VALMONT INDUSTRIES (NYSE:VMI) emerged from our Peter Lynch-inspired screen as a stock with attractive growth potential at a reasonable valuation. The company operates in infrastructure and agriculture markets, providing essential products and services with steady demand. Below, we examine why VMI fits the criteria for long-term investors seeking growth at a reasonable price.
Key Strengths of VALMONT INDUSTRIES
- Sustainable Growth: VMI has delivered an average EPS growth of 18.77% over the past five years, aligning with Peter Lynch’s preference for companies with steady but not excessive growth.
- Reasonable Valuation: With a PEG ratio of 0.99 (below 1), the stock appears fairly priced relative to its earnings growth.
- Strong Profitability: The company boasts a Return on Equity (ROE) of 21.27%, well above the 15% threshold Lynch favored, indicating efficient use of shareholder capital.
- Healthy Balance Sheet: A Debt/Equity ratio of 0.45 and a Current Ratio of 2.26 reflect financial stability, reducing risk for long-term investors.
Fundamental Highlights
VALMONT INDUSTRIES scores 7 out of 10 in our fundamental analysis, with particularly strong marks in profitability and financial health. The company outperforms most peers in operating margins, ROE, and liquidity. While revenue growth has slowed recently, earnings remain on a positive trajectory.
For a deeper dive into the company’s financials, review the full fundamental report here.
Our Peter Lynch Strategy screener lists more stocks that meet these criteria and is updated regularly.
Disclaimer
This is not investing advice. The observations here are based on current data, but investors should conduct their own research before making decisions.
