NYSE:FHI appears to be flying under the radar despite its strong fundamentals.

Our stock screener has singled out FEDERATED HERMES INC (NYSE:FHI) as a stellar value proposition. NYSE:FHI not only scores well in profitability, solvency, and liquidity but also maintains a very reasonable price point. We'll explore this further.

Unpacking NYSE:FHI's Valuation Rating

ChartMill employs its own Valuation Rating system for all stocks. This score, ranging from 0 to 10, is determined by evaluating different valuation factors, including price to earnings and free cash flow, both in absolute terms and relative to the market and industry. NYSE:FHI has earned a 8 for valuation:

• Based on the Price/Earnings ratio of 9.09, the valuation of FHI can be described as reasonable.
• Compared to the rest of the industry, the Price/Earnings ratio of FHI indicates a somewhat cheap valuation: FHI is cheaper than 74.64% of the companies listed in the same industry.
• FHI's Price/Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 28.56.
• The Price/Forward Earnings ratio is 7.99, which indicates a rather cheap valuation of FHI.
• Compared to the rest of the industry, the Price/Forward Earnings ratio of FHI indicates a rather cheap valuation: FHI is cheaper than 82.30% of the companies listed in the same industry.
• FHI is valuated cheaply when we compare the Price/Forward Earnings ratio to 20.00, which is the current average of the S&P500 Index.
• Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of FHI indicates a rather cheap valuation: FHI is cheaper than 92.82% of the companies listed in the same industry.
• FHI's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. FHI is cheaper than 72.73% of the companies in the same industry.
• The excellent profitability rating of FHI may justify a higher PE ratio.

A Closer Look at Profitability for NYSE:FHI

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 96.17% of its industry peers.
• With an excellent Return On Equity value of 31.08%, FHI belongs to the best of the industry, outperforming 93.78% of the companies in the same industry.
• FHI's Return On Invested Capital of 20.24% is amongst the best of the industry. FHI outperforms 94.26% of its industry peers.
• Measured over the past 3 years, the Average Return On Invested Capital for FHI is significantly above the industry average of 8.22%.
• 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.
• FHI has a better Gross Margin (95.62%) than 93.30% of its industry peers.

How We Gauge Health for NYSE:FHI

ChartMill utilizes a Health Rating to assess stocks, scoring them on a scale of 0 to 10. This rating takes into account a variety of liquidity and solvency ratios, both in absolute terms and in comparison to industry peers. NYSE:FHI has earned a 9 out of 10:

• FHI has an Altman-Z score of 4.60. This indicates that FHI is financially healthy and has little risk of bankruptcy at the moment.
• FHI has a better Altman-Z score (4.60) than 84.69% 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.
• With an excellent Debt to FCF ratio value of 1.11, FHI belongs to the best of the industry, outperforming 84.21% of the companies in the same industry.
• A Debt/Equity ratio of 0.30 indicates that FHI is not too dependend on debt financing.
• FHI has a better Debt to Equity ratio (0.30) than 76.56% of its industry peers.
• 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 Current ratio of 3.39. This is amongst the best in the industry. FHI outperforms 82.78% of its industry peers.
• A Quick Ratio of 3.39 indicates that FHI has no problem at all paying its short term obligations.
• FHI has a Quick ratio of 3.39. This is amongst the best in the industry. FHI outperforms 82.78% of its industry peers.

ChartMill's Evaluation of Growth

To evaluate a stock's growth potential, ChartMill utilizes a Growth Rating on a scale of 0 to 10. This comprehensive assessment considers various growth aspects, including historical and estimated EPS and revenue growth. NYSE:FHI has achieved a 4 out of 10:

• FHI shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 13.55%, which is quite good.
• Looking at the last year, FHI shows a quite strong growth in Revenue. The Revenue has grown by 9.79% in the last year.

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Check the latest full fundamental report of FHI for a complete fundamental analysis.

Keep in mind

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.