Avantor, Inc. Fundamental Analysis (NYSE: AVTR)
Avantor, Inc. (NYSE: AVTR) shows weak financial fundamentals with a PE ratio of 31.22, profit margin of 5.08%, and ROE of 5.96%. The company generates $6.6B in annual revenue with weak year-over-year growth of -3.41%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 30.5/100 based on profitability, valuation, growth, and balance sheet metrics. The F grade reflects weak fundamentals and significant financial concerns.
Fundamental Health Score
We analyze AVTR's fundamental strength across five key dimensions:
Efficiency Score
WeakAVTR struggles to generate sufficient returns from assets.
Valuation Score
ModerateAVTR shows balanced valuation metrics.
Growth Score
WeakAVTR faces weak or negative growth trends.
Financial Health Score
ExcellentAVTR maintains a strong and stable balance sheet.
Profitability Score
WeakAVTR struggles to sustain strong margins.
Key Financial Metrics
Is AVTR Expensive or Cheap?
P/E Ratio
AVTR trades at 31.22 times earnings. This suggests a premium valuation.
PEG Ratio
When adjusting for growth, AVTR's PEG of -0.02 indicates potential undervaluation.
Price to Book
The market values Avantor, Inc. at 1.82 times its book value. This may indicate undervaluation.
EV/EBITDA
Enterprise value stands at 8.12 times EBITDA. This is generally considered low.
How Well Does AVTR Make Money?
Net Profit Margin
For every $100 in sales, Avantor, Inc. keeps $5.08 as profit after all expenses.
Operating Margin
Core operations generate 7.58 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $5.96 in profit for every $100 of shareholder equity.
ROA
Avantor, Inc. generates $2.90 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Avantor, Inc. generates limited operating cash flow of $585.15M, signaling weaker underlying cash strength.
Free Cash Flow
Avantor, Inc. produces free cash flow of $439.53M, offering steady but limited capital for shareholder returns and expansion.
FCF Per Share
Each share generates $0.65 in free cash annually.
FCF Yield
AVTR converts 4.15% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
31.22
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
-0.02
vs 25 benchmark
P/B Ratio
Price to book value ratio
1.82
vs 25 benchmark
P/S Ratio
Price to sales ratio
1.60
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
0.63
vs 25 benchmark
Current Ratio
Current assets to current liabilities
1.89
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.06
vs 25 benchmark
ROA
Return on assets percentage
0.03
vs 25 benchmark
ROCE
Return on capital employed
0.05
vs 25 benchmark
How AVTR Stacks Against Its Sector Peers
| Metric | AVTR Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 31.22 | 31.30 | Neutral |
| ROE | 5.96% | 487.00% | Weak |
| Net Margin | 5.08% | -1832.00% (disorted) | Weak |
| Debt/Equity | 0.63 | 0.10 | Weak (High Leverage) |
| Current Ratio | 1.89 | 5.74 | Neutral |
| ROA | 2.90% | -165.00% (disorted) | Weak |
AVTR outperforms its industry in 0 out of 6 key metrics, but lagging in ROE.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Avantor, Inc.'s 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
-12.89%
Industry Style: Defensive, Growth, Innovation
DecliningEPS CAGR
-486.51%
Industry Style: Defensive, Growth, Innovation
DecliningFCF CAGR
-42.97%
Industry Style: Defensive, Growth, Innovation
Declining