Don't overlook NYSE:FHI—it's a hidden gem with strong fundamentals and an attractive price tag.

Last update: May 24, 2024

Uncover the hidden value in FEDERATED HERMES INC (NYSE:FHI) as our stock screening tool recommends it as an undervalued choice. NYSE:FHI maintains a robust financial position and offers an attractive pricing perspective. Let's dig deeper into the analysis.

Valuation Examination for NYSE:FHI

ChartMill assigns a Valuation Rating to each stock, ranging from 0 to 10. This rating is calculated by analyzing different valuation elements, such as price to earnings and free cash flow, both in absolute terms and relative to the market and industry. In the case of NYSE:FHI, the assigned 7 reflects its valuation:

Based on the Price/Earnings ratio of 9.24, the valuation of FHI can be described as reasonable.
Based on the Price/Earnings ratio, FHI is valued a bit cheaper than the industry average as 73.33% of the companies are valued more expensively.
FHI is valuated cheaply when we compare the Price/Earnings ratio to 28.05, which is the current average of the S&P500 Index.
With a Price/Forward Earnings ratio of 8.05, the valuation of FHI can be described as very reasonable.
Based on the Price/Forward Earnings ratio, FHI is valued a bit cheaper than 78.57% of the companies in the same industry.
FHI is valuated cheaply when we compare the Price/Forward Earnings ratio to 19.81, which is the current average of the S&P500 Index.
93.81% of the companies in the same industry are more expensive than FHI, based on the Enterprise Value to EBITDA ratio.
Based on the Price/Free Cash Flow ratio, FHI is valued a bit cheaper than the industry average as 70.00% of the companies are valued more expensively.
FHI has an outstanding profitability rating, which may justify a higher PE ratio.

Looking at the Profitability

ChartMill employs its own Profitability Rating system for stock evaluation. This score, ranging from 0 to 10, is derived from an analysis of diverse profitability metrics and margins. In the case of NYSE:FHI, the assigned 8 is noteworthy for profitability:

The Return On Assets of FHI (17.09%) is better than 96.19% of its industry peers.
FHI has a better Return On Equity (31.08%) than 93.81% of its industry peers.
Looking at the Return On Invested Capital, with a value of 20.24%, FHI belongs to the top of the industry, outperforming 95.24% of the companies in the same industry.
FHI had an Average Return On Invested Capital over the past 3 years of 16.38%. This is significantly above the industry average of 8.41%.
The last Return On Invested Capital (20.24%) for FHI is above the 3 year average (16.38%), which is a sign of increasing profitability.
The Gross Margin of FHI (95.62%) is better than 93.81% of its industry peers.

Analyzing Health Metrics

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 NYSE:FHI, the assigned 9 reflects its health status:

An Altman-Z score of 4.63 indicates that FHI is not in any danger for bankruptcy at the moment.
The Altman-Z score of FHI (4.63) is better than 84.29% of its industry peers.
FHI has a debt to FCF ratio of 1.11. This is a very positive value and a sign of high solvency as it would only need 1.11 years to pay back of all of its debts.
FHI has a better Debt to FCF ratio (1.11) than 84.29% of its industry peers.
A Debt/Equity ratio of 0.30 indicates that FHI is not too dependend on debt financing.
Looking at the Debt to Equity ratio, with a value of 0.30, FHI is in the better half of the industry, outperforming 76.19% of the companies in the same industry.
FHI has a Current Ratio of 3.39. This indicates that FHI is financially healthy and has no problem in meeting its short term obligations.
FHI has a better Current ratio (3.39) than 83.81% of its industry peers.
FHI has a Quick Ratio of 3.39. This indicates that FHI is financially healthy and has no problem in meeting its short term obligations.
FHI has a Quick ratio of 3.39. This is amongst the best in the industry. FHI outperforms 83.81% of its industry peers.

Looking at the Growth

ChartMill assigns a proprietary Growth Rating to each stock. The score is computed by evaluating various growth aspects, like EPS and revenue growth. We take into account the history as well as the estimated future numbers. NYSE:FHI was assigned a score of 4 for growth:

The Earnings Per Share has grown by an nice 13.55% over the past year.
The Revenue has grown by 9.79% in the past year. This is quite good.

Every day, new Decent Value stocks can be found on ChartMill in our Decent Value screener.

For an up to date full fundamental analysis you can check the fundamental report of FHI

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.