Montrose Environmental Group, Inc.
Montrose Environmental Group, Inc. Fundamental Analysis
Montrose Environmental Group, Inc. (MEG) shows weak financial fundamentals with a PE ratio of 96.76, profit margin of 0.71%, and ROE of 1.26%. The company generates $0.8B in annual revenue with strong year-over-year growth of 19.26%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 51.5/100 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 MEG's fundamental strength across five key dimensions:
Efficiency Score
WeakMEG struggles to generate sufficient returns from assets.
Valuation Score
ModerateMEG shows balanced valuation metrics.
Growth Score
ExcellentMEG delivers strong and consistent growth momentum.
Financial Health Score
ExcellentMEG maintains a strong and stable balance sheet.
Profitability Score
ModerateMEG maintains healthy but balanced margins.
Key Financial Metrics
Is MEG Expensive or Cheap?
P/E Ratio
MEG trades at 96.76 times earnings. This suggests a premium valuation.
PEG Ratio
When adjusting for growth, MEG's PEG of 0.10 indicates potential undervaluation.
Price to Book
The market values Montrose Environmental Group, Inc. at 1.28 times its book value. This may indicate undervaluation.
EV/EBITDA
Enterprise value stands at 7.19 times EBITDA. This is generally considered low.
How Well Does MEG Make Money?
Net Profit Margin
For every $100 in sales, Montrose Environmental Group, Inc. keeps $0.71 as profit after all expenses.
Operating Margin
Core operations generate 2.16 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $1.26 in profit for every $100 of shareholder equity.
ROA
Montrose Environmental Group, Inc. generates $0.61 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Montrose Environmental Group, Inc. produces operating cash flow of $90.65M, showing steady but balanced cash generation.
Free Cash Flow
Montrose Environmental Group, Inc. produces free cash flow of $71.75M, offering steady but limited capital for shareholder returns and expansion.
FCF Per Share
Each share generates $1.98 in free cash annually.
FCF Yield
MEG converts 12.64% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
96.76
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
0.10
vs 25 benchmark
P/B Ratio
Price to book value ratio
1.28
vs 25 benchmark
P/S Ratio
Price to sales ratio
0.69
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
0.18
vs 25 benchmark
Current Ratio
Current assets to current liabilities
1.84
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.01
vs 25 benchmark
ROA
Return on assets percentage
0.006
vs 25 benchmark
ROCE
Return on capital employed
0.02
vs 25 benchmark
How MEG Stacks Against Its Sector Peers
| Metric | MEG Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 96.76 | 26.09 | Worse (Expensive) |
| ROE | 1.26% | 1258.00% | Weak |
| Net Margin | 0.71% | -33493.00% (disorted) | Weak |
| Debt/Equity | 0.18 | 0.73 | Strong (Low Leverage) |
| Current Ratio | 1.84 | 10.37 | Neutral |
| ROA | 0.61% | -1482877.00% (disorted) | Weak |
MEG outperforms its industry in 1 out of 6 key metrics, but lagging in P/E Ratio.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Montrose Environmental Group, Inc.'s 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
18.72%
Industry Style: Cyclical, Value, Infrastructure
High GrowthEPS CAGR
99.32%
Industry Style: Cyclical, Value, Infrastructure
High GrowthFCF CAGR
2625.94%
Industry Style: Cyclical, Value, Infrastructure
High Growth