MUELLER INDUSTRIES INC (NYSE:MLI) – A Potentially Undervalued Stock with Strong Fundamentals

MUELLER INDUSTRIES INC (NYSE:MLI) was identified by our stock screener as a decent value stock, combining solid profitability, financial health, and growth potential at a reasonable valuation. The company’s fundamentals suggest it may be trading below its intrinsic value, making it an interesting candidate for value investors.

Valuation

MLI has a Valuation Rating of 8/10, indicating it may be priced attractively compared to its fundamentals. Key points include:

• A P/E ratio of 13.58, below the industry average and cheaper than 83.6% of peers.
• A Forward P/E of 10.52, suggesting future earnings growth is not fully priced in.
• An Enterprise Value/EBITDA ratio that is lower than 80.5% of industry competitors.

Financial Health

The company earns a perfect Health Rating of 10/10, reflecting strong solvency and liquidity:

• No outstanding debt, giving it a Debt/Equity ratio of 0.
• A high Altman-Z score of 12.52, indicating low bankruptcy risk.
• Strong liquidity with a Current Ratio of 4.29 and Quick Ratio of 3.24, outperforming most peers.

Profitability

MLI scores a Profitability Rating of 9/10, with impressive margins and returns:

• Return on Assets (19.31%) and Return on Equity (23.40%) rank in the top tier of its industry.
• Operating Margin of 19.76%, well above the sector average.
• Consistent profitability over the past five years.

Growth

With a Growth Rating of 7/10, MLI shows strong historical and expected expansion:

• EPS growth of 42.6% annually over the past years.
• Revenue growth of 9.17% on average in recent years.
• Analysts project 14.15% annual EPS growth in the coming years.

Our Decent Value Stocks screener lists more stocks with similar characteristics. For a deeper dive, review the full fundamental report on MLI.

Disclaimer

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