Investors should take notice of PHOTRONICS INC (NASDAQ:PLAB)—it offers a great deal for the fundamentals it presents.

Last update: Mar 26, 2025

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

Understanding PLAB's Valuation

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. PLAB was assigned a score of 8 for valuation:

With a Price/Earnings ratio of 10.37, the valuation of PLAB can be described as very reasonable.
95.37% of the companies in the same industry are more expensive than PLAB, based on the Price/Earnings ratio.
The average S&P500 Price/Earnings ratio is at 29.07. PLAB is valued rather cheaply when compared to this.
The Price/Forward Earnings ratio is 9.19, which indicates a very decent valuation of PLAB.
96.30% of the companies in the same industry are more expensive than PLAB, based on the Price/Forward Earnings ratio.
Compared to an average S&P500 Price/Forward Earnings ratio of 22.05, PLAB is valued rather cheaply.
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of PLAB indicates a rather cheap valuation: PLAB is cheaper than 97.22% of the companies listed in the same industry.
PLAB's Price/Free Cash Flow ratio is rather cheap when compared to the industry. PLAB is cheaper than 100.00% of the companies in the same industry.
The decent profitability rating of PLAB may justify a higher PE ratio.

Assessing Profitability for PLAB

ChartMill assigns a proprietary Profitability Rating to each stock. The score is computed by evaluating various profitability ratios and margins and ranges from 0 to 10. PLAB was assigned a score of 7 for profitability:

PLAB's Return On Assets of 8.64% is fine compared to the rest of the industry. PLAB outperforms 74.07% of its industry peers.
PLAB's Return On Equity of 13.07% is fine compared to the rest of the industry. PLAB outperforms 75.00% of its industry peers.
The Return On Invested Capital of PLAB (10.39%) is better than 79.63% of its industry peers.
The Profit Margin of PLAB (17.08%) is better than 75.00% of its industry peers.
In the last couple of years the Profit Margin of PLAB has grown nicely.
Looking at the Operating Margin, with a value of 25.06%, PLAB belongs to the top of the industry, outperforming 85.19% of the companies in the same industry.
PLAB's Operating Margin has improved in the last couple of years.
In the last couple of years the Gross Margin of PLAB has grown nicely.

A Closer Look at Health for PLAB

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 PLAB, the assigned 7 for health provides valuable insights:

PLAB has a debt to FCF ratio of 0.02. This is a very positive value and a sign of high solvency as it would only need 0.02 years to pay back of all of its debts.
PLAB's Debt to FCF ratio of 0.02 is amongst the best of the industry. PLAB outperforms 87.96% of its industry peers.
A Debt/Equity ratio of 0.00 indicates that PLAB is not too dependend on debt financing.
PLAB's Debt to Equity ratio of 0.00 is fine compared to the rest of the industry. PLAB outperforms 68.52% of its industry peers.
A Current Ratio of 5.66 indicates that PLAB has no problem at all paying its short term obligations.
The Current ratio of PLAB (5.66) is better than 83.33% of its industry peers.
PLAB has a Quick Ratio of 5.31. This indicates that PLAB is financially healthy and has no problem in meeting its short term obligations.
PLAB has a Quick ratio of 5.31. This is amongst the best in the industry. PLAB outperforms 88.89% of its industry peers.

How We Gauge Growth for PLAB

Every stock receives a Growth Rating from ChartMill, ranging from 0 to 10. This rating assesses various growth aspects, including historical and projected EPS and revenue growth. PLAB boasts a 4 out of 10:

The Earnings Per Share has been growing by 33.90% on average over the past years. This is a very strong growth
Measured over the past years, PLAB shows a quite strong growth in Revenue. The Revenue has been growing by 9.50% on average per year.
Based on estimates for the next years, PLAB will show a quite strong growth in Earnings Per Share. The EPS will grow by 8.85% on average per year.

More Decent Value stocks can be found in our Decent Value screener.

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

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.