APOGEE ENTERPRISES INC (NASDAQ:APOG) - A GARP Candidate Worth Considering

APOGEE ENTERPRISES INC (NASDAQ:APOG) surfaced in our Peter Lynch-inspired screen, which identifies companies with sustainable growth and reasonable valuations. The architectural products manufacturer meets several key criteria for long-term investors seeking growth at a reasonable price (GARP). Below, we examine why APOG stands out.

Why APOG Fits the GARP Profile

• Earnings Growth: APOG has delivered a 5-year average EPS growth of 15.82%, aligning with Lynch’s preference for steady but sustainable expansion (15-30% range).
• Attractive Valuation: With a PEG ratio of 0.50 (well below the preferred threshold of 1), the stock appears undervalued relative to its growth.
• Strong Profitability: A return on equity (ROE) of 17.43% exceeds Lynch’s 15% benchmark, indicating efficient use of shareholder capital.
• Healthy Balance Sheet: The debt-to-equity ratio of 0.58 is within Lynch’s tolerance (below 0.6), and the current ratio of 1.55 suggests solid short-term liquidity.

Fundamental Snapshot

Our fundamental analysis rates APOG a 5/10, noting:

• Valuation: The stock trades at a P/E of 7.92, cheaper than 97% of its industry peers.
• Dividend Appeal: A 2.77% yield with a 7+ year growth streak adds income appeal.
• Mixed Growth Signals: While past EPS growth is strong, near-term estimates suggest a slowdown (-9% expected).

For investors comfortable with cyclical industries, APOG’s combination of value, profitability, and disciplined growth could make it a candidate for further research.

Our Peter Lynch Strategy screener lists more stocks matching these criteria.

Disclaimer

This is not investing advice! The article highlights observations at the time of writing, but always conduct your own analysis before making investment decisions.