Don't overlook YETI HOLDINGS INC (NYSE:YETI)—it's a hidden gem with strong fundamentals and an attractive price tag.

YETI HOLDINGS INC (NYSE:YETI) was identified as a decent value stock by our stock screener. YETI scores well on profitability, solvency and liquidity. At the same time it seems to be priced very reasonably. We'll explore this a bit deeper below.

Deciphering YETI's Valuation Rating

ChartMill assigns a Valuation Rating to every stock. This score ranges from 0 to 10 and evaluates the different valuation aspects and compares the price to earnings and cash flows, while taking into account profitability and growth. YETI scores a 7 out of 10:

• 86.21% of the companies in the same industry are more expensive than YETI, based on the Price/Earnings ratio.
• When comparing the Price/Earnings ratio of YETI to the average of the S&P500 Index (29.51), we can say YETI is valued rather cheaply.
• With a Price/Forward Earnings ratio of 11.11, the valuation of YETI can be described as very reasonable.
• YETI's Price/Forward Earnings ratio is rather cheap when compared to the industry. YETI is cheaper than 86.21% of the companies in the same industry.
• When comparing the Price/Forward Earnings ratio of YETI to the average of the S&P500 Index (22.30), we can say YETI is valued rather cheaply.
• Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of YETI indicates a somewhat cheap valuation: YETI is cheaper than 75.86% of the companies listed in the same industry.
• Based on the Price/Free Cash Flow ratio, YETI is valued a bit cheaper than 79.31% of the companies in the same industry.
• YETI has an outstanding profitability rating, which may justify a higher PE ratio.

Analyzing Profitability Metrics

ChartMill employs its own Profitability Rating system for stock evaluation. This score, ranging from 0 to 10, is derived from an analysis of diverse profitability metrics and margins. In the case of YETI, the assigned 10 is noteworthy for profitability:

• The Return On Assets of YETI (13.66%) is better than 100.00% of its industry peers.
• YETI has a Return On Equity of 23.74%. This is amongst the best in the industry. YETI outperforms 89.66% of its industry peers.
• YETI's Return On Invested Capital of 20.67% is amongst the best of the industry. YETI outperforms 100.00% of its industry peers.
• Measured over the past 3 years, the Average Return On Invested Capital for YETI is significantly above the industry average of 8.15%.
• The last Return On Invested Capital (20.67%) for YETI is above the 3 year average (18.12%), which is a sign of increasing profitability.
• Looking at the Profit Margin, with a value of 9.60%, YETI belongs to the top of the industry, outperforming 96.55% of the companies in the same industry.
• YETI's Profit Margin has improved in the last couple of years.
• YETI's Operating Margin of 13.60% is amongst the best of the industry. YETI outperforms 93.10% of its industry peers.
• YETI's Operating Margin has improved in the last couple of years.
• YETI has a better Gross Margin (58.11%) than 93.10% of its industry peers.
• YETI's Gross Margin has improved in the last couple of years.

Analyzing Health Metrics

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. YETI has received a 8 out of 10:

• YETI has an Altman-Z score of 6.14. This indicates that YETI is financially healthy and has little risk of bankruptcy at the moment.
• Looking at the Altman-Z score, with a value of 6.14, YETI belongs to the top of the industry, outperforming 89.66% of the companies in the same industry.
• The Debt to FCF ratio of YETI is 0.36, which is an excellent value as it means it would take YETI, only 0.36 years of fcf income to pay off all of its debts.
• YETI has a Debt to FCF ratio of 0.36. This is amongst the best in the industry. YETI outperforms 82.76% of its industry peers.
• A Debt/Equity ratio of 0.10 indicates that YETI is not too dependend on debt financing.
• A Current Ratio of 2.18 indicates that YETI has no problem at all paying its short term obligations.

Exploring YETI's Growth

ChartMill employs its own Growth Rating system for all stocks. This score, ranging from 0 to 10, is derived by evaluating different growth factors, such as EPS and revenue growth, taking into account both past performance and future projections. YETI has earned a 5 for growth:

• The Earnings Per Share has grown by an impressive 22.22% over the past year.
• The Earnings Per Share has been growing by 18.24% on average over the past years. This is quite good.
• Looking at the last year, YETI shows a quite strong growth in Revenue. The Revenue has grown by 10.31% in the last year.
• The Revenue has been growing by 14.90% on average over the past years. This is quite good.
• The Earnings Per Share is expected to grow by 8.24% on average over the next years. This is quite good.

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

Check the latest full fundamental report of YETI 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.