Fomento Económico Mexicano, S.A.B. de C.V. (FMX)
Valuation Overview•Is Fomento Económico Mexicano, S.A.B. de C.V. Overvalued or Undervalued?
Trading at a discount across both intrinsic cash flow and relative peer multiples, indicating a strong margin of safety.
Moderate quality score of 50/100, reflecting stable operating margins and manageable leverage.
Wall Street forecasts a balanced outlook with consensus price targets near the current price.
Verdict: Average quality business weighed down by significant profitability concerns.
Wall Street sentiment is generally neutral alongside robust expected earnings growth. This outlook is strongly supported by highly attractive capital returns, driven by a balanced mix of reliable dividends and share buybacks.
FMX demonstrates adequate business quality with stable profitability. This is paired with a moderately leveraged but stable balance sheet.
The company is facing top-line contraction (-57.2% 3Y CAGR) however, earnings have severely contracted over the same period. Operating efficiency remains adequate with margins around 8.7%.
| Financial Metric | Trend (12Q) | Latest Qtr | 1Y Growth | 3Y CAGR | 5Y CAGR | 10Y CAGR |
|---|---|---|---|---|---|---|
| Revenue | $11.8B | +24.4% | -57.2% | -37.6% | -17.3% | |
| EBITDA | $1.6B | — | -58.9% | — | — | |
| Net Income | $844.3M | -15.9% | -64.4% | — | -24.4% | |
| EPS (Diluted) | $0.14 | -19.4% | -65.3% | — | -24.7% | |
| Free Cash Flow | $841.5M | +16.6% | -65.8% | -45.3% | — |
| Metric | TTM | 3Y Avg | 5Y Avg | 10Y Avg |
|---|---|---|---|---|
| Gross Margin | 40.7% | 40.5% | 40.6% | 39.0% |
| Operating Margin | 8.7% | 8.6% | 9.4% | 9.3% |
| Net Margin | 3.4% | 5.0% | 4.9% | 4.8% |
| FCF Margin | 23.0% | 2.9% | 5.2% | 5.6% |
| Quarter | EPS Est. | EPS Act. | Surprise | EPS | Rev |
|---|---|---|---|---|---|
| Q2'26Latest | $0.65 | $0.92 | +41.5% | ||
| Q1'26 | $1.50 | $0.92 | -38.7% | ||
| Q4'25 | $1.06 | $0.88 | -17.0% | ||
| Q3'25 | $0.91 | $0.42 | -53.8% | ||
| Q2'25 | $0.52 | $0.45 | -13.5% | ||
| Q1'25 | — | $1.44 | — | ||
| Q1'25 | $1.46 | $0.46 | -68.5% | ||
| Q4'24 | $1.06 | $1.37 | +29.2% |
Total return is +29.3% (1Y), outperforming the benchmark by +8.5%
| Period | Total Return | vs S&P 500 (Alpha) | Dividend Contribution |
|---|---|---|---|
| YTD | +25.8% | +18.4% | — |
| 1Y | +29.3% | +8.5% | +7.8% |
| 3YCAGR | +8.7% | -9.6% | +14.6% |
| 5YCAGR | +10.9% | +0.3% | +22.6% |
| 10YCAGR | +5.4% | -8.5% | — |
The S&P 500 is at 30.6x trailing P/E — Expensive relative to historical averages.
Quick answers to common questions about Fomento Económico Mexicano, S.A.B. de C.V. (FMX) valuation, health, and returns.
Fomento Económico Mexicano, S.A.B. de C.V. is estimated to be undervalued under our discounted cash flow framework. relative multiples indicate the stock is Cheap versus peers compared to industry peers. undervalued (implying +1798.8% upside to DCF intrinsic value of $2446.98)
Fomento Económico Mexicano, S.A.B. de C.V. has multiple valuation anchors: DCF Intrinsic Value: $2446.98 | Peer Relative Fair Value: $159.76 | Wall Street Analyst Target: $132.00 (implying +2.4% upside). A convergence of these signals offers higher conviction.
Fomento Económico Mexicano, S.A.B. de C.V. displays fair financial health with a composite quality score of 50/100, supported by a Altman Z-Score of 2.6 (grey zone), Piotroski F-Score of 6/9, Return on Invested Capital (ROIC) of 11.9%.
Fomento Económico Mexicano, S.A.B. de C.V. pays a 6.4% dividend yield, covered by a 257% payout ratio with 2 years of growth, supplemented by a 1.6% buyback yield.
Fomento Económico Mexicano, S.A.B. de C.V.'s current growth trajectory is Accelerating. The company achieved +24.4% 1Y revenue growth and -19.4% 1Y EPS growth, compared to its 3Y revenue CAGR of -57.2%.
Wall Street consensus is Buy based on 11 analysts, beating EPS expectations in 33% of recent quarters with a 1-quarter streak. The consensus price target represents a +2.4% change from current levels.
Investment risks for Fomento Económico Mexicano, S.A.B. de C.V. include: -21.2% 1-year max drawdown, stretched payout ratio. Volatility risk is characterized by a beta of 0.37x.
No. These computations are purely quantitative model outputs for informational purposes. They do not account for qualitative management shifts or macro events. Always consult a licensed RIA before buying or selling shares.
Disclaimer: This page is for informational purposes only and does not constitute financial advice. All valuation models, scores, and target estimates are automated computations under stated assumptions and should not be relied upon as the sole basis for any investment decision.