Cochlear Limited
Cochlear Limited Fundamental Analysis
Cochlear Limited (CHEOY) shows moderate financial fundamentals with a PE ratio of 37.63, profit margin of 14.63%, and ROE of 17.62%. The company generates $2.3B in annual revenue with moderate year-over-year growth of 4.81%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 63.5/100 based on profitability, valuation, growth, and balance sheet metrics. The C+ grade reflects average fundamentals, with notable risks in certain areas.
Fundamental Health Score
We analyze CHEOY's fundamental strength across five key dimensions:
Efficiency Score
ExcellentCHEOY demonstrates superior asset utilization.
Valuation Score
ModerateCHEOY shows balanced valuation metrics.
Growth Score
WeakCHEOY faces weak or negative growth trends.
Financial Health Score
ExcellentCHEOY maintains a strong and stable balance sheet.
Profitability Score
ModerateCHEOY maintains healthy but balanced margins.
Key Financial Metrics
Is CHEOY Expensive or Cheap?
P/E Ratio
CHEOY trades at 37.63 times earnings. This suggests a premium valuation.
PEG Ratio
When adjusting for growth, CHEOY's PEG of -2.28 indicates potential undervaluation.
Price to Book
The market values Cochlear Limited at 6.65 times its book value. This suggests the stock is fully valued or overvalued on an asset basis.
EV/EBITDA
Enterprise value stands at 22.50 times EBITDA. This signals the market has high growth expectations.
How Well Does CHEOY Make Money?
Net Profit Margin
For every $100 in sales, Cochlear Limited keeps $14.63 as profit after all expenses.
Operating Margin
Core operations generate 20.00 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $17.62 in profit for every $100 of shareholder equity.
ROA
Cochlear Limited generates $12.27 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Cochlear Limited produces operating cash flow of $262.00M, showing steady but balanced cash generation.
Free Cash Flow
Cochlear Limited produces free cash flow of $199.21M, offering steady but limited capital for shareholder returns and expansion.
FCF Per Share
Each share generates $1.52 in free cash annually.
FCF Yield
CHEOY converts 1.54% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
37.63
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
-2.28
vs 25 benchmark
P/B Ratio
Price to book value ratio
6.65
vs 25 benchmark
P/S Ratio
Price to sales ratio
5.51
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
0.22
vs 25 benchmark
Current Ratio
Current assets to current liabilities
2.46
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.18
vs 25 benchmark
ROA
Return on assets percentage
0.12
vs 25 benchmark
ROCE
Return on capital employed
0.21
vs 25 benchmark
How CHEOY Stacks Against Its Sector Peers
| Metric | CHEOY Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 37.63 | 29.45 | Worse (Expensive) |
| ROE | 17.62% | 779.00% | Weak |
| Net Margin | 14.63% | -24930.00% (disorted) | Strong |
| Debt/Equity | 0.22 | 0.26 | Neutral |
| Current Ratio | 2.46 | 4.65 | Strong Liquidity |
| ROA | 12.27% | -19333.00% (disorted) | Strong |
CHEOY outperforms its industry in 3 out of 6 key metrics, particularly excelling in Net Margin, but lagging in P/E Ratio.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Cochlear Limited's 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
52.75%
Industry Style: Defensive, Growth, Innovation
High GrowthEPS CAGR
243.87%
Industry Style: Defensive, Growth, Innovation
High GrowthFCF CAGR
232.74%
Industry Style: Defensive, Growth, Innovation
High Growth