Value
8.4/10data confidence 83%| Component | Sub-score |
|---|---|
| P/S | 10.0 |
| EV/EBITDA | 3.0 |
| Fwd P/E | 9.8 |
| PEG | 10.0 |
| Analyst target | 9.0 |
- ▸Forward P/E: 6.7x
- ▸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 score6.3/10
ConfidenceMEDIUM
MacroNEUTRAL
TrendMatrix Research · core thesis
Engine thesis — one sentence
Columbus McKinnon screens as an industry growth leader trading at a modest gap to its analyst target, but cash-burning free cash flow, elevated short interest, and a flagged dividend yield trap keep overall business quality below the engine's minimum bar.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
Columbus McKinnon's quality score of 3.1 sits below the 4.0 floor, driven by cash-burning free cash flow at -17% of revenue despite the business having no clear competitive moat. Quality breakdown | Free cash flow margin should turn positive and the quality score should rise back above 4.0 within 12 months. | →Stable |
| CounterTemporary FCF burn during a restructuring or integration period (e.g. post-acquisition) can reverse quickly without indicating structural quality problems. | ||
Short interest of 31% and a put/call ratio of 1.44 signal the market sees meaningful downside risk in the stock. Key risks | Short interest should decline below 20% over the next 12 months if the bearish thesis doesn't materialize. | ↑Improving |
| CounterHigh short interest against improving fundamentals can set up a short-covering rally rather than confirm a bearish case. | ||
Columbus McKinnon is ranked as an industry growth leader, with revenue growth scored 125% YoY in the engine's growth dimension. Peer-rank breakdown | Revenue growth should stay elevated relative to industry peers over the next 12 months, sustaining the growth leadership ranking. | →Stable |
| CounterA single-period growth spike, potentially from an acquisition or an easy prior-year comparison, may not be sustainable at the same pace. | ||
The engine flags a yield-trap warning: the dividend yield looks attractive on the surface but is assessed as unsafe given the underlying cash flow profile. Catalyst breakdown | Dividend safety metrics should improve, or the company should avoid a dividend cut, over the next 12 months. | →Stable |
| CounterA company can sustain a seemingly risky payout for a while if it has access to credit facilities or asset sales, delaying any cut well beyond a 12-month window. | ||
The stock trades 17.3% below the analyst price target, a modest gap that limits near-term reward relative to the risk in a quality-constrained name. Estimated upside | The stock should close most of the 17.3% gap toward the analyst target over the next 12 months if fundamentals stabilize. | →Stable |
| CounterA narrow gap to target leaves little margin of safety if estimates are revised down, especially given the quality and cash-burn concerns. | ||
Columbus McKinnon's quality score of 3.1 sits below the 4.0 floor, driven by cash-burning free cash flow at -17% of revenue despite the business having no clear competitive moat.
→StableQuality breakdown
- Expectation
- Free cash flow margin should turn positive and the quality score should rise back above 4.0 within 12 months.
CounterTemporary FCF burn during a restructuring or integration period (e.g. post-acquisition) can reverse quickly without indicating structural quality problems.
Short interest of 31% and a put/call ratio of 1.44 signal the market sees meaningful downside risk in the stock.
↑ImprovingKey risks
- Expectation
- Short interest should decline below 20% over the next 12 months if the bearish thesis doesn't materialize.
CounterHigh short interest against improving fundamentals can set up a short-covering rally rather than confirm a bearish case.
Columbus McKinnon is ranked as an industry growth leader, with revenue growth scored 125% YoY in the engine's growth dimension.
→StablePeer-rank breakdown
- Expectation
- Revenue growth should stay elevated relative to industry peers over the next 12 months, sustaining the growth leadership ranking.
CounterA single-period growth spike, potentially from an acquisition or an easy prior-year comparison, may not be sustainable at the same pace.
The engine flags a yield-trap warning: the dividend yield looks attractive on the surface but is assessed as unsafe given the underlying cash flow profile.
→StableCatalyst breakdown
- Expectation
- Dividend safety metrics should improve, or the company should avoid a dividend cut, over the next 12 months.
CounterA company can sustain a seemingly risky payout for a while if it has access to credit facilities or asset sales, delaying any cut well beyond a 12-month window.
The stock trades 17.3% below the analyst price target, a modest gap that limits near-term reward relative to the risk in a quality-constrained name.
→StableEstimated upside
- Expectation
- The stock should close most of the 17.3% gap toward the analyst target over the next 12 months if fundamentals stabilize.
CounterA narrow gap to target leaves little margin of safety if estimates are revised down, especially given the quality and cash-burn concerns.
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
5.5/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 5.5 |
| MACD | 2.1 |
| OBV | 10.0 |
| MA position | 6.0 |
| Volume | 3.7 |
- ▸Volume accumulation (rising OBV)
- ▸Above 200-day MA
Sentiment
6.5/10data confidence 100%| Component | Sub-score |
|---|---|
| Analyst rating | 5.0 |
| Price target | 9.5 |
| erm sentiment | 5.0 |
- ▸Analyst upside: 48%
Insider
5.8/10data confidence 50%| Component | Sub-score |
|---|---|
| materiality | 6.5 |
| holder change | 5.0 |
- ▸Modest insider buying — $147,525 (0.029% of mkt cap)
Peer rank
4.9/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 7.8 |
| quality rank | 0.0 |
| growth rank | 9.4 |
- ▸Industry growth leader
Technical
6.5/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 7.0 |
| support resistance | 7.8 |
| 52w position | 4.6 |
Risk (lower is worse)
4.6/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 0.4 |
| days to cover | 8.0 |
| volatility | 2.3 |
| put call | 10.0 |
| implied vol | 0.0 |
| max pain risk | 7.0 |
| beta | 5.6 |
| debt equity | 3.4 |
- ▸High short interest justified: 31%
- ▸High IV: 114%
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 (8)
- MOMENTUM:5.5>=4.5
- ASYMMETRY:3.1>=1.5
- INSIDER:OK
- 8K:CLEAN
- NEWS_EVENTS:NONE_RECENT
- EARNINGS_PROXIMITY:48d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (0)
none
Warning (1)
- MOMENTUM:5.5<5.5 (soft — BUY_NOW allowed but watch)
Reward-to-Risk
3.12
Upside
+25.4%
Downside
8.2%
Sizing output
AVOID
Setup— — No clear chart pattern; technical signals are mixed
EdgeInst Constrain — Small cap ($0.5B) below institutional reach
SuitabilityAggressive — Beta 1.36>1.3, MCap $0.5B<$5B
Investment implication
The SELL_IF_HOLDING verdict reflects clean gate clearance against Growth at 10.0 and asymmetric R:R of 3.12.
The strongest dimensions are Growth at 10.0, Value at 8.4, and Sentiment at 6.5; the weakest are Quality at 3.1, Risk (lower is worse) at 4.6, and Peer rank at 4.9. The V9 engine cleared all gates with 1 warning, producing an asymmetric reward-to-risk of 3.12 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Quality Below Floor Cash Burn
Trip ifFree cash flow margin rises above 0% of revenue for 2 consecutive quarters.
- P2Elevated Short Interest And Put Call Skew
Trip ifShort interest falls below 15% from the current 31%.
- P3Industry Leading Growth
Trip ifRevenue growth falls below 10% YoY for 2 consecutive quarters.
- P4Dividend Yield Trap Risk
Trip ifThe company cuts its dividend by more than 25%.
- P5Narrow Gap To Analyst Target
Trip ifThe gap to the analyst target compresses below 5%, from the current 17.3%.