Fastenal demonstrates strong business quality through its effective business model, robust cash flow generation, and a concentrated customer base. However, challenges in lower-tier customer segments and margin pressures could affect growth. On the future prospects front, growth in e-commerce and technology, along with improving market sentiment, present opportunities, though economic uncertainties and dependency on key accounts pose risks.
Analysis Date: January 17, 2025
Last Updated: March 12, 2025
Trailing Twelve Months (TTM) values provide a view of the company's performance over the last year.
Graham Value Metrics
Benjamin Graham's value investing approach focuses on finding stocks with a significant margin of safety between their intrinsic value and market price.
Intrinsic Value
Estimated fair value based on Graham's formula
$47.04
Current Market Price: $74.45
IV/P Ratio: 0.63x (>1.0 indicates undervalued)
Margin of Safety
Gap between intrinsic value and market price
-57.99999999999999%
Graham recommended a minimum of 20-30% margin of safety
Higher values indicate a greater potential discount to fair value
ROE: 32.55225094599851
ROA: 5.578969774372073
Gross Profit Margin: 44.006095944871454
Net Profit Margin: 15.247813411078717
Trailing Twelve Months (TTM) values provide a view of the company's performance over the last year.
Healthy Profit Margins
44.01%
Gross Profit Margin
The gross profit margin is 44.01%, indicating a strong ability to generate profit from sales. The net profit margin of 15.25% reflects solid profitability after all expenses.
High Price-to-Cash-Flow Ratio
The price-to-free-cash-flow (P/FCF) ratio is 44.86, suggesting that the stock might be expensive relative to its cash generation capabilities.
About Profitability Metrics
Profitability metrics measure a company's ability to generate earnings relative to its revenue, operating costs, and other relevant metrics. Higher values generally indicate better performance.
Return on Equity (ROE)
Measures how efficiently a company uses its equity to generate profits
32.55%
10%
15%
Higher values indicate better returns for shareholders
TTM (as of 2025-04-16)
Return on Assets (ROA)
Measures how efficiently a company uses its assets to generate profits
5.58%
3%
7%
Higher values indicate better asset utilization
TTM (as of 2025-04-16)
Gross Profit Margin
Percentage of revenue retained after accounting for cost of goods sold
44.01%
20%
40%
Higher values indicate better efficiency in production
TTM (as of 2025-04-16)
Net Profit Margin
Percentage of revenue retained after accounting for all expenses
15.25%
8%
15%
Higher values indicate better overall profitability
TTM (as of 2025-04-16)
Strong Liquidity Ratios
The current ratio of 4.67 and quick ratio of 2.28 indicate a strong ability to cover short-term liabilities with current assets.
Low Debt Levels
0.13
Debt-to-Equity Ratio
The debt-to-equity ratio of 0.13 shows that the company is conservatively leveraged, suggesting lower financial risk.
Moderate Cash Position
The cash ratio of 0.37 indicates that while the company has good liquidity, its cash reserves are not excessively high compared to current liabilities.
About Financial Health Metrics
Financial health metrics assess a company's ability to meet its financial obligations and its overall financial stability.
Debt to Equity Ratio
Total debt divided by total equity
0.13x
1.0x
2.0x
Lower values indicate less financial leverage and risk
Less than 1.0 is conservative, 1.0-2.0 is moderate, >2.0 indicates high risk
Q4 2024
Current Ratio
Current assets divided by current liabilities
4.67x
1.0x
2.0x
Higher values indicate better short-term liquidity
Less than 1.0 is concerning, 1.0-2.0 is adequate, greater than 2.0 is good
Q4 2024
