TECNOGLASS INC. (TGLS): what the price assumes

In the published model solve dated 2026-Q2, anchored at $47.78, TECNOGLASS INC. (TGLS) is priced for +8.8% growth. boothcheck publishes no house fair value, target price, or buy/sell rating; individual model outputs and user-controlled scenarios are analytical inputs, not Boothcheck targets. Narrative composed 2026-07-11.

Generated: 2026-08-10 · Exported: 2026-08-12 · Source: https://boothcheck.com/report/TGLS

Headline

What The Price Assumes (Inversion)

The assumption today's price embeds, recovered by inverting the valuation.

Solve inputs: computed at a 11.6% cost of capital with 4% terminal growth over a 5-year stage; each 1pp of cost of capital moves the implied operating-profit growth ~5.2pp.

Reconcile: at the x-ray's 9.3% required return this reads ~-3.1%/yr; the models below use their own rates.

How unusual the bet is: within-range

Valuation X-Ray

The price is justified by relative-multiple and growth-DCF.

How the valuation models price the stock relative to the market price. Price/FV above 1.0 means the market pays more than that lens defends (expensive); at or below 1.0 the lens can defend the price.

Families that justify the price: Relative, Growth

The models below discount at their own flat-beta convention rates (cost of equity 9.3%, WACC 8.5%); the inversion above states its own rate.

Per-Model Detail (n=13)

Solvency

Interest expense is not separately reported in the latest filings, so interest coverage cannot be computed.

Bullet Takeaways

• Tecnoglass makes architectural glass and windows in Colombia and sells them mostly into the U.S. Southeast, a footprint its 10-K credits with "structural cost advantages in manufacturing and distribution due to our geographic location", and the model currently produces a 20.3 percent return on equity with a record $1.36 billion backlog, up 19.1 percent year over year.
• The biggest near-term risk is margin, not demand: the new 10 percent U.S. aluminum tariff plus wage and mix pressure cut gross margin from 43.9 percent to 38.5 percent in the first quarter, and management targets full tariff neutralization only by 2027.
• Watch quarterly gross margin against the reaffirmed 2026 guidance of $1.06 to $1.13 billion in revenue and $225 to $245 million in adjusted EBITDA.

Bull Case

The moat here is geography plus integration, and the company is unusually direct about it. The FY2025 10-K states that "we benefit from structural cost advantages in manufacturing and distribution due to our geographic location" and that these strengths "create a significant barrier to entry": a vertically integrated campus in Colombia produces glass and aluminum framing at costs U.S.-based fabricators struggle to match, then ships into the U.S. market a short sail away. The filing adds that this "lower cost manufacturing footprint allows us to offer competitive prices for our customers, while also providing innovative, high quality and high value-added products". The numbers agree with the prose: trailing operating income of about $216 million on roughly $1.01 billion of revenue is a 21 percent operating margin, and return on equity runs 20.3 percent. Cost-advantaged manufacturers are supposed to trade margin for share. This one keeps both.

Demand is doing its part. The 10-K records revenue climbing from $833.3 million in 2023 to $890.2 million in 2024, driven by U.S. commercial and single-family activity, and the first quarter of 2026 extended the run: revenue of $249.0 million, up 12 percent year over year, with multi-family and commercial revenues up 20.4 percent. The forward book is the strongest part of the story. Backlog reached a record $1.36 billion, up 19.1 percent, at a 1.3 times book-to-build ratio, with visibility extending into 2027 and growth increasingly coming from geographic expansion beyond Florida. A backlog growing faster than revenue is a company choosing which projects to take.

The balance sheet keeps the bet cheap to hold. Net debt of about $115 million is roughly half a year of operating income, the company is not burning cash, and the share count has declined about 1.6 percent a year over four years. Even the tariff, the clearest current headwind, has a management response on the record: the supply chain has been "strategically shifted" to "source U.S.-casted aluminum" per the 10-K, and pricing plus inventory actions are guided to neutralize the impact fully by 2027. At about 9 times operating income, the price asks for roughly 3 percent annual growth from a business booking orders 19 percent faster than it ships them.

Bear Case

The fragility is not leverage; it is where the cash and the costs sit. Structurally, this is a Colombian manufacturer whose revenue is concentrated in the U.S., and its own 10-K names the twin exposures: the U.S. business "is concentrated geographically in Florida", and the tariff discussion warns that "any further escalation in tariff rates, the potential removal of U.S.-Colombia Trade" agreement benefits could outrun the mitigation already in place. The first quarter showed what that exposure costs in real time: gross margin fell from 43.9 percent to 38.5 percent as the new 10 percent aluminum tariff, wages, and mix outweighed pricing gains, and management's own timeline pushes full offset out to 2027. A five-point gross margin drop in one year is the moat being taxed at the border.

Cash conversion is the second structural observation. Trailing free cash flow is only about $7.5 million against $216 million of operating income, because working capital and investment are absorbing what the income statement earns while large commercial jobs from the backlog move into execution, a dynamic the 10-K's own liquidity discussion ties to billings and project timing on large commercial jobs. Backlog-driven growth is real growth, but it is paid for up front: the $1.36 billion backlog converts to cash on the projects' schedule, not the company's, and a construction-cycle downturn would arrive precisely when that working capital is extended. The demand cycle itself is the familiar risk, and the filing concedes demand in the United States "could negatively impact demand for our products as it has in the past".

The valuation gives less downside protection than the 9 times multiple suggests, because the earnings being multiplied are the question. Today's price already sits about 20 to 25 percent above what book-value-plus-profitability and no-growth earnings-power reads defend, so the price is not below every lens, only below the peer-multiple one. If tariff neutralization slips, or Florida construction slows while the single-family line is merely stable, the margin that makes the 20.3 percent return on equity possible compresses, and the earnings-power reads that currently sit below the price fall further. The bear case is not that Tecnoglass is expensive. It is that a cost moat denominated in tariffs, one state's construction cycle, and a bilateral trade agreement is narrower than the trailing margins make it look.

Valuation

At $43.89 (July 10, 2026) the market pays about 9 times trailing operating income, which inverts to roughly 3.2 percent annual operating growth sustained for five years, a pace within what the business has recently delivered. That is a modest ask of a company whose revenue, per the FY2025 10-K, grew from $833.3 million in 2023 to $890.2 million in 2024 and reached about $1.01 billion on a trailing basis, and whose first-quarter 2026 revenue rose 12 percent. The price is not demanding a story; it is demanding continuation.

The methods cluster unusually tightly, and the disagreement is mild. Peer multiples land above today's price, with the price sitting roughly 25 percent below the sector-multiple read on both earnings and EBITDA bases. Forward growth paths land essentially at the price. The conservative lenses, book value plus profitability and no-growth earnings power, sit modestly below it, with the price roughly 20 to 25 percent above those reads. The one outlier is the trailing free-cash-flow lens, which lands far below everything else because trailing free cash flow was only about $7.5 million; that is the imprint of working capital funding large backlog projects in execution rather than a statement about earnings power, and the 10-K's liquidity discussion attributes the cash swing to billings on large commercial jobs. Read together: a value-supported name where the standard frames roughly agree, not a growth premium in search of justification.

Solvency is a footnote in the good sense. Net debt of about $115 million is roughly half a year of operating income on a pre-tax basis, gross debt is about $209 million, the company is not burning cash even in a heavy investment year, and the share count has declined about 1.6 percent annually over four years. The pivotal variable is the gross margin line: the tariff and input-cost compression from 43.9 percent to 38.5 percent determines whether the trailing operating income the 9 times multiple rests on is a floor or a high-water mark.

Catalysts

The reaffirmed 2026 guidance frames every upcoming print: revenue of $1.06 to $1.13 billion and adjusted EBITDA of $225 to $245 million, reiterated on June 1, 2026 with first-quarter results. The quarter itself delivered record revenue of $249.0 million, up 12 percent, with adjusted EBITDA of $61.5 million at a 24.7 percent margin, so the guidance requires no acceleration, only steadiness. The line to watch is gross margin, which fell from 43.9 percent to 38.5 percent year over year on the new 10 percent U.S. aluminum tariff plus wage and mix pressure; management is executing inventory actions and measured price increases and targets full tariff neutralization in 2027. Each quarter's margin print is a progress report on that plan.

The backlog supplies the medium-term calendar. At a record $1.36 billion, up 19.1 percent year over year with a 1.3 times book-to-build ratio, it extends visibility into 2027, driven by multi-family and commercial demand and geographic expansion beyond Florida. Conversion of that backlog into revenue, and the working capital it consumes along the way, will govern cash flow over the next several quarters. On the policy side, tariff developments cut both ways: the company has already shifted toward U.S.-cast aluminum sourcing to blunt the current tariff, while any change in U.S.-Colombia trade terms, in either direction, moves the cost math that underpins its structural advantage.

Peer Cohorts (Per Segment, With Filing Citations)

Core business (reported)

• NOVT (NOVANTA INC.)
• FY2025 10-K: …based on revenue, gross profit and operating profit. The following table shows the external revenues, gross profit margin and operating profit for each of the segments for the year ended December 31, 2025 (dollars in millions): Revenue Gross Profit Margin Operating Profit Automation Enabling Technologies $ 500.8 47.8…
• FY2025 10-K: …and we will continue to assess our operating and cost structure in the future. Our ability to reduce operating expenses and improve gross margin is dependent upon the nature of the actions we take and our subsequent ability to implement those actions and realize the expected cost savings and gross margin…
• SHO (Sunstone Hotel Investors, Inc.)
• FY2025 10-K: …competition from existing and new hotels operated under brands in the luxury, upper upscale, and upscale segments and competition from timeshare, vacation rentals, or sharing services. Increased competition could harm our occupancy or revenues or may lead our operators to increase service or amenity levels, which may…
• FY2025 10-K: …their significant renovations as they transitioned to Andaz Miami Beach and Marriott Long Beach Downtown, was 24.4%, 27.4%, 24.4%, and 23.8%, respectively. The Comparable Portfolio's revenue distribution in the first, second, third, and fourth quarters of 2024 was 24.9%, 27.5%, 24.8%, and 22.8%, respectively. ​…
• DAC (DANAOS CORPORATION)
• FY2025 20-F: …and major shipping companies. Some of these competitors have significantly greater financial resources than we do and can therefore operate larger fleets and may be able to offer better charter rates. We anticipate that other marine transportation companies may also enter the containership and drybulk shipping…
• FY2025 20-F: …and may reduce the overall demand for chartered-in tonnage. In addition, liner companies have progressively increased the proportion of their total fleet capacity that is directly owned rather than chartered-in from independent tonnage providers. This trend, if it continues, could reduce the pool of available charter…
• SBLK (STAR BULK CARRIERS CORP.)
• FY2025 20-F: …for obtaining loan facilities whose committed loans have not been drawn on or before the balance sheet date are recorded under "Other non-current assets" or "Other current assets", as applicable, and are reclassified as a direct deduction from the carrying amount of the loan facilities once financing takes place. F-…
• FY2025 20-F: …D. Property, Plant and Equipment We do not own any material real property. Our interests in the vessels in our fleet are our only material properties. See "Item 4. Information on the Company--B. Business Overview--General." Item 4A. Unresolved Staff Comments None. 49 Table of Contents Item 5. Operating and Financial…
• XHR (Xenia Hotels & Resorts, Inc.)
• FY2025 10-K: …decline in our revenues can have an adverse effect on our net cash flow, margins and profits. This effect can be especially pronounced during periods of economic contraction or slow economic growth. • Seasonality - The lodging industry is seasonal in nature, which can be expected to cause fluctuations in our hotel…
• FY2025 10-K: ) in each of their markets on the basis of several factors, including, among others, room rates, quality of accommodations, service levels and amenities, location, brand affiliation, reputation and reservation systems. Competition is often specific to the individual markets in which our hotels are located and includes…
• MGRC (McGRATH RENTCORP)
• FY2025 10-K: …of a number of factors, including equipment and labor availability, quality, price, - 21 - service, reliability, appearance, functionality and delivery terms. We may experience pricing pressures in our areas of operation in the future as some of our competitors seek to obtain market share by reducing prices. Some of…
• FY2025 10-K: …competitors and unanticipated consequences of expansion. In addition, expansion into new markets may be affected by local economic and market conditions. Expansion of our operations into new markets will require a significant amount of attention from our management, a commitment of financial resources and will…
• HWKN (HWKN)
• FY2025 10-K: …available in the future. In the event that certain raw materials become generally unavailable, suppliers may extend lead times or limit or cut off the supply of materials to us. As a result, we may not be able to supply or manufacture products for our customers. Intellectual Property. Our intellectual property…
• FY2025 10-K: …segments, which causes the most recent product costs to be recognized in our income statement. The LIFO inventory valuation method and the resulting cost of sales are consistent with our business practices of pricing to current chemical raw material prices. Inventories in our Health and Nutrition segment are valued…
• LOPE (Grand Canyon Education, Inc.)
• FY2025 10-K: …adverse impact on our future growth. We face competition from established and other emerging companies, which could divert university partners to our competitors, result in pricing pressure and significantly reduce our revenue. We expect existing competitors and new entrants to the educational services market to…
• FY2025 10-K: …of fiscal 2028 for interim reporting. Retrospective application is permitted. The Company does not expect the adoption of this guidance to have a material impact on the Company's financial condition, results of operations or statements of cash flows. In September 2025, the FASB issued ASU 2025-06, "Intangibles -…

Methodology Note

• Priced-in inversion: the valuation is inverted on the current price to recover the operating-income growth, duration, and steady-state margin the price embeds (ROE for financials, FFO growth for REITs).
• Valuation x-ray: the valuation models, grouped into four families (asset, earnings, relative, growth). Each model is expressed as a price/FV ratio (distance from price), not a point fair-value estimate. The spread across families is the disagreement.
• Solvency: net cash/debt, net-debt-to-NOPAT, interest coverage, and share-count CAGR from EDGAR financials (net debt / FFO and fixed-charge coverage for REITs; regulatory-capital framing for financials).
• Peer cohorts: per-segment comparables with deep-linkable SEC filing citations.

Fundamentals sourced from SEC EDGAR filings. Current price from Databento. The priced-in inversion and valuation x-ray are computed by the boothcheck engine; narrative composed by AI from the structured data.