Standard Motor Products, Inc. Fundamental Analysis (NYSE: SMP)
Standard Motor Products, Inc. (NYSE: SMP) shows moderate financial fundamentals with a PE ratio of 16.91, profit margin of 2.78%, and ROE of 7.36%. The company generates $1.8B in annual revenue with strong year-over-year growth of 22.36%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 55.9/100 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 SMP's fundamental strength across five key dimensions:
Efficiency Score
WeakSMP struggles to generate sufficient returns from assets.
Valuation Score
ExcellentSMP trades at attractive valuation levels.
Growth Score
ModerateSMP shows steady but slowing expansion.
Financial Health Score
ExcellentSMP maintains a strong and stable balance sheet.
Profitability Score
WeakSMP struggles to sustain strong margins.
Key Financial Metrics
Is SMP Expensive or Cheap?
P/E Ratio
SMP trades at 16.91 times earnings. This indicates a fair valuation.
PEG Ratio
When adjusting for growth, SMP's PEG of -0.79 indicates potential undervaluation.
Price to Book
The market values Standard Motor Products, Inc. at 1.20 times its book value. This may indicate undervaluation.
EV/EBITDA
Enterprise value stands at 1.39 times EBITDA. This is generally considered low.
How Well Does SMP Make Money?
Net Profit Margin
For every $100 in sales, Standard Motor Products, Inc. keeps $2.78 as profit after all expenses.
Operating Margin
Core operations generate 9.76 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $7.36 in profit for every $100 of shareholder equity.
ROA
Standard Motor Products, Inc. generates $2.48 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Standard Motor Products, Inc. generates limited operating cash flow of $121.79M, signaling weaker underlying cash strength.
Free Cash Flow
Standard Motor Products, Inc. produces free cash flow of $87.36M, offering steady but limited capital for shareholder returns and expansion.
FCF Per Share
Each share generates $3.92 in free cash annually.
FCF Yield
SMP converts 10.12% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
16.91
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
-0.79
vs 25 benchmark
P/B Ratio
Price to book value ratio
1.20
vs 25 benchmark
P/S Ratio
Price to sales ratio
0.47
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
0.94
vs 25 benchmark
Current Ratio
Current assets to current liabilities
2.003
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.07
vs 25 benchmark
ROA
Return on assets percentage
0.02
vs 25 benchmark
ROCE
Return on capital employed
0.12
vs 25 benchmark
How SMP Stacks Against Its Sector Peers
| Metric | SMP Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 16.91 | 26.29 | Better (Cheaper) |
| ROE | 7.36% | 966.00% | Weak |
| Net Margin | 2.78% | -4927.00% (disorted) | Weak |
| Debt/Equity | 0.94 | 0.60 | Weak (High Leverage) |
| Current Ratio | 2.00 | 2.32 | Strong Liquidity |
| ROA | 2.48% | 295.00% | Weak |
SMP outperforms its industry in 2 out of 6 key metrics, but lagging in ROE.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Standard Motor Products, Inc.'s 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
61.51%
Industry Style: Cyclical, Growth, Discretionary
High GrowthEPS CAGR
-26.71%
Industry Style: Cyclical, Growth, Discretionary
DecliningFCF CAGR
-40.29%
Industry Style: Cyclical, Growth, Discretionary
Declining