Fabrinet Stock Fair Value Calculation – Fabrinet’s 10-Year Performance Surpasses Market Expectations, Producing 30.57% Annual Return on $100 Investment
October 25, 2024
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Fabrinet ($NYSE:FN) is a leading provider of advanced optical packaging and precision optical, electro-mechanical, and electronic manufacturing services to original equipment manufacturers (OEMs) in the communications, industrial, and automotive industries. Over the past decade, Fabrinet’s stock (FN) has consistently outperformed the market, producing an impressive annualized growth rate of 19.25%. This means that if you had invested $100 in Fabrinet 10 years ago, that investment would now be worth significantly more. In fact, the average annual return on a $100 investment in Fabrinet over the past 10 years is an impressive 30.57%. One of the key reasons for Fabrinet’s success is its strong financial performance.
In addition, Fabrinet has maintained a healthy balance sheet with low debt levels and strong cash flow. This has allowed the company to invest in its operations, expand its capabilities, and pursue growth opportunities. Fabrinet’s success can also be attributed to its focus on diversification. The company serves a wide range of industries, including telecommunications, data storage, industrial and commercial lasers, automotive, and aerospace. This diversification has helped Fabrinet mitigate risks associated with fluctuations in specific industries and has allowed it to capitalize on growth opportunities in emerging markets. Furthermore, Fabrinet’s commitment to innovation and technology has been a key driver of its success. The company invests heavily in research and development, constantly seeking new and better ways to serve its customers. This has allowed Fabrinet to stay ahead of the curve and adapt to changes in the industry, ensuring its continued growth and success. In conclusion, Fabrinet’s 10-year performance has surpassed market expectations, solidifying its position as a leader in the industry. The company’s consistent growth, strong financial performance, diversification, and focus on innovation have all contributed to its success. As Fabrinet continues to expand its capabilities and reach, it is poised for even greater growth and success in the future.
Analysis – Fabrinet Stock Fair Value Calculation
After conducting a thorough analysis, I have determined that FABRINET is currently in a good financial position. Their financial health appears to be stable, with a well-managed balance sheet and positive cash flow. Based on our proprietary Valuation Line, the fair value of FABRINET’s stock is estimated to be around $136.2. This calculation takes into account various financial indicators, such as earnings, cash flow, and potential growth. However, it is worth noting that FABRINET’s current stock price is significantly higher at $245.52. In fact, our analysis suggests that the stock is currently overvalued by 80.3%. This could indicate that investors are overly optimistic about the company’s future performance and may be ignoring potential risks. In conclusion, while FABRINET appears to be in a good financial position, it is important for investors to carefully consider the current valuation of the stock before making any investment decisions. It is always important to conduct thorough research and analysis before investing in any company. Fabrinets_10-Year_Performance_Surpasses_Market_Expectations_Producing_30.57_Annual_Return_on_100_Investment”>More…
About the Company
Income Snapshot
Below shows the total revenue, net income and net margin for Fabrinet. More…
| Total Revenues | Net Income | Net Margin |
| 2.72k | 254.34 | 9.7% |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for Fabrinet. More…
| Operations | Investing | Financing |
| 337.42 | -178.99 | -74.76 |
Balance Sheet Snapshot
Below shows the total assets, liabilities and book value per share for Fabrinet. More…
| Total Assets | Total Liabilities | Book Value Per Share |
| 2.13k | 521.76 | 44.39 |
Key Ratios Snapshot
Some of the financial key ratios for Fabrinet are shown below. More…
| 3Y Rev Growth | 3Y Operating Profit Growth | Operating Margin |
| 16.8% | 28.1% | 10.1% |
| FCF Margin | ROE | ROA |
| 10.2% | 10.9% | 8.0% |
Peers
The company services a diverse set of markets, including telecommunications, data communications, aerospace and defense, industrial, life sciences, medical devices, and consumer electronics. Fabrinet has a strong competitive position in its markets, with a comprehensive suite of capabilities and a global footprint. The company’s competitors include Castech Inc, TT Electronics PLC, Gooch & Housego PLC, and others.
– Castech Inc ($SZSE:002222)
Castech Inc is a leading manufacturer of semiconductor products and services. The company has a market cap of 6.84B as of 2022 and a return on equity of 12.34%. The company’s products and services are used in a variety of electronic devices and systems, including computers, cell phones, and automotive electronics.
– TT Electronics PLC ($LSE:TTG)
TT Electronics is a provider of advanced electronics solutions for global markets. The company designs and manufactures electronic components, systems and services for applications in the aerospace, defence, rail, oil and gas, marine, medical, power generation and distribution, and industrial markets.
TT Electronics has a market capitalisation of £232.53 million as of March 2022 and a return on equity of 3.65%. The company designs and manufactures electronic components, systems and services for applications in the aerospace, defence, rail, oil and gas, marine, medical, power generation and distribution, and industrial markets.
– Gooch & Housego PLC ($LSE:GHH)
Gooch & Housego PLC is a leading global provider of advanced photonics solutions. They design, manufacture and supply a wide range of optical components, systems and instrumentation to meet the needs of their customers worldwide. Gooch & Housego has a market cap of 118.69M as of 2022 and a return on equity of 3.16%. The company has a strong focus on innovative photonics solutions and providing excellent customer service.
Summary
Fabrinet (FN) has been a strong performer in the market over the past 10 years. If an investor had put $100 into FN 10 years ago, it would have grown significantly, outperforming the overall market by 19.25% on an annualized basis. This translates to an average annual return of 30.57%. This shows that FN has been consistently delivering strong returns for its investors.
It is a company worth considering for investment, given its track record of outperforming the market. Investors may want to further analyze FN’s financials and potential for future growth before making a decision to invest.
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