GLOBUS MEDICAL INC - A (NYSE:GMED) - A Strong Growth Stock at a Reasonable Price

GLOBUS MEDICAL INC - A (NYSE:GMED) was identified as an affordable growth stock by our screening process. The company demonstrates solid growth potential while maintaining reasonable valuation metrics, along with decent financial health and profitability. Below, we examine why GMED fits the criteria for investors seeking growth at a sensible price.

Growth Prospects

GMED has shown strong historical growth, with key highlights including:

• Revenue Growth: Revenue increased by 32.26% over the past year, with a five-year average growth rate of 26.25%.
• Earnings Growth: EPS grew by 23.02% in the last year, with a five-year annualized growth rate of 13.19%.
• Future Expectations: Analysts project EPS growth of 12.10% annually in the coming years, indicating sustained momentum.

These figures place GMED in a favorable position compared to many industry peers, reinforcing its growth credentials.

Valuation Assessment

Despite its growth, GMED remains reasonably priced:

• P/E Ratio: At 18.79, GMED trades below the industry average P/E of 28.78 and the S&P 500 average of 24.95.
• Forward P/E: The forward P/E of 14.53 suggests a more attractive valuation relative to future earnings.
• Price-to-Cash Flow: GMED is cheaper than 90.48% of its industry peers based on this metric.

While not the cheapest stock, the valuation appears justified given the company’s growth trajectory.

Financial Health & Profitability

GMED maintains a solid financial position:

• Strong Solvency: A debt-free balance sheet and a high Altman-Z score (8.97) indicate low bankruptcy risk.
• Liquidity: A current ratio of 4.45 and quick ratio of 2.72 reflect ample short-term financial flexibility.
• Profitability: Margins are healthy, with a 7.39% net profit margin, though recent declines in operating and gross margins warrant monitoring.

Our Affordable Growth screener lists more stocks with similar characteristics, updated daily.
For a deeper dive, review the full fundamental analysis of GMED.

Disclaimer

This is not investing advice. The observations here are based on current data, but investors should conduct their own research before making decisions.