QIFU TECHNOLOGY INC (NASDAQ:QFIN) is probably undervalued for the fundamentals it is displaying.

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

Valuation Assessment of NASDAQ:QFIN

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:QFIN was assigned a score of 8 for valuation:

• QFIN is valuated reasonably with a Price/Earnings ratio of 8.27.
• Based on the Price/Earnings ratio, QFIN is valued a bit cheaper than 69.81% of the companies in the same industry.
• QFIN's Price/Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 29.16.
• The Price/Forward Earnings ratio is 6.25, which indicates a rather cheap valuation of QFIN.
• 84.91% of the companies in the same industry are more expensive than QFIN, based on the Price/Forward Earnings ratio.
• QFIN's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 21.95.
• Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of QFIN indicates a rather cheap valuation: QFIN is cheaper than 83.02% of the companies listed in the same industry.
• The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
• The excellent profitability rating of QFIN may justify a higher PE ratio.
• QFIN's earnings are expected to grow with 27.08% in the coming years. This may justify a more expensive valuation.

Understanding NASDAQ:QFIN'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:QFIN has earned a 8 out of 10:

• With an excellent Return On Assets value of 11.62%, QFIN belongs to the best of the industry, outperforming 90.57% of the companies in the same industry.
• QFIN's Return On Equity of 23.90% is amongst the best of the industry. QFIN outperforms 84.91% of its industry peers.
• The Return On Invested Capital of QFIN (18.00%) is better than 96.23% of its industry peers.
• Measured over the past 3 years, the Average Return On Invested Capital for QFIN is significantly above the industry average of 7.44%.
• With an excellent Profit Margin value of 31.78%, QFIN belongs to the best of the industry, outperforming 92.45% of the companies in the same industry.
• QFIN's Operating Margin of 40.27% is amongst the best of the industry. QFIN outperforms 98.11% of its industry peers.
• Looking at the Gross Margin, with a value of 83.13%, QFIN belongs to the top of the industry, outperforming 81.13% of the companies in the same industry.

Unpacking NASDAQ:QFIN's Health Rating

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:QFIN has received a 7 out of 10:

• The Debt to FCF ratio of QFIN is 0.12, which is an excellent value as it means it would take QFIN, only 0.12 years of fcf income to pay off all of its debts.
• QFIN has a Debt to FCF ratio of 0.12. This is amongst the best in the industry. QFIN outperforms 92.45% of its industry peers.
• QFIN has a Debt/Equity ratio of 0.05. This is a healthy value indicating a solid balance between debt and equity.
• Looking at the Debt to Equity ratio, with a value of 0.05, QFIN belongs to the top of the industry, outperforming 86.79% of the companies in the same industry.
• QFIN has a Current Ratio of 2.56. This indicates that QFIN is financially healthy and has no problem in meeting its short term obligations.
• QFIN's Current ratio of 2.56 is fine compared to the rest of the industry. QFIN outperforms 71.70% of its industry peers.
• QFIN has a Quick Ratio of 2.56. This indicates that QFIN is financially healthy and has no problem in meeting its short term obligations.
• QFIN has a Quick ratio of 2.56. This is in the better half of the industry: QFIN outperforms 73.58% of its industry peers.

Exploring NASDAQ:QFIN's Growth

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:QFIN has achieved a 7 out of 10:

• The Earnings Per Share has grown by an impressive 40.63% over the past year.
• The Revenue has grown by 9.41% in the past year. This is quite good.
• QFIN shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 29.65% yearly.
• QFIN is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 27.08% yearly.
• The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.

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 QFIN

Keep in mind

Important Note: The content of this article is not intended as trading advice. It is essential to perform your own analysis and exercise caution when making trading decisions. The article presents observations created by automated analysis but does not guarantee any trading or investment outcomes. Always trade responsibly and make independent judgments.