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Verdict
Quantitative factor alignment verified for current market regime.
Quant Score
Rank
#3042
Positioning
Market Dominance
Retail Trade
Retail
$8.3B
Thomas V. Taylor
Floor & Decor Holdings, Inc. operates as a multi-channel specialty retailer and commercial flooring distributor. The company's stores offer tile, wood, laminate, vinyl, and natural stone flooring products. As of December 30, 2021, the company operated 160 warehouse stores and two design studios in 33 states.
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X-AXIS: EV/EBITDA (LOWER = CHEAPER) | Y-AXIS: ROE (HIGHER = ELITE) | RED CIRCLE = FND ANALYSIS TARGET
| Stock | Rating | Score▼ | Quality | Value | Momentum | P/E | EV/EBITDA | ROE | ROA | Gross Mgn | Op Mgn | Net Mgn | Rev Growth | Div Yield | D/E | Mkt Cap | AUDIT |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
$ARCO Arcos Dorados Holdings Inc. | 73 | 85 | 89 | 65 | - | - | - | - | - | - | - | - | - | - | $0 | VS | |
$IMKTA INGLES MARKETS INC | 70 | 73 | 89 | 76 | 11.3x | 4.1x | 6.9% | 4.1% | 24.3% | 2.8% | 1.9% | -3.4% | 1.1% | 33.0x | $1.2B | VS | |
$SGU STAR GROUP, L.P. | 69 | 82 | 79 | 63 | - | - | -25.2% | -10.6% | 28.1% | -6.3% | -5.4% | -7.8% | 6.1% | 57.0x | $396M | VS | |
$EZPW EZCORP INC | 68 | 77 | 82 | 89 | 7.2x | 4.2x | 12.0% | 6.2% | 59.1% | 11.6% | 8.5% | 10.5% | 0.0% | 52.0x | $764M | VS | |
$HTHT H World Group Ltd | 68 | 91 | 44 | 84 | - | - | - | - | - | - | - | - | - | - | $0 | VS | |
$DDL Dingdong (Cayman) Ltd | 68 | 86 | 82 | 57 | - | - | - | - | - | - | - | - | - | - | $0 | VS | |
$SBH Sally Beauty Holdings, Inc. | 68 | 83 | 92 | 77 | 5.1x | 2.3x | 32.0% | 6.6% | 51.5% | 8.4% | 4.9% | -1.0% | 0.0% | 178.0x | $934M | VS | |
$SPH SUBURBAN PROPANE PARTNERS LP | 67 | 80 | 90 | 53 | - | 13.0x | 0.4% | -3.5% | 61.7% | 2.1% | -5.7% | 2.2% | 7.1% | 190.0x | $1.2B | VS | |
$IHG INTERCONTINENTAL HOTELS GROUP PLC /NEW/ | 67 | 63 | 81 | 67 | - | - | - | - | - | - | - | - | - | - | $0 | VS | |
$ROST ROSS STORES, INC. | 67 | 63 | 55 | 83 | 25.2x | 16.5x | 34.8% | 13.3% | 28.0% | 11.6% | 9.1% | 10.4% | 1.0% | 26.0x | $51.6B | VS | |
$FND Floor & Decor Holdings, Inc. | 44 | 45 | 43 | 36 | 33.6x | 26.1x | 9.2% | 4.0% | 43.6% | 6.1% | 4.7% | 4.1% | 0.0% | 127.0x | $8.3B | ||
| SECTOR BENCH | - | - | - | - | - | 21.4x | 9.1x | 9.6% | 3.6% | 37.3% | 4.4% | 2.4% | 3.7% | 0.0% | 0.7x | - | REF |
Floor & Decor Holdings, Inc. (FND) receives a "Reduce" rating with a composite score of 43.6/100. It ranks #3042 out of 7,333 stocks in our coverage universe and carries a 2-star rating. Ratings are driven by a 6-factor quantitative model measuring quality, value, momentum, investment, stability, and short interest.
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Lagging peers — losers tend to keep underperforming
Fair valuation relative to peers
Average quality profile
Average volatility — neutral timing signal
Aggressive spending — empire-building risk, dilutive growth
Mid-range overall rating
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Relative valuation derived from Retail Trade sector benchmarks. Model weights: EV/EBITDA (40%), P/B (35%), P/S (25%). Re-calculated daily.
Projection based on user-defined inputs. Re-calculated daily against current market data.
Reverse DCF Framework — Mauboussin Methodology
Institutional-grade Reverse DCF analysis. This model identifies the growth hurdles embedded in current market prices. When implied growth is significantly lower than historical or projected rates, a margin of safety may exist. Re-audited daily.
No analyst ratings for FND.
View All Ratings| Factor | Global | Sector | Tilt |
|---|---|---|---|
| PROFITABILITY | 45 | 43 | +2NEUTRAL |
| MOMENTUM | 36 | 33 | +3NEUTRAL |
| VALUATION | 43 | 42 | +1NEUTRAL |
| INVESTMENT | 34 | 56 | -22DRAG |
| STABILITY | 50 | 51 | -1NEUTRAL |
| SHORT INT | 49 | 51 | -2NEUTRAL |
Global = full universe. Sector = relative to industry peers. Positive tilt indicates idiosyncratic strength.
ROE proxy 9.2% (sector 9.6%)
GM 44% vs sector 37%, OM 6% vs sector 4%
Capital turnover N/A
Rev growth 4%, 9yr history
Interest coverage 457.0x, Net debt/EBITDA -0.0x
Composite assessment of profitability, capital efficiency, and financial strength. Top-tier entities demonstrate sustainable cash flow generation and elite competitive moats.
Profit generated per dollar of shareholder equity
Efficiency of asset utilization
Pricing power and cost efficiency
Core business profitability
Bottom-line profitability
The Quality factor evaluates the persistence and magnitude of realized cash flows. Companies with scores >70 exhibit superior pricing power and structural financial resilience through diverse economic regimes.
Our uncertainty rating tracks the predictability of future cash flows and potential for permanent capital loss. Moderate visibility with standard industry cyclicality.
We rate Floor & Decor Holdings, Inc. (FND) as a Reduce with a composite score of 43.6/100 at a current price of $69.62. The quantitative profile shows weakness across multiple dimensions, suggesting limited upside potential.
Floor & Decor Holdings, Inc. holds a top-quartile position (#0 of 50) within the Retail Trade sector, based on our composite quantitative scoring across quality, value, momentum, and stability factors. The composite score of 43.6/100 places it at rank #3042 in our full universe.
Narrow
High
Poor
Fair Value
Gross margins of 44% signal strong pricing power.
Stable competitive position in a defensive sector.
Leverage of 127% D/E amplifies downside risk.
Vulnerability to macroeconomic shocks and interest rate volatility.
Floor & Decor Holdings, Inc. represents a reduce based on multi-factor quantitative performance.
Floor & Decor Holdings, Inc. receives a Reduce rating from our analysis, with a composite score of 43.6/100 and 2 out of 5 stars, ranking #3042 out of 7,333 stocks. FND's factor profile shows weakness across multiple dimensions, suggesting the stock may underperform going forward. Existing holders may want to consider trimming positions or tightening stop-losses.
With a quality score of 45/100, FND shows adequate but unremarkable business quality. The company reports a return on equity of 9.2% (sector avg: 9.6%), gross margins of 43.6% (sector avg: 37.3%), net margins of 4.7% (sector avg: 2.4%). This suggests the company generates acceptable returns but may lack the competitive positioning or operational efficiency to stand out from peers.
With a value score of 43/100, FND appears somewhat expensive relative to its fundamentals. Key valuation metrics include a P/E ratio of 33.64x, an EV/EBITDA of 26.13x, a P/B ratio of 3.09x. Investors paying a premium here are likely betting on above-average growth or margin expansion to justify current prices.
Floor & Decor Holdings, Inc.'s investment score of 34/100 suggests limited reinvestment activity. Key growth metrics include revenue growth of 4.1% vs. a sector average of 3.7% and a return on assets of 4.0% (sector: 3.6%). While this can be positive for mature, cash-generative businesses returning capital to shareholders, it may also signal a lack of growth opportunities or management conservatism.
FND is currently showing below-average momentum at 36/100, which may indicate weakening institutional interest or negative sentiment shifts. Revenue growth stands at 4.1% year-over-year, while a beta of 1.31 reflects its sensitivity to broader market moves. Investors should note that declining momentum can precede further price weakness, though contrarian opportunities sometimes emerge at these levels.
With a stability score of 50/100, FND exhibits average financial resilience. Key stability metrics include a beta of 1.31 and a debt-to-equity ratio of 127.00x (sector avg: 0.7x). While the balance sheet is not a major concern, the stock is subject to typical market volatility and may experience sharper drawdowns during risk-off episodes.
The short interest score of 49/100 for FND suggests somewhat elevated bearish positioning by institutional traders. Specific risk factors include above-average market sensitivity (beta: 1.31), elevated leverage (D/E: 127.00x). With a $8.3B market cap (mid-cap), Floor & Decor Holdings, Inc. may experience above-average volatility. Investors should consider whether the short thesis has merit or if it creates a potential short-squeeze opportunity.
Floor & Decor Holdings, Inc. is a mid-cap company in the Retail Trade sector, ranked #0 of 50 in its sector (100th percentile) and #3042 of 7,333 overall (59th percentile). Key comparisons include ROE of 9.2% trailing the 9.6% sector median and operating margins of 6.1% above the 4.4% sector average. This top-quartile standing reflects exceptional competitive strength relative to Retail Trade peers.
While FND currently exhibits a REDUCE profile, superior opportunities exist within the RETAIL TRADE sector. Our model identifies several "Strong Buy" candidates with higher quality scores and more attractive valuations among direct industry competitors.
View Top Retail Trade Alpha →Quant Factor Profile
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Improvement in Investment (34) would have the largest impact on the composite score.
EV/EBITDA 187% ABOVE SECTOR MEDIAN
ROE IN LINE WITH SECTOR BENCHMARKS
Gross Margin 17% ABOVE SECTOR MEDIAN (FAVORABLE)
Above 50MA
37.18%
Net New Highs
+51081
The author disagrees with Warren Buffett's Berkshire Hathaway's decision to sell shares of Ulta Beauty and Floor & Decor, and believes both stocks are poised to outperform the S&P 500 over the next five years.
FND beats Q4 EPS estimates, and a 2% increase in sales, as store expansion and disciplined pricing show resilience.
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Abdiel Capital fully exited its position in Floor & Decor Holdings, selling 1,482,936 shares worth $112.64 million, reducing its assets under management and potentially signaling concerns about the company's performance and housing market conditions.