Avantor Inc (AVTR) receives a strong valuation ranking of 100 from InvestorsObserver's data analysis. The proprietary ranking system focuses on the underlying health of a company through analysis of its stock price, earnings, and growth rate. AVTR has a better value than 100% of stocks based on these valuation analytics. Investors primarily focused on buy-and-hold strategies will find the valuation ranking relevant to their goals when making investment decisions.
Metrics Analysis
AVTR has a trailing twelve month Price to Earnings (PE) ratio of 350.2. The historical average of roughly 15 shows a poor value for AVTR stock as investors are paying higher share prices relative to the company's earnings. AVTR's high trailing PE ratio shows that the firm has been trading above its fair market value recently. Its trailing 12-month earnings per share (EPS) of 0.09 does not justify the stock's current price. However, trailing PE ratios do not factor in the company's projected growth rate, resulting in many newer firms having high PE ratios due to high growth potential enticing investors despite inadequate earnings.
AVTR's 12-month-forward PE to Growth (PEG) ratio of 1 is considered a roughly average value as the market is valuing AVTR right in line with its projected earnings growth. AVTR's PEG comes from its forward price to earnings ratio being divided by its growth rate. A PEG ratio of 1 represents a perfect correlation between earnings growth and share price. Due to their incorporation of more fundamentals of a company's overall health and focusing on the future rather than the past, PEG ratios are one of the most used valuation metrics by analysts today.
Summary
AVTR' has a adequate valuation at its current share price on account of a fairly valued PEG ratio despite strong growth. AVTR's PE and PEG are around the market average leading to a average valuation score.
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