Fabrinet
Fabrinet Fundamental Analysis
Fabrinet (FN) shows moderate financial fundamentals with a PE ratio of 51.74, profit margin of 9.61%, and ROE of 18.39%. The company generates $3.9B in annual revenue with strong year-over-year growth of 18.60%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 78.4/100 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 FN's fundamental strength across five key dimensions:
Efficiency Score
ExcellentFN demonstrates superior asset utilization.
Valuation Score
WeakFN trades at a premium to fair value.
Growth Score
ExcellentFN delivers strong and consistent growth momentum.
Financial Health Score
ExcellentFN maintains a strong and stable balance sheet.
Profitability Score
ModerateFN maintains healthy but balanced margins.
Key Financial Metrics
Is FN Expensive or Cheap?
P/E Ratio
FN trades at 51.74 times earnings. This suggests a premium valuation.
PEG Ratio
When adjusting for growth, FN's PEG of 6.75 indicates potential overvaluation.
Price to Book
The market values Fabrinet at 8.86 times its book value. This suggests the stock is fully valued or overvalued on an asset basis.
EV/EBITDA
Enterprise value stands at 42.97 times EBITDA. This signals the market has high growth expectations.
How Well Does FN Make Money?
Net Profit Margin
For every $100 in sales, Fabrinet keeps $9.61 as profit after all expenses.
Operating Margin
Core operations generate 9.67 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $18.39 in profit for every $100 of shareholder equity.
ROA
Fabrinet generates $11.44 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Fabrinet generates limited operating cash flow of $278.32M, signaling weaker underlying cash strength.
Free Cash Flow
Fabrinet generates weak or negative free cash flow of $101.87M, restricting financial flexibility.
FCF Per Share
Each share generates $2.84 in free cash annually.
FCF Yield
FN converts 0.52% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
51.74
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
6.75
vs 25 benchmark
P/B Ratio
Price to book value ratio
8.86
vs 25 benchmark
P/S Ratio
Price to sales ratio
4.98
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
0.004
vs 25 benchmark
Current Ratio
Current assets to current liabilities
2.68
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.18
vs 25 benchmark
ROA
Return on assets percentage
0.11
vs 25 benchmark
ROCE
Return on capital employed
0.17
vs 25 benchmark
How FN Stacks Against Its Sector Peers
| Metric | FN Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 51.74 | 35.19 | Worse (Expensive) |
| ROE | 18.39% | 1155.00% | Weak |
| Net Margin | 9.61% | -127067.00% (disorted) | Weak |
| Debt/Equity | 0.00 | 0.41 | Strong (Low Leverage) |
| Current Ratio | 2.68 | 4.71 | Strong Liquidity |
| ROA | 11.44% | -314918.00% (disorted) | Strong |
FN outperforms its industry in 3 out of 6 key metrics, particularly excelling in ROA, but lagging in P/E Ratio.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Fabrinet's 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
113.41%
Industry Style: Growth, Innovation, High Beta
High GrowthEPS CAGR
200.28%
Industry Style: Growth, Innovation, High Beta
High GrowthFCF CAGR
123.34%
Industry Style: Growth, Innovation, High Beta
High Growth