Afya Limited
Afya Limited Fundamental Analysis
Afya Limited (AFYA) shows strong financial fundamentals with a PE ratio of 9.09, profit margin of 20.08%, and ROE of 16.20%. The company generates $3.6B in annual revenue with strong year-over-year growth of 14.90%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 79.7/100 based on profitability, valuation, growth, and balance sheet metrics. The B grade reflects solid fundamentals with room for improvement in valuation or growth.
Fundamental Health Score
We analyze AFYA's fundamental strength across five key dimensions:
Efficiency Score
WeakAFYA struggles to generate sufficient returns from assets.
Valuation Score
ExcellentAFYA trades at attractive valuation levels.
Growth Score
ExcellentAFYA delivers strong and consistent growth momentum.
Financial Health Score
ModerateAFYA shows balanced financial health with some risks.
Profitability Score
ExcellentAFYA achieves industry-leading margins.
Key Financial Metrics
Is AFYA Expensive or Cheap?
P/E Ratio
AFYA trades at 9.09 times earnings. This suggests potential undervaluation.
PEG Ratio
When adjusting for growth, AFYA's PEG of 0.35 indicates potential undervaluation.
Price to Book
The market values Afya Limited at 1.40 times its book value. This may indicate undervaluation.
EV/EBITDA
Enterprise value stands at 2.88 times EBITDA. This is generally considered low.
How Well Does AFYA Make Money?
Net Profit Margin
For every $100 in sales, Afya Limited keeps $20.08 as profit after all expenses.
Operating Margin
Core operations generate 32.84 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $16.20 in profit for every $100 of shareholder equity.
ROA
Afya Limited generates $7.94 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Afya Limited generates strong operating cash flow of $1.56B, reflecting robust business health.
Free Cash Flow
Afya Limited generates strong free cash flow of $1.25B, providing ample flexibility for dividends, buybacks, or growth.
FCF Per Share
Each share generates $13.83 in free cash annually.
FCF Yield
AFYA converts 19.13% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
9.09
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
0.35
vs 25 benchmark
P/B Ratio
Price to book value ratio
1.40
vs 25 benchmark
P/S Ratio
Price to sales ratio
1.82
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
0.63
vs 25 benchmark
Current Ratio
Current assets to current liabilities
0.98
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.16
vs 25 benchmark
ROA
Return on assets percentage
0.08
vs 25 benchmark
ROCE
Return on capital employed
0.16
vs 25 benchmark
How AFYA Stacks Against Its Sector Peers
| Metric | AFYA Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 9.09 | 23.25 | Better (Cheaper) |
| ROE | 16.20% | 1240.00% | Weak |
| Net Margin | 20.08% | -9728.00% (disorted) | Strong |
| Debt/Equity | 0.63 | 0.77 | Neutral |
| Current Ratio | 0.98 | 2.54 | Weak Liquidity |
| ROA | 7.94% | -203388.00% (disorted) | Weak |
AFYA outperforms its industry in 2 out of 6 key metrics, particularly excelling in Net Margin, but lagging in ROE.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Afya Limited's 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
271.08%
Industry Style: Defensive, Dividend, Low Volatility
High GrowthEPS CAGR
245.86%
Industry Style: Defensive, Dividend, Low Volatility
High GrowthFCF CAGR
303.61%
Industry Style: Defensive, Dividend, Low Volatility
High Growth