FLEX LTD (FLEX)
SG9999000020 - Common Stock
We assign a fundamental rating of 5 out of 10 to FLEX. FLEX was compared to 127 industry peers in the Electronic Equipment, Instruments & Components industry. FLEX has an excellent profitability rating, but there are concerns on its financial health. FLEX has a bad growth rate and is valued cheaply.
1. Profitability
1.1 Basic Checks
In the past year FLEX was profitable.
In the past year FLEX had a positive cash flow from operations.
Each year in the past 5 years FLEX has been profitable.
The reported operating cash flow has been mixed in the past 5 years: FLEX reported negative operating cash flow in multiple years.
1.2 Ratios
FLEX has a Return On Assets of 3.70%. This is in the better half of the industry: FLEX outperforms 60.32% of its industry peers.
FLEX has a better Return On Equity (12.62%) than 78.57% of its industry peers.
With an excellent Return On Invested Capital value of 11.49%, FLEX belongs to the best of the industry, outperforming 82.54% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for FLEX is in line with the industry average of 9.42%.
The last Return On Invested Capital (11.49%) for FLEX is above the 3 year average (10.18%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.7% | ||
| ROE | 12.62% | ||
| ROIC | 11.49% |
ROA(3y)4.14%
ROA(5y)2.75%
ROE(3y)18.44%
ROE(5y)12.31%
ROIC(3y)10.18%
ROIC(5y)9.64%
1.3 Margins
FLEX has a Profit Margin (2.56%) which is comparable to the rest of the industry.
In the last couple of years the Profit Margin of FLEX has grown nicely.
FLEX's Operating Margin of 4.77% is fine compared to the rest of the industry. FLEX outperforms 62.70% of its industry peers.
FLEX's Operating Margin has improved in the last couple of years.
Looking at the Gross Margin, with a value of 8.67%, FLEX is doing worse than 83.33% of the companies in the same industry.
FLEX's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 4.77% | ||
| PM (TTM) | 2.56% | ||
| GM | 8.67% |
OM growth 3Y15.2%
OM growth 5Y6.67%
PM growth 3Y93%
PM growth 5Y9.16%
GM growth 3Y6.08%
GM growth 5Y2.9%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so FLEX is still creating some value.
The number of shares outstanding for FLEX has been reduced compared to 1 year ago.
The number of shares outstanding for FLEX has been reduced compared to 5 years ago.
Compared to 1 year ago, FLEX has an improved debt to assets ratio.
2.2 Solvency
An Altman-Z score of 2.48 indicates that FLEX is not a great score, but indicates only limited risk for bankruptcy at the moment.
FLEX has a Altman-Z score of 2.48. This is comparable to the rest of the industry: FLEX outperforms 45.24% of its industry peers.
The Debt to FCF ratio of FLEX is 7.34, which is on the high side as it means it would take FLEX, 7.34 years of fcf income to pay off all of its debts.
The Debt to FCF ratio of FLEX (7.34) is comparable to the rest of the industry.
A Debt/Equity ratio of 0.58 indicates that FLEX is somewhat dependend on debt financing.
Looking at the Debt to Equity ratio, with a value of 0.58, FLEX is doing worse than 77.78% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.58 | ||
| Debt/FCF | 7.34 | ||
| Altman-Z | 2.48 |
ROIC/WACC1.24
WACC9.27%
2.3 Liquidity
A Current Ratio of 1.59 indicates that FLEX should not have too much problems paying its short term obligations.
With a Current ratio value of 1.59, FLEX is not doing good in the industry: 74.60% of the companies in the same industry are doing better.
FLEX has a Quick Ratio of 1.59. This is a bad value and indicates that FLEX is not financially healthy enough and could expect problems in meeting its short term obligations.
The Quick ratio of FLEX (0.86) is worse than 84.13% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.59 | ||
| Quick Ratio | 0.86 |
3. Growth
3.1 Past
FLEX shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 10.82%, which is quite good.
Measured over the past years, FLEX shows a quite strong growth in Earnings Per Share. The EPS has been growing by 16.79% on average per year.
The Revenue has decreased by -1.12% in the past year.
The Revenue has been growing slightly by 3.59% on average over the past years.
EPS 1Y (TTM)10.82%
EPS 3Y24.45%
EPS 5Y16.79%
EPS growth Q2Q14.52%
Revenue 1Y (TTM)-1.12%
Revenue growth 3Y7.82%
Revenue growth 5Y3.59%
Revenue growth Q2Q-8.42%
3.2 Future
FLEX is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 8.43% yearly.
Based on estimates for the next years, FLEX will show a decrease in Revenue. The Revenue will decrease by -2.28% on average per year.
EPS Next Y7.28%
EPS Next 2Y2.53%
EPS Next 3Y8.43%
EPS Next 5YN/A
Revenue Next Year-7.53%
Revenue Next 2Y-5.88%
Revenue Next 3Y-2.28%
Revenue Next 5YN/A
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 10.79, the valuation of FLEX can be described as very reasonable.
Based on the Price/Earnings ratio, FLEX is valued cheaply inside the industry as 88.10% of the companies are valued more expensively.
FLEX is valuated cheaply when we compare the Price/Earnings ratio to 24.80, which is the current average of the S&P500 Index.
A Price/Forward Earnings ratio of 11.00 indicates a reasonable valuation of FLEX.
Based on the Price/Forward Earnings ratio, FLEX is valued cheaply inside the industry as 87.30% of the companies are valued more expensively.
When comparing the Price/Forward Earnings ratio of FLEX to the average of the S&P500 Index (21.27), we can say FLEX is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 10.79 | ||
| Fwd PE | 11 |
4.2 Price Multiples
90.48% of the companies in the same industry are more expensive than FLEX, based on the Enterprise Value to EBITDA ratio.
FLEX's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. FLEX is cheaper than 69.84% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 24.86 | ||
| EV/EBITDA | 6.4 |
4.3 Compensation for Growth
The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
FLEX has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)1.48
PEG (5Y)0.64
EPS Next 2Y2.53%
EPS Next 3Y8.43%
5. Dividend
5.1 Amount
No dividends for FLEX!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
FLEX LTD
NASDAQ:FLEX (4/18/2024, 7:00:00 PM)
Premarket: 28.09 +0.46 (+1.66%)27.63
-0.45 (-1.6%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupTechnology Hardware & Equipment
GICS IndustryElectronic Equipment, Instruments & Components
Earnings (Last)
Earnings (Next)
Inst Owners
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Market Cap11.64B
Analysts
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Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Dividend Growth(5Y)
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Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 10.79 | ||
| Fwd PE | 11 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)1.48
PEG (5Y)0.64
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.7% | ||
| ROE | 12.62% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 4.77% | ||
| PM (TTM) | 2.56% | ||
| GM | 8.67% | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover1.44
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.58 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 1.59 | ||
| Quick Ratio | 0.86 | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
Growth
EPS 1Y (TTM)10.82%
EPS 3Y24.45%
EPS 5Y
EPS growth Q2Q
EPS Next Y7.28%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)-1.12%
Revenue growth 3Y7.82%
Revenue growth 5Y
Revenue growth Q2Q
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
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