NASDAQ:FLEX is probably undervalued for the fundamentals it is displaying.

Last update: Jun 10, 2024

Discover FLEX LTD (NASDAQ:FLEX), an undervalued stock highlighted by our stock screener. NASDAQ:FLEX showcases solid financial health and profitability while maintaining an appealing valuation. We'll explore the details.

ChartMill's Evaluation of Valuation

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. NASDAQ:FLEX has earned a 7 for valuation:

Based on the Price/Earnings ratio, FLEX is valued cheaply inside the industry as 86.51% of the companies are valued more expensively.
The average S&P500 Price/Earnings ratio is at 28.12. FLEX is valued rather cheaply when compared to this.
Compared to the rest of the industry, the Price/Forward Earnings ratio of FLEX indicates a rather cheap valuation: FLEX is cheaper than 82.54% of the companies listed in the same industry.
When comparing the Price/Forward Earnings ratio of FLEX to the average of the S&P500 Index (19.99), we can say FLEX is valued slightly cheaper.
FLEX's Enterprise Value to EBITDA ratio is rather cheap when compared to the industry. FLEX is cheaper than 94.44% of the companies in the same industry.
FLEX's Price/Free Cash Flow ratio is rather cheap when compared to the industry. FLEX is cheaper than 80.95% of the companies in the same industry.
FLEX has an outstanding profitability rating, which may justify a higher PE ratio.

Looking at the Profitability

ChartMill utilizes a Profitability Rating to assess stocks, scoring them on a scale of 0 to 10. This rating takes into account a variety of profitability ratios and margins, both in absolute terms and in comparison to industry peers. NASDAQ:FLEX has earned a 8 out of 10:

FLEX has a Return On Assets of 8.86%. This is amongst the best in the industry. FLEX outperforms 88.10% of its industry peers.
FLEX has a Return On Equity of 30.37%. This is amongst the best in the industry. FLEX outperforms 96.83% of its industry peers.
With an excellent Return On Invested Capital value of 17.42%, FLEX belongs to the best of the industry, outperforming 96.03% of the companies in the same industry.
The 3 year average ROIC (8.78%) for FLEX is below the current ROIC(17.42%), indicating increased profibility in the last year.
FLEX's Profit Margin of 3.35% is fine compared to the rest of the industry. FLEX outperforms 64.29% of its industry peers.
FLEX's Profit Margin has improved in the last couple of years.
FLEX has a better Operating Margin (4.43%) than 61.90% of its industry peers.
In the last couple of years the Operating Margin of FLEX has grown nicely.
In the last couple of years the Gross Margin of FLEX has grown nicely.

Looking at the Health

A critical element of ChartMill's stock evaluation is the Health Rating, which spans from 0 to 10. This rating considers multiple health factors, including liquidity and solvency, both in absolute terms and relative to industry peers. NASDAQ:FLEX has received a 5 out of 10:

FLEX has an Altman-Z score of 3.96. This indicates that FLEX is financially healthy and has little risk of bankruptcy at the moment.
The Altman-Z score of FLEX (3.96) is better than 69.05% of its industry peers.
The Debt to FCF ratio of FLEX (4.10) is better than 61.11% of its industry peers.

Growth Assessment of NASDAQ:FLEX

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. NASDAQ:FLEX has achieved a 5 out of 10:

Measured over the past years, FLEX shows a quite strong growth in Earnings Per Share. The EPS has been growing by 17.29% on average per year.
FLEX shows a strong growth in Revenue. In the last year, the Revenue has grown by 59.25%.
The Earnings Per Share is expected to grow by 8.00% on average over the next years. This is quite good.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.

Our Decent Value screener lists more Decent Value stocks and is updated daily.

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

Keep in mind

This article should in no way be interpreted as advice. The article is based on the observed metrics at the time of writing, but you should always make your own analysis and trade or invest at your own responsibility.