In a market where value is scarce, NASDAQ:CROX offers a refreshing opportunity with its solid fundamentals.

CROCS INC (NASDAQ:CROX) is a hidden gem identified by our stock screening tool, featuring undervaluation and robust fundamentals. NASDAQ:CROX showcases decent financial health and profitability, coupled with an attractive price. Let's dig deeper into the analysis.

ChartMill's Evaluation of Valuation

ChartMill assigns a proprietary Valuation Rating to each stock. The score is computed by evaluating various valuation aspects, like price to earnings and free cash flow, both absolutely as relative to the market and industry. NASDAQ:CROX was assigned a score of 8 for valuation:

• Based on the Price/Earnings ratio of 8.70, the valuation of CROX can be described as reasonable.
• Compared to the rest of the industry, the Price/Earnings ratio of CROX indicates a rather cheap valuation: CROX is cheaper than 95.92% of the companies listed in the same industry.
• Compared to an average S&P500 Price/Earnings ratio of 25.74, CROX is valued rather cheaply.
• With a Price/Forward Earnings ratio of 8.52, the valuation of CROX can be described as very reasonable.
• 95.92% of the companies in the same industry are more expensive than CROX, based on the Price/Forward Earnings ratio.
• When comparing the Price/Forward Earnings ratio of CROX to the average of the S&P500 Index (21.31), we can say CROX is valued rather cheaply.
• Based on the Enterprise Value to EBITDA ratio, CROX is valued cheaper than 89.80% of the companies in the same industry.
• Based on the Price/Free Cash Flow ratio, CROX is valued cheaply inside the industry as 83.67% of the companies are valued more expensively.
• The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
• CROX has an outstanding profitability rating, which may justify a higher PE ratio.

Looking at the Profitability

Discover ChartMill's exclusive Profitability Rating, a proprietary metric that assesses stocks on a scale of 0 to 10. It takes into consideration various profitability ratios and margins, both in absolute terms and relative to industry peers. Notably, NASDAQ:CROX has achieved a 9:

• The Return On Assets of CROX (14.77%) is better than 95.92% of its industry peers.
• The Return On Equity of CROX (56.37%) is better than 97.96% of its industry peers.
• The Return On Invested Capital of CROX (20.12%) is better than 93.88% of its industry peers.
• Measured over the past 3 years, the Average Return On Invested Capital for CROX is significantly above the industry average of 10.85%.
• The last Return On Invested Capital (20.12%) for CROX is well below the 3 year average (28.22%), which needs to be investigated, but indicates that CROX had better years and this may not be a problem.
• Looking at the Profit Margin, with a value of 17.14%, CROX belongs to the top of the industry, outperforming 100.00% of the companies in the same industry.
• CROX's Profit Margin has improved in the last couple of years.
• CROX has a better Operating Margin (26.66%) than 100.00% of its industry peers.
• In the last couple of years the Operating Margin of CROX has grown nicely.
• CROX has a better Gross Margin (55.11%) than 71.43% of its industry peers.

Evaluating Health: NASDAQ:CROX

ChartMill employs its own Health Rating for stock assessment. This rating, ranging from 0 to 10, is calculated by examining various liquidity and solvency ratios. In the case of NASDAQ:CROX, the assigned 5 reflects its health status:

• CROX has an Altman-Z score of 3.56. This indicates that CROX is financially healthy and has little risk of bankruptcy at the moment.
• With a decent Altman-Z score value of 3.56, CROX is doing good in the industry, outperforming 63.27% of the companies in the same industry.
• CROX has a debt to FCF ratio of 2.32. This is a good value and a sign of high solvency as CROX would need 2.32 years to pay back of all of its debts.
• The Debt to FCF ratio of CROX (2.32) is better than 63.27% of its industry peers.
• Although CROX does not score too well on debt/equity it has very limited outstanding debt, which is well covered by the FCF. We will not put too much weight on the debt/equity number as it may be because of low equity, which could be a consequence of a share buyback program for instance. This needs to be investigated.

Understanding NASDAQ:CROX's Growth

ChartMill employs its own Growth Rating system for all stocks. This score, ranging from 0 to 10, is derived by evaluating different growth factors, such as EPS and revenue growth, taking into account both past performance and future projections. NASDAQ:CROX has earned a 8 for growth:

• The Earnings Per Share has grown by an nice 16.23% over the past year.
• Measured over the past years, CROX shows a very strong growth in Earnings Per Share. The EPS has been growing by 161.05% on average per year.
• CROX shows a strong growth in Revenue. In the last year, the Revenue has grown by 23.50%.
• The Revenue has been growing by 28.28% on average over the past years. This is a very strong growth!
• Based on estimates for the next years, CROX will show a quite strong growth in Earnings Per Share. The EPS will grow by 10.62% on average per year.
• CROX is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 8.30% yearly.

More Decent Value stocks can be found in our Decent Value screener.

Our latest full fundamental report of CROX contains the most current fundamental analsysis.

Disclaimer

This article should in no way be interpreted as advice in any way. The article is based on the observed metrics at the time of writing, but you should always make your own analysis and trade or invest at your own responsibility.