Fortescue Metals Group Limited
Fortescue Metals Group Limited Fundamental Analysis
Fortescue Metals Group Limited (FSUMF) shows moderate financial fundamentals with a PE ratio of 13.12, profit margin of 21.10%, and ROE of 17.05%. The company generates $15.8B in annual revenue with weak year-over-year growth of -14.85%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 46.1/100 based on profitability, valuation, growth, and balance sheet metrics. The D grade reflects weak fundamentals and significant financial concerns.
Fundamental Health Score
We analyze FSUMF's fundamental strength across five key dimensions:
Efficiency Score
ExcellentFSUMF demonstrates superior asset utilization.
Valuation Score
ExcellentFSUMF trades at attractive valuation levels.
Growth Score
WeakFSUMF faces weak or negative growth trends.
Financial Health Score
ExcellentFSUMF maintains a strong and stable balance sheet.
Profitability Score
ExcellentFSUMF achieves industry-leading margins.
Key Financial Metrics
Is FSUMF Expensive or Cheap?
P/E Ratio
FSUMF trades at 13.12 times earnings. This suggests potential undervaluation.
PEG Ratio
When adjusting for growth, FSUMF's PEG of -1.08 indicates potential undervaluation.
Price to Book
The market values Fortescue Metals Group Limited at 2.19 times its book value. This may indicate undervaluation.
EV/EBITDA
Enterprise value stands at 5.47 times EBITDA. This is generally considered low.
How Well Does FSUMF Make Money?
Net Profit Margin
For every $100 in sales, Fortescue Metals Group Limited keeps $21.10 as profit after all expenses.
Operating Margin
Core operations generate 32.03 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $17.05 in profit for every $100 of shareholder equity.
ROA
Fortescue Metals Group Limited generates $10.95 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Fortescue Metals Group Limited generates strong operating cash flow of $6.53B, reflecting robust business health.
Free Cash Flow
Fortescue Metals Group Limited generates strong free cash flow of $3.24B, providing ample flexibility for dividends, buybacks, or growth.
FCF Per Share
Each share generates $1.05 in free cash annually.
FCF Yield
FSUMF converts 7.40% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
13.12
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
-1.08
vs 25 benchmark
P/B Ratio
Price to book value ratio
2.19
vs 25 benchmark
P/S Ratio
Price to sales ratio
2.77
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
0.27
vs 25 benchmark
Current Ratio
Current assets to current liabilities
2.43
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.17
vs 25 benchmark
ROA
Return on assets percentage
0.11
vs 25 benchmark
ROCE
Return on capital employed
0.18
vs 25 benchmark
How FSUMF Stacks Against Its Sector Peers
| Metric | FSUMF Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 13.12 | 27.01 | Better (Cheaper) |
| ROE | 17.05% | 949.00% | Weak |
| Net Margin | 21.10% | -16159.00% (disorted) | Strong |
| Debt/Equity | 0.27 | 0.48 | Strong (Low Leverage) |
| Current Ratio | 2.43 | 4.42 | Strong Liquidity |
| ROA | 10.95% | -6411.00% (disorted) | Strong |
FSUMF outperforms its industry in 5 out of 6 key metrics, particularly excelling in Net Margin, but lagging in ROE.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Fortescue Metals Group Limited's 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
20.78%
Industry Style: Cyclical, Commodity, Value
High GrowthEPS CAGR
-28.71%
Industry Style: Cyclical, Commodity, Value
DecliningFCF CAGR
-1.79%
Industry Style: Cyclical, Commodity, Value
Declining