Despite its impressive fundamentals, NASDAQ:GCT remains undervalued.

Last update: May 1, 2024

GIGACLOUD TECHNOLOGY INC - A (NASDAQ:GCT) is a hidden gem identified by our stock screening tool, featuring undervaluation and robust fundamentals. NASDAQ:GCT showcases decent financial health and profitability, coupled with an attractive price. Let's dig deeper into the analysis.

How We Gauge Valuation for NASDAQ:GCT

ChartMill assigns a proprietary Valuation Rating to each stock. The score is computed by evaluating various valuation aspects, like price to earnings and free cash flow, both absolutely as relative to the market and industry. NASDAQ:GCT was assigned a score of 7 for valuation:

Based on the Price/Earnings ratio, GCT is valued a bit cheaper than 66.67% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 24.67, GCT is valued a bit cheaper.
A Price/Forward Earnings ratio of 11.30 indicates a reasonable valuation of GCT.
Compared to the rest of the industry, the Price/Forward Earnings ratio of GCT indicates a rather cheap valuation: GCT is cheaper than 83.33% of the companies listed in the same industry.
When comparing the Price/Forward Earnings ratio of GCT to the average of the S&P500 Index (21.02), we can say GCT is valued slightly cheaper.
GCT's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. GCT is cheaper than 66.67% of the companies in the same industry.
GCT's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
GCT has an outstanding profitability rating, which may justify a higher PE ratio.
A more expensive valuation may be justified as GCT's earnings are expected to grow with 26.50% in the coming years.

Exploring NASDAQ:GCT's 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:GCT has earned a 8 out of 10:

With an excellent Return On Assets value of 11.11%, GCT belongs to the best of the industry, outperforming 91.67% of the companies in the same industry.
With an excellent Return On Equity value of 32.39%, GCT belongs to the best of the industry, outperforming 91.67% of the companies in the same industry.
The Return On Invested Capital of GCT (14.04%) is better than 91.67% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for GCT is above the industry average of 11.01%.
GCT has a better Profit Margin (13.37%) than 91.67% of its industry peers.
In the last couple of years the Profit Margin of GCT has grown nicely.
With an excellent Operating Margin value of 16.11%, GCT belongs to the best of the industry, outperforming 91.67% of the companies in the same industry.

What does the Health looks like for NASDAQ:GCT

ChartMill employs a unique Health Rating system for all stocks. This rating, ranging from 0 to 10, is determined by analyzing various liquidity and solvency ratios. For NASDAQ:GCT, the assigned 7 for health provides valuable insights:

GCT has an Altman-Z score of 3.23. This indicates that GCT is financially healthy and has little risk of bankruptcy at the moment.
GCT has a debt to FCF ratio of 0.01. This is a very positive value and a sign of high solvency as it would only need 0.01 years to pay back of all of its debts.
GCT's Debt to FCF ratio of 0.01 is amongst the best of the industry. GCT outperforms 91.67% of its industry peers.
A Debt/Equity ratio of 0.00 indicates that GCT is not too dependend on debt financing.
The Debt to Equity ratio of GCT (0.00) is better than 83.33% of its industry peers.
With a decent Quick ratio value of 1.27, GCT is doing good in the industry, outperforming 75.00% of the companies in the same industry.

Evaluating Growth: NASDAQ:GCT

ChartMill assigns a Growth Rating to every stock. This score ranges from 0 to 10 and evaluates the different growth aspects like EPS and Revenue, both in the past as in the future. NASDAQ:GCT scores a 9 out of 10:

The Earnings Per Share has grown by an impressive 538.54% over the past year.
The Earnings Per Share has been growing by 92.98% on average over the past years. This is a very strong growth
Looking at the last year, GCT shows a very strong growth in Revenue. The Revenue has grown by 43.63%.
GCT shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 36.70% yearly.
GCT is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 26.50% yearly.
GCT is expected to show a strong growth in Revenue. In the coming years, the Revenue will grow by 33.48% yearly.

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

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

Disclaimer

This is not investing advice! The article highlights some of the observations at the time of writing, but you should always make your own analysis and invest based on your own insights.