Equity Research Analysis: TOOTSIE ROLL INDUSTRIES INC (TR)
|Blank Capital Research Unit|Spot: $42.42
Price$42.42
Composite Score59.4/100
RatingHOLD (3★)
Rank#753 OF 7,333
Market Cap$3.1B
P/E Ratio
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Tootsie Roll Industries, Inc. engages in the manufacture and sale of confectionery products in the United States, Canada, Mexico, and internationally. The company sells its products under the T-Roll, T-Pops, Charms, Blow-Pop, and Cella's, Dots, Junior Mints.
Manufacturing
Food Products
$3.05B
2.0K
CHICAGO, Illinois
Ellen R. Gordon
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Solid dividend yield for income-focused strategies.
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X-AXIS: EV/EBITDA (LOWER = CHEAPER) | Y-AXIS: ROE (HIGHER = ELITE) | RED CIRCLE = TR ANALYSIS TARGET
| Stock | Rating | Score▼ | Quality | Value | Momentum | P/E | EV/EBITDA | ROE | ROA | Gross Mgn | Op Mgn | Net Mgn | Rev Growth | Div Yield | D/E | Mkt Cap | AUDIT |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
$UL UNILEVER PLC | 78 | 96 | 98 | 59 | - | - | 28.5% | 8.0% | 100.0% | 100.0% | 10.4% | -4.6% | 3.3% | 0.0x | $141.8B | VS | |
$ASML ASML HOLDING NV | 77 | 89 | 86 | 83 | - | - | 46.1% | 16.6% | 51.3% | 31.9% | 26.8% | -4.0% | 1.0% | 25.0x | $272.1B | VS | |
$ESLT ELBIT SYSTEMS LTD | 76 | 81 | 87 | 85 | - | - | 10.3% | 3.1% | 24.1% | 7.2% | 4.7% | 14.3% | 0.8% | 25.0x | $11.4B | VS | |
$MT ArcelorMittal | 75 | 71 | 98 | 85 | - | - | 2.2% | 1.5% | 9.3% | 5.3% | 2.2% | -8.5% | 2.2% | 16.0x | $18.9B | VS | |
$AMAT APPLIED MATERIALS INC /DE | 75 | 85 | 87 | 84 | 20.9x | 13.6x | 35.5% | 19.8% | 48.7% | 29.2% | 24.7% | 4.4% | 0.8% | 32.0x | $181.9B | VS | |
$SIMO Silicon Motion Technology CORP | 75 | 84 | 86 | 85 | - | - | 11.8% | 8.8% | 45.9% | 11.3% | 11.1% | 25.7% | 3.7% | 0.0x | $1.8B | VS | |
$CODA Coda Octopus Group, Inc. | 74 | 83 | 90 | 79 | 16.3x | 11.9x | 7.6% | 7.0% | 66.5% | 17.1% | 15.6% | 39.0% | 0.0% | 0.0x | $115M | VS | |
$GSK GSK plc | 74 | 84 | 90 | 70 | - | - | 22.6% | 4.9% | 71.2% | 12.8% | 9.4% | 1.7% | 5.9% | 124.0x | $72.1B | VS | |
$EFXT Enerflex Ltd. | 74 | 80 | 91 | 83 | - | - | 3.0% | 1.1% | 20.9% | 7.3% | 1.3% | 3.0% | 0.9% | 67.0x | $1.2B | VS | |
$BUD Anheuser-Busch InBev SA/NV | 74 | 84 | 97 | 63 | - | - | 8.2% | 3.5% | 55.3% | 25.9% | 12.4% | 0.7% | 1.7% | 0.0x | $87.0B | VS | |
$TR TOOTSIE ROLL INDUSTRIES INC | 59 | 64 | 70 | 53 | 29.1x | 29.5x | 11.3% | 8.5% | 35.0% | 13.2% | 13.3% | 54.4% | 3.1% | 34.0x | $3.1B | ||
| SECTOR BENCH | - | - | - | - | - | 22.3x | 11.5x | -2.5% | -0.1% | 42.5% | 1.3% | -0.2% | 5.9% | 0.0% | 0.2x | - | REF |
TOOTSIE ROLL INDUSTRIES INC (TR) receives a "Hold" rating with a composite score of 59.4/100. It ranks #753 out of 7,333 stocks in our coverage universe and carries a 3-star rating. Ratings are driven by a 6-factor quantitative model measuring quality, value, momentum, investment, stability, and short interest.
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Ellen R. Gordon
Chief Executive Officer
Labor Force
2,000
64
30
95
Audit Verdict: Average governance indicators based on financial metrics.
No recent insider transactions available for TR
In-line with peers — no strong momentum signal
Trading at a discount to fundamentals — favorable entry valuation
High profitability & efficiency — strong quality floor supports entry
Low volatility — smoother ride and historically better risk-adjusted returns
Aggressive spending — empire-building risk, dilutive growth
Mid-range overall rating
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Relative valuation derived from Manufacturing sector benchmarks. Model weights: EV/EBITDA (40%), P/B (35%), P/S (25%). Re-calculated daily.
Projection based on user-defined inputs. Re-calculated daily against current market data.
Reverse DCF Framework — Mauboussin Methodology
Institutional-grade Reverse DCF analysis. This model identifies the growth hurdles embedded in current market prices. When implied growth is significantly lower than historical or projected rates, a margin of safety may exist. Re-audited daily.
No analyst ratings for TR.
View All RatingsYOY expansion rate
Core pricing power
Operating efficiency
Bottom-line conversion
Equity capital efficiency
Asset base utilization
Financial leverage load
Direct cash return
Conservative accounting — High cash conversion efficiency
Material decline in asset turnover efficiency detected
Capital Income Projection
A $10,000 capital deployment would generate approximately $309 annually in verified dividends.
ROE proxy 11.3% (sector -2.5%)
GM 35% vs sector 43%, OM 13% vs sector 1%
Capital turnover N/A
Rev growth 54%, 10yr history
Interest coverage N/A, Net debt/EBITDA -2.4x
Composite assessment of profitability, capital efficiency, and financial strength. Top-tier entities demonstrate sustainable cash flow generation and elite competitive moats.
Profit generated per dollar of shareholder equity
Efficiency of asset utilization
Pricing power and cost efficiency
Core business profitability
Bottom-line profitability
The Quality factor evaluates the persistence and magnitude of realized cash flows. Companies with scores >70 exhibit superior pricing power and structural financial resilience through diverse economic regimes.
Our uncertainty rating tracks the predictability of future cash flows and potential for permanent capital loss. Moderate visibility with standard industry cyclicality.
Our model assigns TOOTSIE ROLL INDUSTRIES INC a Hold rating, with a composite score of 59.4/100 and 3 out of 5 stars. Ranked #753 of 7,333 stocks, TR presents a mixed quantitative picture — neither compelling enough to initiate new positions nor weak enough to warrant selling. Investors already holding may consider maintaining their position while monitoring for changes in the factor profile.
With a quality score of 64/100, TR shows adequate but unremarkable business quality. The company reports a return on equity of 11.3% (sector avg: -2.5%), gross margins of 35.0% (sector avg: 42.5%), net margins of 13.3% (sector avg: -0.2%). This suggests the company generates acceptable returns but may lack the competitive positioning or operational efficiency to stand out from peers.
TR carries a solid value score of 70/100, pointing to an attractively priced stock relative to peers. Key valuation metrics include a P/E ratio of 29.12x, an EV/EBITDA of 29.47x, a P/B ratio of 3.30x. This score suggests reasonable compensation for the risks involved, with potential upside if the market recognizes the stock's underlying worth.
TOOTSIE ROLL INDUSTRIES INC's investment score of 30/100 suggests limited reinvestment activity. Key growth metrics include revenue growth of 54.4% vs. a sector average of 5.9% and a return on assets of 8.5% (sector: -0.1%). While this can be positive for mature, cash-generative businesses returning capital to shareholders, it may also signal a lack of growth opportunities or management conservatism.
TR demonstrates moderate momentum with a score of 53/100, suggesting a neutral price trend without strong directional conviction. Revenue growth stands at 54.4% year-over-year, while a beta of 0.10 reflects its sensitivity to broader market moves. Moderate momentum may indicate the stock is consolidating or transitioning between trends, warranting close monitoring of upcoming catalysts.
TOOTSIE ROLL INDUSTRIES INC earns an excellent stability score of 95/100, reflecting low price volatility and a conservatively managed balance sheet. Key stability metrics include a beta of 0.10 and a debt-to-equity ratio of 34.00x (sector avg: 0.2x). Stocks with this level of stability tend to act as portfolio anchors, providing downside protection during market corrections while still participating in broad market advances.
TOOTSIE ROLL INDUSTRIES INC's short interest score of 23/100 reveals significant bearish positioning, suggesting institutional investors are actively betting against the stock. Specific risk factors include elevated leverage (D/E: 34.00x). At $3.1B (mid-cap), TR carries meaningful risk and is best suited for investors with high risk tolerance who have thoroughly evaluated the bear thesis.
TR pays a solid dividend yield of 3.1%, contributing an income component to total returns. This moderate yield suggests a balance between returning capital to shareholders and retaining earnings for reinvestment — a common profile among quality compounders.
TOOTSIE ROLL INDUSTRIES INC is a mid-cap company in the Manufacturing sector, ranked #0 of 50 in its sector (100th percentile) and #753 of 7,333 overall (90th percentile). Key comparisons include ROE of 11.3% exceeding the -2.5% sector median and operating margins of 13.2% above the 1.3% sector average. This top-quartile standing reflects exceptional competitive strength relative to Manufacturing peers.
While TR currently exhibits a HOLD profile, superior opportunities exist within the MANUFACTURING sector. Our model identifies several "Strong Buy" candidates with higher quality scores and more attractive valuations among direct industry competitors.
View Top Manufacturing Alpha →Quant Factor Profile
Key factor gap
Stability (95) vs Short Int. (23) — closing this gap could shift the rating.
EV/EBITDA 157% ABOVE SECTOR MEDIAN
ROE 557% BELOW SECTOR MEDIAN
Gross Margin 18% BELOW SECTOR MEDIAN
AUDIT DATA AS OF SEP 30, 2025 (Q2 FY2025)
We rate TOOTSIE ROLL INDUSTRIES INC (TR) as a Hold with a composite score of 59.4/100 at a current price of $42.42. The stock presents a mixed quantitative picture — neither compelling enough to warrant new accumulation nor weak enough to justify selling for existing holders. Our factors are split, and the overall profile suggests patience is warranted.
The rating is primarily driven by strength in stability (95th percentile) and value (70th percentile), which together account for the majority of the composite score. Offsetting weakness in investment (30th percentile) and momentum (53th percentile) tempers our overall conviction. We assign a Narrow Moat rating (46/100), Low uncertainty, and Standard capital allocation.
Key items to watch: sustainability of the current growth rate. Any material change in these dynamics could warrant a reassessment of our rating. The moat trend is stable, which suggests the competitive landscape is stable for now.
TOOTSIE ROLL INDUSTRIES INC holds a top-quartile position (#0 of 50) within the Manufacturing sector, based on our composite quantitative scoring across quality, value, momentum, and stability factors. The composite score of 59.4/100 places it at rank #753 in our full 7,333-stock universe. At $3.1B in market capitalization, TOOTSIE ROLL INDUSTRIES INC is a mid-cap player in the Manufacturing space, which limits certain scale advantages but may allow for more agile strategic execution.
Revenue is growing at 54%, though momentum at the 53th percentile suggests the market has not yet fully recognized this trajectory. This potential disconnect between fundamental improvement and market recognition could represent an opportunity for patient investors if the growth trend persists.
The margin cascade tells an important story: gross margins of 35% (-7.5pp vs sector) narrow to operating margins of 13% (+11.9pp vs sector) and net margins of 13.3%, yielding a gross-to-net conversion rate of 38%. This efficient conversion suggests well-controlled operating costs and limited margin leakage between the gross and net levels.
At a current price of $42.42, TOOTSIE ROLL INDUSTRIES INC is trading near fair value based on current fundamentals. Our value factor score of 70/100 reflects a composite assessment across multiple valuation metrics including price-to-earnings, price-to-book, EV/EBITDA, and price-to-sales ratios relative to both sector peers and the broader market. Valuation metrics are mixed, with no strong signal of mispricing in either direction.
The stock currently trades at a P/E of 29.1x (a 31% premium to the sector median of 22.3x), EV/EBITDA of 29.5x (at a premium), P/B of 3.3x, P/S of 4.0x. The above-sector P/E multiple suggests the market is pricing in superior growth or quality, which our analysis partially supports given strong quality metrics.
Revenue growth of 54% confirms the business is expanding its addressable market — growth at this level typically supports multiple expansion and attracts institutional capital.
A value factor score of 70/100 suggests the market is underpricing these fundamentals, creating a potential margin of safety for new investors.
A 3.09% dividend yield provides income while you wait, and dividends historically account for a significant portion of total equity returns.
Return on assets of 8.5% indicates efficient deployment of the full asset base, not just equity capital.
Even high-quality stocks face risks from valuation compression, competitive disruption, or macro shocks that are difficult to quantify in advance.
We assign a Low uncertainty rating to TOOTSIE ROLL INDUSTRIES INC. The company exhibits strong financial stability with a beta of 0.10, conservative leverage (34% D/E), and a stability factor in the 95th percentile. The predictable nature of the business model and solid financial position reduce the range of potential outcomes, giving us confidence in our fair value estimate.
Specific risk factors that inform our assessment include: low beta of 0.10 — while defensive, this may indicate limited upside participation in bull markets. Each of these factors independently widens the distribution of potential outcomes, and in combination they create a risk profile that demands careful position sizing. The stability factor at the 95th percentile and quality factor at the 64th percentile provide a quantitative summary of the overall risk landscape.
Key risk mitigants include: above-average stability (95th percentile) suggests predictable business dynamics; a 3.09% dividend yield anchors total return. These factors partially offset the identified risks and provide downside protection in adverse scenarios. On balance, the risk-reward profile is favorable for long-term investors.
We rate TOOTSIE ROLL INDUSTRIES INC's capital allocation as Standard. Management has shown adequate — though not exceptional — stewardship of shareholder capital. Returns on equity stand at 11.3%, and the balance sheet is managed within acceptable parameters (D/E: 34%). Exemplary allocators typically sustain ROE above 20% and D/E below 50%; TOOTSIE ROLL INDUSTRIES INC falls short on at least one dimension.
There is room for improvement in optimizing the capital structure or enhancing shareholder returns. The 3.09% dividend yield provides some income return, but the overall capital allocation framework would benefit from either higher reinvestment returns, improved balance sheet efficiency, or increased shareholder distributions. We will monitor for signs of strategic improvement that could warrant an upgrade.
In summary, TOOTSIE ROLL INDUSTRIES INC receives a Hold rating with a composite score of 59.4/100 (rank #753 of 7,333). Our quantitative framework assigns a Narrow Moat (46/100, trend: stable), Low uncertainty, and Standard capital allocation. The average factor score across quality, value, momentum, stability, and investment is 62/100.
Our analysis supports a neutral stance on TOOTSIE ROLL INDUSTRIES INC. While the quantitative profile is not weak enough to warrant selling, it lacks the multi-factor strength required for a buy recommendation. Existing holders should maintain positions and monitor for catalysts — either fundamental improvement or valuation compression — that would shift the risk-reward balance.
Analysis derived from Blank Capital Research quantitative terminal. For informational purposes only. No trade solicitation. Past performance not indicative of future results. Consult a qualified advisor.
We assign TOOTSIE ROLL INDUSTRIES INC a Narrow Moat rating with a composite moat score of 46/100. The company possesses identifiable competitive advantages, though they are less entrenched than those of wide-moat peers. Our analysis indicates that TOOTSIE ROLL INDUSTRIES INC can sustain above-average returns on invested capital for at least 10 years, with the strongest contributor being margin superiority at 13.5/20.
The strongest moat sources are margin superiority (13.5/20) and financial resilience (12/20). GM 35% vs sector 43%, OM 13% vs sector 1%. Interest coverage N/A, Net debt/EBITDA -2.4x. These pillars form the core of TOOTSIE ROLL INDUSTRIES INC's competitive identity and are the primary drivers of excess returns in our framework.
Areas of relative weakness include reinvestment efficiency (0/20) and economic value creation (9.7/20). Capital turnover N/A. Improvement in these areas could meaningfully widen the moat over time, while deterioration would be an early warning of competitive erosion.
Our moat trend assessment is Stable. Multi-year ROIC and operating margin trajectories show neither meaningful improvement nor deterioration, suggesting the competitive position is steady. We expect TOOTSIE ROLL INDUSTRIES INC's moat profile to remain largely unchanged absent a material shift in return on capital or industry dynamics.
Key profit drivers include operating margins of 13% reflecting effective cost management, robust top-line growth of 54% expanding the revenue base. The margin cascade from 35% gross to 13% operating to 13.3% net reveals the company's cost structure and reinvestment intensity. Our analysis indicates that the profit engine is high-quality and likely sustainable, with the quality factor at the 64th percentile.
The margin profile shows gross margins of 35%, operating margins of 13%, net margins of 13.3%. Return metrics include ROE of 11.3% and ROA of 8.5%. Relative to the Manufacturing sector, gross margins are 7.5 percentage points below the sector median of 43%, and ROE of 11.3% compares to a sector median of -2.5%.
The balance sheet reflects moderate leverage with D/E of 34%, a dividend yield of 3.09%, revenue growth of 54%. The sector median D/E is 0%, putting TOOTSIE ROLL INDUSTRIES INC at higher leverage than the typical peer. The combination of low leverage and healthy profitability provides significant financial resilience and strategic optionality.
Above 50MA
37.18%
Net New Highs
+51081
About TOOTSIE ROLL INDUSTRIES INC Tootsie Roll Industries, Inc., together with its subsidiaries, engages in manufacture and sale of confectionery products in the United States, Canada, Mexico, and internationally. It sells its products under the Tootsie Roll, Tootsie Pops, Child's Play, Caramel Apple Pops, Charms, Blow-Pop, Charms Mini Pops, Cella's, Dots, Junior Mints, Charleston Chew, Sugar Daddy, Sugar Babies, Andes, Fluffy Stuff, Dubble Bubble, Razzles, Cry Baby, NIK-L-NIP, and Tutsi Pop tr
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Tootsie Roll Industries experienced higher ingredient costs in 2023, and expects more of the same for 2024.