We've been asking ourselves recently if the market has placed a fair valuation on CRH. Let's dive into some of the fundamental values of this Large-Cap Industrials company to determine if there might be an opportunity here for value-minded investors.
an Increase in Expected Earnings Improves Its Value Outlook but Priced at a Premium:
CRH plc, together with its subsidiaries, provides building materials solutions in Ireland and internationally. The company belongs to the Industrials sector, which has an average price to earnings (P/E) ratio of 25.19 and an average price to book (P/B) ratio of 3.17. In contrast, CRH has a trailing 12 month P/E ratio of 17.8 and a P/B ratio of 2.81.
CRH's PEG ratio is 1.49, which shows that the stock is probably overvalued in terms of its estimated growth. For reference, a PEG ratio near or below 1 is a potential signal that a company is undervalued.
Stagnant Revenue Growth With No Capital Eexpenditures:
| 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | |
|---|---|---|---|---|---|---|
| Revenue (M) | $27,449 | $28,132 | $25,888 | $29,206 | $32,723 | $28,522 |
| Net Margins | 11% | 6% | 4% | 9% | 12% | 11% |
| Net Income (M) | $2,884 | $1,717 | $1,122 | $2,630 | $3,862 | $3,206 |
| Earnings Per Share | $344.7 | $2.13 | $1.42 | $3.32 | $5.11 | $4.38 |
| EPS Growth | n/a | -99.38% | -33.33% | 133.8% | 53.92% | -14.29% |
| Free Cash Flow (M) | $2,246 | $3,881 | $3,938 | $2,425 | $2,277 | $4,203 |
| Total Debt (M) | $9,959 | $9,211 | $10,958 | $9,938 | $11,033 | $13,401 |
| Current Ratio | 1.29 | 1.34 | 2.01 | 1.85 | 1.84 | 1.69 |
