FABRINET (NYSE:FN) is showing decent growth, but is still valued reasonably.

Our stock screening tool has pinpointed FABRINET (NYSE:FN) as a growth stock that isn't overvalued. FN is excelling in various growth indicators while maintaining a solid financial footing. Furthermore, it remains attractively priced. Let's delve into the specifics below.

What does the Growth looks like for FN

A key component of ChartMill's stock assessment is the Growth Rating, which spans from 0 to 10. This rating evaluates diverse growth factors, such as EPS and revenue growth, considering both past performance and future projections. FN has received a 7 out of 10:

• The Earnings Per Share has grown by an impressive 24.37% over the past year.
• The Earnings Per Share has been growing by 18.44% on average over the past years. This is quite good.
• The Revenue has grown by 14.83% in the past year. This is quite good.
• FN shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 12.72% yearly.
• FN is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 17.01% yearly.
• The Revenue is expected to grow by 15.80% on average over the next years. This is quite good.
• The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.

Evaluating Valuation: FN

ChartMill provides a Valuation Rating to every stock, ranging from 0 to 10. This rating assesses various valuation aspects, comparing price to earnings and cash flows, while considering factors like profitability and growth. FN boasts a 5 out of 10:

• Compared to the rest of the industry, the Price/Earnings ratio of FN indicates a somewhat cheap valuation: FN is cheaper than 69.92% of the companies listed in the same industry.
• FN's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 28.63.
• Compared to the rest of the industry, the Price/Forward Earnings ratio of FN indicates a somewhat cheap valuation: FN is cheaper than 70.73% of the companies listed in the same industry.
• FN's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. FN is cheaper than 65.85% of the companies in the same industry.
• FN has an outstanding profitability rating, which may justify a higher PE ratio.
• FN's earnings are expected to grow with 17.01% in the coming years. This may justify a more expensive valuation.

Unpacking FN's Health Rating

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 FN, the assigned 9 reflects its health status:

• FN has an Altman-Z score of 10.26. This indicates that FN is financially healthy and has little risk of bankruptcy at the moment.
• FN has a better Altman-Z score (10.26) than 91.06% of its industry peers.
• There is no outstanding debt for FN. This means it has a Debt/Equity and Debt/FCF ratio of 0 and it is amongst the best of the sector and industry.
• A Current Ratio of 3.32 indicates that FN has no problem at all paying its short term obligations.
• The Current ratio of FN (3.32) is better than 67.48% of its industry peers.
• A Quick Ratio of 2.58 indicates that FN has no problem at all paying its short term obligations.
• With a decent Quick ratio value of 2.58, FN is doing good in the industry, outperforming 66.67% of the companies in the same industry.

Assessing Profitability for FN

ChartMill utilizes a Profitability Rating to assess stocks, scoring them on a scale of 0 to 10. This rating takes into account a variety of profitability ratios and margins, both in absolute terms and in comparison to industry peers. FN has earned a 8 out of 10:

• Looking at the Return On Assets, with a value of 12.82%, FN belongs to the top of the industry, outperforming 94.31% of the companies in the same industry.
• With an excellent Return On Equity value of 17.69%, FN belongs to the best of the industry, outperforming 88.62% of the companies in the same industry.
• FN has a better Return On Invested Capital (12.67%) than 89.43% of its industry peers.
• Measured over the past 3 years, the Average Return On Invested Capital for FN is above the industry average of 8.68%.
• With an excellent Profit Margin value of 10.44%, FN belongs to the best of the industry, outperforming 83.74% of the companies in the same industry.
• FN's Profit Margin has improved in the last couple of years.
• Looking at the Operating Margin, with a value of 9.65%, FN belongs to the top of the industry, outperforming 80.49% of the companies in the same industry.
• In the last couple of years the Operating Margin of FN has grown nicely.
• In the last couple of years the Gross Margin of FN has grown nicely.

Every day, new Affordable Growth stocks can be found on ChartMill in our Affordable Growth screener.

Check the latest full fundamental report of FN for a complete fundamental analysis.

Disclaimer

Important Note: The content of this article is not intended as trading advice. It is essential to perform your own analysis and exercise caution when making trading decisions. The article presents observations created by automated analysis but does not guarantee any trading or investment outcomes. Always trade responsibly and make independent judgments.