Investors should take notice of NASDAQ:PPC—it offers a great deal for the fundamentals it presents.

Our stock screener has spotted PILGRIM'S PRIDE CORP (NASDAQ:PPC) as an undervalued stock with solid fundamentals. NASDAQ:PPC shows decent health and profitability. At the same time it remains remains attractively priced. We'll dive into each aspect below.

Evaluating Valuation: NASDAQ:PPC

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:PPC was assigned a score of 8 for valuation:

• PPC is valuated reasonably with a Price/Earnings ratio of 9.56.
• Based on the Price/Earnings ratio, PPC is valued cheaply inside the industry as 88.24% of the companies are valued more expensively.
• When comparing the Price/Earnings ratio of PPC to the average of the S&P500 Index (30.30), we can say PPC is valued rather cheaply.
• Based on the Price/Forward Earnings ratio of 10.90, the valuation of PPC can be described as reasonable.
• 87.06% of the companies in the same industry are more expensive than PPC, based on the Price/Forward Earnings ratio.
• The average S&P500 Price/Forward Earnings ratio is at 23.06. PPC is valued rather cheaply when compared to this.
• Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of PPC indicates a rather cheap valuation: PPC is cheaper than 81.18% of the companies listed in the same industry.
• Based on the Price/Free Cash Flow ratio, PPC is valued cheaper than 83.53% of the companies in the same industry.
• PPC has an outstanding profitability rating, which may justify a higher PE ratio.

Exploring NASDAQ:PPC'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:PPC has earned a 8 out of 10:

• With an excellent Return On Assets value of 10.20%, PPC belongs to the best of the industry, outperforming 90.59% of the companies in the same industry.
• Looking at the Return On Equity, with a value of 25.63%, PPC belongs to the top of the industry, outperforming 94.12% of the companies in the same industry.
• PPC's Return On Invested Capital of 16.32% is amongst the best of the industry. PPC outperforms 96.47% of its industry peers.
• PPC had an Average Return On Invested Capital over the past 3 years of 12.54%. This is above the industry average of 9.02%.
• The last Return On Invested Capital (16.32%) for PPC is above the 3 year average (12.54%), which is a sign of increasing profitability.
• With a decent Profit Margin value of 6.08%, PPC is doing good in the industry, outperforming 75.29% of the companies in the same industry.
• In the last couple of years the Profit Margin of PPC has grown nicely.
• PPC has a better Operating Margin (8.95%) than 69.41% of its industry peers.
• In the last couple of years the Operating Margin of PPC has grown nicely.
• PPC's Gross Margin has improved in the last couple of years.

Unpacking NASDAQ:PPC's Health Rating

ChartMill assigns a Health Rating to every stock. This score ranges from 0 to 10 and evaluates the different health aspects like liquidity and solvency, both absolutely, but also relative to the industry peers. NASDAQ:PPC scores a 7 out of 10:

• An Altman-Z score of 4.03 indicates that PPC is not in any danger for bankruptcy at the moment.
• With a decent Altman-Z score value of 4.03, PPC is doing good in the industry, outperforming 80.00% of the companies in the same industry.
• PPC has a debt to FCF ratio of 2.12. This is a good value and a sign of high solvency as PPC would need 2.12 years to pay back of all of its debts.
• PPC has a Debt to FCF ratio of 2.12. This is in the better half of the industry: PPC outperforms 76.47% of its industry peers.
• Although PPC does not score too well on debt/equity it has very limited outstanding debt, which is well covered by the FCF. We will not put too much weight on the debt/equity number as it may be because of low equity, which could be a consequence of a share buyback program for instance. This needs to be investigated.
• PPC has a Current Ratio of 2.01. This indicates that PPC is financially healthy and has no problem in meeting its short term obligations.
• PPC has a Quick ratio of 1.31. This is in the better half of the industry: PPC outperforms 70.59% of its industry peers.

Growth Assessment of NASDAQ:PPC

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. NASDAQ:PPC boasts a 4 out of 10:

• PPC shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 220.71%, which is quite impressive.
• The Earnings Per Share has been growing by 27.16% on average over the past years. This is a very strong growth
• PPC shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 9.40% yearly.

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

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

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.