GMS INC (NYSE:GMS) can be considered a quality stock. Here's why.

Quality investors are looking for the best of the best. Companies which are growing steadily and consistently, but are also in excellent financial condition. We will have a look here to see if GMS INC (NYSE:GMS) is suited for quality investing. Investors should of course do their own research, but we spotted GMS INC showing up in our Caviar Cruise quality screen, so it may be worth spending some more time on it.

Exploring Why NYSE:GMS Holds Appeal for Quality Investors.

• Over the past 5 years, GMS INC has experienced impressive revenue growth, with 16.24% increase. This demonstrates the company's ability to effectively expand its top line and suggests a positive outlook for future revenue generation.
• With a robust ROIC excluding cash and goodwill at 26.05%, GMS INC showcases its effective allocation of capital and operational excellence. This metric signifies the company's ability to generate attractive returns and supports its long-term financial performance.
• GMS INC maintains a healthy Debt/Free Cash Flow Ratio of 2.77, indicating a strong financial position and prudent debt management. This ratio suggests the company has sufficient free cash flow to cover its debt obligations and highlights its ability to generate cash from operations.
• With a favorable Profit Quality (5-year) ratio of 359.0%, GMS INC showcases its ability to consistently deliver high-quality profits. This metric signifies the company's financial strength and its capacity to generate sustainable earnings over an extended period.
• GMS INC has consistently achieved strong EBIT growth over the past 5 years, with a 33.49% increase. This underscores the company's effective management of its operating income and suggests a positive outlook for future profitability.
• GMS INC demonstrates a remarkable trend where its EBIT 5-year growth exceeds its Revenue 5-year growth. This indicates the company's ability to enhance its profitability through improved cost control and operational efficiency.

A complete fundamental analysis of NYSE:GMS

At ChartMill, a crucial aspect of their analysis is the assignment of a Fundamental Rating to each stock. This rating, ranging from 0 to 10, is calculated daily by considering numerous fundamental indicators and properties.

GMS gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 52 industry peers in the Trading Companies & Distributors industry. GMS gets an excellent profitability rating and is at the same time showing great financial health properties. GMS may be a bit undervalued, certainly considering the very reasonable score on growth With these ratings, GMS could be worth investigating further for value and quality investing!.

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

More ideas for quality investing can be found on ChartMill in our Caviar Cruise screen.

Disclaimer

This article should in no way be interpreted as advice in any way. 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.