Fresenius Medical Care AG may be undervalued with poor growth indicators, but the 3 analysts following the company give it an rating of underperform. Their target prices range from $11.26 to $31.79 per share, for an average of $22.39. At today's price of $23.26, Fresenius Medical Care AG is trading 3.89% away from its average target price, suggesting there is an analyst consensus of little upside potential for the stock.
Fresenius Medical Care AG & Co. KGaA provides dialysis and related services for individuals with renal diseases in Germany, North America, and internationally. Based in Bad Homburg, Germany, the large-cap Health Care company has 128,044 full time employees. Fresenius Medical Care AG has offered a 5.0% dividend yield over the last 12 months.
Fresenius Medical Care AG has a trailing twelve month P/E ratio of 18.0, compared to an average of 24.45 for the Health Care sector. Based on its EPS guidance of 2.66, the company has a forward P/E ratio of 8.7.
The average compound growth rate of the company's historical and projected earnings per share is 7.7%. On this basis, the company's PEG ratio is 2.05, which suggests that it is overpriced.
On the other hand, the market is potentially undervaluing Fresenius Medical Care AG in terms of its book value because its P/B ratio is 1.0. In comparison, the sector average P/B ratio is 4.16. The company's shares are currently -23.6% below their Graham number, indicating that its shares have a margin of safety.
Why would analysts be giving such an undervalued stock a bad rating? It's possible that analysts are looking beyond common valuation metrics and taking into account the company's potentially irresponsible use of debt to operate its business. They might also believe Fresenius Medical Care AG's negative margin growth trend will continue.
| 2019-12-31 | 2020-12-31 | 2021-12-31 | 2022-12-31 | |
|---|---|---|---|---|
| Revenue (MM) | $17,477 | $17,859 | $17,619 | $19,398 |
| Revenue Growth | n/a | 2.19% | -1.34% | 10.1% |
| Gross Margins | 30.9% | 31.0% | 28.8% | 27.4% |
| Gross Margins Growth | n/a | 0.32% | -7.1% | -4.86% |
| Operating Margins | 12.4% | 12.2% | 10.0% | 6.7% |
| Operating Margins Growth | n/a | -1.61% | -18.03% | -33.0% |
| Net Margins | 6.87% | 6.52% | 5.5% | 3.47% |
| Net Margins Growth | n/a | -5.09% | -15.64% | -36.91% |
| Earnings Per Share | $1.98 | $1.98 | $1.66 | $1.29 |
| EPS Growth | n/a | 0.0% | -16.16% | -22.29% |
| Diluted Shares (MM) | 605 | 588 | 586 | 587 |
| Free Cash Flow (MM) | $329 | $2,145 | $806 | $756 |
| FCF Growth | n/a | 551.98% | -62.42% | -6.2% |
| Capital Expenditures (MM) | -$2,238 | -$2,088 | -$1,683 | -$1,411 |
| Net Debt / EBITDA | 3.5 | 5.08 | 4.45 | 4.59 |
