TNC Should I Buy
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Tennant Co (TNC) is not a good buy for a beginner investor with a long-term strategy at this time. The company is facing significant financial challenges, ongoing legal investigations, and weak technical indicators. While hedge funds are buying, the overall sentiment and fundamentals suggest holding off on investment until the company stabilizes.
The MACD is negative and expanding, indicating a bearish trend. The RSI is extremely oversold at 6.722, suggesting potential for a short-term bounce but not a strong long-term entry. Moving averages are converging, showing no clear trend reversal. Key support is at 58.616, with resistance at 64.635, indicating limited upside potential in the near term.
Hedge funds are significantly increasing their holdings, with an 8733.45% increase in buying over the last quarter.
Legal investigations into potential securities fraud and operational mismanagement are ongoing. The new ERP system caused production disruptions, negatively impacting operations and market performance. Analysts have downgraded the stock, citing weak near-term profitability and cash flow.
In Q4 2025, revenue dropped 11.34% YoY to $291.6 million. Net income fell by 166.67% YoY to -$4.4 million, and EPS dropped by 168.57% YoY to -$0.24. Gross margin also declined by 16.46% YoY to 34.57%. Overall, the company is experiencing significant financial deterioration.
Freedom Capital downgraded Tennant to Hold from Buy with a price target of $67, down from $93, citing weak Q4 performance and ongoing operational challenges. Analysts expect these issues to persist into 2026.
