThe current sub-floor quality reading has already triggered an explicit exit recommendation in the underlying assessment, and cash-burning industrial manufacturers can struggle to self-fund a turnaround without a demand recovery. | ||
The technical read frames the current pullback as a buy opportunity within a broader uptrend, with the stock still above its 200-day moving average, even though the overall momentum score has failed to clear the platform's minimum threshold. Momentum breakdown | The pullback should resolve as described, with the stock holding above its 200-day moving average and RSI recovering out of oversold territory. | ↑Improving |
| CounterThe momentum gate failure and the explicit negative-price-momentum risk flag directly contradict the buy-opportunity framing, and a pullback that continues rather than reverses would confirm the more bearish read instead. | ||
Revenue growth is exceptionally strong, reported at roughly 125% year-over-year, and the company ranks as an industry growth leader relative to peers. Growth breakdown | The elevated growth pace should continue or moderate only gradually over the following quarters. | →Stable |
| CounterGrowth this outsized is difficult to sustain, and it has not yet translated into improved margins or quality, which remain below the platform's minimum threshold. | ||
The stock screens as attractively valued on an earnings basis, with a forward P/E near 6.7x and a PEG ratio of 0.05, alongside meaningful upside to the analyst price target. Valuation breakdown | The valuation gap should narrow as the market re-rates the multiple, particularly if quality metrics recover. | →Stable |
| CounterThe cheap multiple may simply reflect the market pricing in the sub-floor quality and cash-burn concerns already flagged elsewhere in the assessment, rather than overlooked value. | ||
Earnings results have been strong overall, with beats in three of the last four quarters, including a very large beat in the most recent quarter, despite one sizable miss in between. Last 4 quarters | The beat pace should continue, with EPS surprises staying positive across the next reporting quarters. | →Stable |
| CounterThe wide swings between a large beat, a large miss, and further beats suggest highly volatile or unreliable estimates, which tempers confidence that the recent large beat marks a stable new baseline. | ||
Business quality reads well below the platform's minimum threshold, with the company flagged as cash-burning, carrying no competitive moat, and posting thin gross and operating margins.
→StableQuality breakdown
- Expectation
- Quality metrics, particularly margins and free cash flow, should recover toward the platform's minimum threshold rather than deteriorate further.
CounterThe current sub-floor quality reading has already triggered an explicit exit recommendation in the underlying assessment, and cash-burning industrial manufacturers can struggle to self-fund a turnaround without a demand recovery.
The technical read frames the current pullback as a buy opportunity within a broader uptrend, with the stock still above its 200-day moving average, even though the overall momentum score has failed to clear the platform's minimum threshold.
↑ImprovingMomentum breakdown
- Expectation
- The pullback should resolve as described, with the stock holding above its 200-day moving average and RSI recovering out of oversold territory.
CounterThe momentum gate failure and the explicit negative-price-momentum risk flag directly contradict the buy-opportunity framing, and a pullback that continues rather than reverses would confirm the more bearish read instead.
Revenue growth is exceptionally strong, reported at roughly 125% year-over-year, and the company ranks as an industry growth leader relative to peers.
→StableGrowth breakdown
- Expectation
- The elevated growth pace should continue or moderate only gradually over the following quarters.
CounterGrowth this outsized is difficult to sustain, and it has not yet translated into improved margins or quality, which remain below the platform's minimum threshold.
The stock screens as attractively valued on an earnings basis, with a forward P/E near 6.7x and a PEG ratio of 0.05, alongside meaningful upside to the analyst price target.
→StableValuation breakdown
- Expectation
- The valuation gap should narrow as the market re-rates the multiple, particularly if quality metrics recover.
CounterThe cheap multiple may simply reflect the market pricing in the sub-floor quality and cash-burn concerns already flagged elsewhere in the assessment, rather than overlooked value.
Earnings results have been strong overall, with beats in three of the last four quarters, including a very large beat in the most recent quarter, despite one sizable miss in between.
→StableLast 4 quarters
- Expectation
- The beat pace should continue, with EPS surprises staying positive across the next reporting quarters.
CounterThe wide swings between a large beat, a large miss, and further beats suggest highly volatile or unreliable estimates, which tempers confidence that the recent large beat marks a stable new baseline.
Per-dimension breakdown
Quality
3.1/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 0.0 |
| ROA | 1.7 |
| Gross margin | 3.0 |
| Op margin | 4.2 |
| Net margin | 0.0 |
| Current ratio | 7.0 |
| FCF quality | 0.0 |
| Moat | 5.0 |
| Piotroski F | 6.7 |
- ▸Cash-burning: FCF -17% of revenue
- ▸No competitive moat
Growth
10.0/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 10.0 |
| EPS growth | 10.0 |
- ▸Strong growth: 125% YoY
Momentum
2.1/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 3.5 |
| MACD | 3.5 |
| OBV | 1.0 |
| MA position | 2.2 |
| Volume | 0.3 |
- ▸Volume distribution (falling OBV)
- ▸Below 200-MA but MA still rising (+1.2%/30d) — pullback in uptrend, not confirmed weakness
Sentiment
7.1/10data confidence 100%| Component | Sub-score |
|---|---|
| Analyst rating | 6.3 |
| Price target | 9.8 |
| erm sentiment | 5.0 |
- ▸Light analyst coverage (4.0) — signal dampened
- ▸Analyst upside: 63%
Insider
6.5/10data confidence 75%| Component | Sub-score |
|---|---|
| materiality | 6.5 |
| insider conviction | 8.0 |
| holder change | 5.0 |
- ▸Modest insider buying — $194,660 (0.041% of mkt cap)
Peer rank
5.0/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 8.3 |
| quality rank | 0.0 |
| growth rank | 9.4 |
- ▸Industry growth leader
Technical
6.3/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 7.2 |
| support resistance | 8.5 |
| 52w position | 3.2 |
Risk (lower is worse)
3.3/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 0.2 |
| days to cover | 4.4 |
| volatility | 0.0 |
| put call | 10.0 |
| implied vol | 0.0 |
| max pain risk | 3.0 |
| beta | 5.6 |
| debt equity | 3.4 |
- ▸High short interest justified: 33%
- ▸High IV: 95%
- ▸Above max pain $12
Catalyst
6.2/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 6.7 |
| earnings timing | 5.0 |
| surprise avg | 10.0 |
| dividend safety | 4.3 |
- ▸Strong earnings: 3B/1M
- ▸Yield trap warning: high yield but unsafe
How the verdict was assembled
Engine trigger
Quality below minimum threshold.
Engine technical detail
verdict_path:
L1:HARD_BLOCK:QUALITY_FLOORPassed (7)
- ASYMMETRY:3.7>=1.5
- INSIDER:OK
- 8K:CLEAN
- NEWS_EVENTS:NONE_RECENT
- EARNINGS_PROXIMITY:29d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (1)
- MOMENTUM:2.1<4.5
Warning (0)
none
Reward-to-Risk
3.68
Upside
+38.7%
Downside
10.5%
Sizing output
AVOID
Setup— — No clear chart pattern; technical signals are mixed
EdgeCatalyst-Driven — Earnings in 29d with 3/4 beat streak
SuitabilityAggressive — Beta 1.36>1.3, MCap $0.5B<$5B
Investment implication
The SELL_IF_HOLDING verdict reflects the MOMENTUM gate's 2.1<4.5 outcome against Growth at 10.0 and asymmetric R:R of 3.68.
The strongest dimensions are Growth at 10.0, Value at 8.4, and Sentiment at 7.1; the weakest are Momentum at 2.1, Quality at 3.1, and Risk (lower is worse) at 3.3. The V9 engine flagged 1 failed gate, producing an asymmetric reward-to-risk of 3.68 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Sub Floor Quality Cash Burn
Trip ifOperating margin component rises above 6.0 on its 0-10 scale, up from the current 4.2 reading, alongside free cash flow improving to -5% of revenue or better.
- P2Pullback Buy Opportunity Vs Failed Momentum
Trip ifThe stock falls below its 200-day moving average and stays below it for 2 consecutive weeks, confirming the pullback as a breakdown rather than a buy opportunity.
- P3Explosive Growth Industry Leader
Trip ifRevenue growth falls below 20% year-over-year, down sharply from the current ~125% pace.
- P4Attractive Earnings Multiple
Trip ifForward P/E rises above 15x, more than double the current 6.7x level, without a corresponding increase in earnings.
- P5Earnings Beat Pace With Volatility
Trip ifEPS surprise falls below -20% (another large miss) in the next reported quarter.