Melrose Industries (MRO.L)
Industrials · LSE · UK
Fundamentals
Valuation and ratings
Melrose Industries trades at £4.65, which is 125% below the £10.47 our discounted cash flow model puts on the business. On that measure alone it screens as undervalued, though a DCF is an argument rather than a measurement, and the market is frequently right about why something is cheap.
Our moat model scores it 45 out of 100, which is a moat, but not a deep one. A moat is a structural reason competitors cannot take the profits away, and it matters more to a long holding period than any single quarter's numbers do.
It changes hands at 16.4 times earnings. Be careful reading that in isolation: for a cyclical business a low P/E arrives at the top of the cycle, when profits are peaking and about to fall, which is exactly when the shares look cheapest and are not.
About Melrose Industries
Melrose Industries PLC, together with its subsidiaries, designs and delivers aerospace components and systems for civil and defence markets in the United Kingdom, rest of Europe, North America, and internationally. The company operates through Engines and Airframes segments. The Engines segment offers structural engineered components; parts repair; commercial and aftermarket contracts; engine mount structures; fan cases and turbine cases; and shafts and rotating components to engines original equipment manufacturers. The Airframes segment provides civil and defence air frames, including lightweight composite and metallic structures; electrical distribution systems and components; wing structures; empennage; fuselage; electrical wiring interconnection systems (EWIS); landing gear and ice protection systems; and aircraft transparencies to airframe original equipment manufacturers. The company was formerly known as New Melrose Industries PLC and changed its name to Melrose Industries PLC in November 2015. Melrose Industries PLC was founded in 2003 and is headquartered in London, United Kingdom.
MRO.L passes 4 of our 30 screens today
Each screen prints the exact criteria it used, and the circumstances in which it is wrong.
Common questions
Is Melrose Industries (MRO.L) undervalued?
Against our discounted cash flow estimate of £10.47, MRO.L at £4.65 is 125% below fair value. That is one model's answer, not a recommendation, and most of a DCF's output sits in a terminal value nobody can forecast.
What is MRO.L's P/E ratio?
MRO.L trades at 16.4 times earnings. A low P/E is not automatically cheap: on a cyclical company it is usually a warning that earnings are at a peak.
The full research page for MRO.L, with financial statements, ownership detail, peer comparison and alerts, is free inside the app.
Data from company filings, exchange quotes and SEC EDGAR 13F disclosures. Quotes are delayed. Metrics we do not have are left out rather than estimated. Educational information, not financial advice.