NYSE:VRT, a growth stock which is not overvalued.

Consider VERTIV HOLDINGS CO-A (NYSE:VRT) as an affordable growth stock, identified by our stock screening tool. NYSE:VRT is showcasing impressive growth figures and is well-positioned in terms of profitability, solvency, and liquidity. Moreover, it seems to be priced reasonably. Let's dive deeper into the analysis.

Looking at the Growth

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. NYSE:VRT boasts a 8 out of 10:

• The Earnings Per Share has grown by an impressive 61.33% over the past year.
• Measured over the past years, VRT shows a very strong growth in Earnings Per Share. The EPS has been growing by 81.80% on average per year.
• Looking at the last year, VRT shows a quite strong growth in Revenue. The Revenue has grown by 13.20% in the last year.
• VRT shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 16.23% yearly.
• The Earnings Per Share is expected to grow by 27.85% on average over the next years. This is a very strong growth
• The Revenue is expected to grow by 12.76% on average over the next years. This is quite good.

Unpacking NYSE:VRT's Valuation Rating

ChartMill assigns a Valuation Rating to each stock, ranging from 0 to 10. This rating is calculated by analyzing different valuation elements, such as price to earnings and free cash flow, both in absolute terms and relative to the market and industry. In the case of NYSE:VRT, the assigned 5 reflects its valuation:

• Based on the Price/Earnings ratio, VRT is valued a bit cheaper than 70.45% of the companies in the same industry.
• Based on the Price/Forward Earnings ratio, VRT is valued a bit cheaper than the industry average as 69.32% of the companies are valued more expensively.
• 68.18% of the companies in the same industry are more expensive than VRT, based on the Enterprise Value to EBITDA ratio.
• Based on the Price/Free Cash Flow ratio, VRT is valued a bit cheaper than 72.73% of the companies in the same industry.
• VRT's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
• VRT has a very decent profitability rating, which may justify a higher PE ratio.
• VRT's earnings are expected to grow with 35.54% in the coming years. This may justify a more expensive valuation.

ChartMill's Evaluation of Health

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. NYSE:VRT has achieved a 5 out of 10:

• An Altman-Z score of 5.26 indicates that VRT is not in any danger for bankruptcy at the moment.
• VRT's Altman-Z score of 5.26 is amongst the best of the industry. VRT outperforms 84.09% of its industry peers.
• VRT has a debt to FCF ratio of 2.72. This is a good value and a sign of high solvency as VRT would need 2.72 years to pay back of all of its debts.
• VRT's Debt to FCF ratio of 2.72 is fine compared to the rest of the industry. VRT outperforms 77.27% of its industry peers.

Analyzing Profitability Metrics

ChartMill assigns a Profitability Rating to every stock. This score ranges from 0 to 10 and evaluates the different profitability ratios and margins, both absolutely, but also relative to the industry peers. NYSE:VRT scores a 7 out of 10:

• VRT has a better Return On Assets (6.54%) than 86.36% of its industry peers.
• With an excellent Return On Equity value of 32.06%, VRT belongs to the best of the industry, outperforming 97.73% of the companies in the same industry.
• VRT's Return On Invested Capital of 14.87% is amongst the best of the industry. VRT outperforms 96.59% of its industry peers.
• The 3 year average ROIC (5.70%) for VRT is below the current ROIC(14.87%), indicating increased profibility in the last year.
• VRT has a better Profit Margin (7.72%) than 82.95% of its industry peers.
• VRT has a better Operating Margin (16.15%) than 90.91% of its industry peers.
• VRT's Operating Margin has improved in the last couple of years.
• The Gross Margin of VRT (36.48%) is better than 82.95% of its industry peers.

More Affordable Growth stocks can be found in our Affordable Growth screener.

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

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.