Investors seeking growth at a reasonable cost should explore QIFU TECHNOLOGY INC (NASDAQ:QFIN).

Here's QIFU TECHNOLOGY INC (NASDAQ:QFIN) for you, a growth stock our stock screener believes is undervalued. QFIN is scoring impressively in terms of growth while demonstrating strong financials. On top of that, it remains attractively priced. Let's break it down further.

A Closer Look at Growth for QFIN

ChartMill assigns a proprietary Growth Rating to each stock. The score is computed by evaluating various growth aspects, like EPS and revenue growth. We take into account the history as well as the estimated future numbers. QFIN was assigned a score of 7 for growth:

• QFIN shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 40.63%, which is quite impressive.
• QFIN shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 9.41%.
• The Revenue has been growing by 29.65% on average over the past years. This is a very strong growth!
• Based on estimates for the next years, QFIN will show a very strong growth in Earnings Per Share. The EPS will grow by 27.08% on average per year.
• The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.

Unpacking QFIN's Valuation Rating

ChartMill employs its own Valuation Rating system for all stocks. This score, ranging from 0 to 10, is determined by evaluating different valuation factors, including price to earnings and free cash flow, both in absolute terms and relative to the market and industry. QFIN has earned a 8 for valuation:

• The Price/Earnings ratio is 8.92, which indicates a very decent valuation of QFIN.
• Compared to the rest of the industry, the Price/Earnings ratio of QFIN indicates a somewhat cheap valuation: QFIN is cheaper than 69.81% of the companies listed in the same industry.
• QFIN is valuated cheaply when we compare the Price/Earnings ratio to 28.62, which is the current average of the S&P500 Index.
• Based on the Price/Forward Earnings ratio of 6.75, the valuation of QFIN can be described as very cheap.
• QFIN's Price/Forward Earnings ratio is rather cheap when compared to the industry. QFIN is cheaper than 84.91% of the companies in the same industry.
• The average S&P500 Price/Forward Earnings ratio is at 21.72. QFIN is valued rather cheaply when compared to this.
• Based on the Enterprise Value to EBITDA ratio, QFIN is valued cheaper than 83.02% of the companies in the same industry.
• The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
• QFIN has an outstanding profitability rating, which 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.

Assessing Health for QFIN

Every stock is evaluated by ChartMill, receiving a Health Rating on a scale of 0 to 10. This assessment considers different health aspects, including liquidity and solvency, both in absolute terms and relative to industry peers. QFIN has achieved a 7 out of 10:

• QFIN has a debt to FCF ratio of 0.12. This is a very positive value and a sign of high solvency as it would only need 0.12 years to pay back of all of its debts.
• Looking at the Debt to FCF ratio, with a value of 0.12, QFIN belongs to the top of the industry, outperforming 92.45% of the companies in the same industry.
• A Debt/Equity ratio of 0.05 indicates that QFIN is not too dependend on debt financing.
• QFIN's Debt to Equity ratio of 0.05 is amongst the best of the industry. QFIN outperforms 86.79% of its industry peers.
• A Current Ratio of 2.56 indicates that QFIN has no problem at all paying its short term obligations.
• The Current ratio of QFIN (2.56) is better than 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.
• The Quick ratio of QFIN (2.56) is better than 73.58% of its industry peers.

Analyzing Profitability Metrics

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. QFIN has earned a 8 out of 10:

• QFIN has a Return On Assets of 11.62%. This is amongst the best in the industry. QFIN outperforms 90.57% of its industry peers.
• With an excellent Return On Equity value of 23.90%, QFIN belongs to the best of the industry, outperforming 83.02% of the companies in the same industry.
• Looking at the Return On Invested Capital, with a value of 18.00%, QFIN belongs to the top of the industry, outperforming 94.34% of the companies in the same industry.
• QFIN had an Average Return On Invested Capital over the past 3 years of 19.66%. This is significantly above the industry average of 8.54%.
• 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.
• With an excellent Operating Margin value of 40.27%, QFIN belongs to the best of the industry, outperforming 98.11% of the companies in the same industry.
• The Gross Margin of QFIN (83.13%) is better than 81.13% of its industry peers.

Our Affordable Growth screener lists more Affordable Growth stocks and is updated daily.

Check the latest full fundamental report of QFIN 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.