New position (unfortunately with spread)
Diversified Chinese sports textile manufacturer, Fila brand should be well known. Strong growth, strong profitability, margins in line with the industry. Strongly undervalued in my opinion.
Briefly the key figures from my last strategy presentation:
Margins:
- Gross Margin 10Y AVG: 51.01% ⚠️
- Operating Margin 5Y CAGR: -2.6% ⛔️
- FCF Margin: 18.59% ✅️
Profitability:
- Debt / Ebitda: 1.62 ✅️
- ROIC 5Y AVG - WACC 5Y AVG: 21.92% ✅️
- ROA 10Y AVG: 15.93% ✅️
- ROCE 5Y AVG: 30.03% ✅️
Growth:
- Revenue 10Y CAGR: 21.53% ✅️
- EPS 5Y CAGR: 18.75% ✅️
- FCF 5Y CAGR: 32% ✅️
- Dividend 5Y CAGR: 8.55% ✅️
Part of Part 2 of the strategy:
Morningstar MOAT: Narrow 👍
Morningstar ESG: 4/5👍
GF Profitability Rank: 10/10 ✅️
FCF/Share 5Y CAGR: 24.08% ✅️
EVALUATION: (comes in detail in part 3 of my strategy presentation).
FCF Yield 4.88% > 5Y AVG 3.38% ✅️
FCF Yield > 10Y Treasury and S&P500 Earnings Yield ✅️
SMA200 Distance: -15.79% ✅️
Gurufocus Fair Value Distance -37% significantly undervalued ✅️
Morningstar Fair Value Distance -30% Significantly undervalued ✅️
Past FCF CAGR vs. future market implied cagr: difference 37.28% (own model) ✅️
