One-glance verdict
Overvalued
$175.73 our estimate vs market $407.40
Wall Street consensus: $734.11 (317.7% higher than our fair-value estimate)
132% above our estimate, beyond the bull case
Fundamentals snapshot
Fabrinet
FN · NYQ · Technology · Electronic Components
Current price
$407.40
52-week range
$348.01 - $748.89
Market cap
$14.60B
Balance sheet
Healthy
5,511.95x Strong cushion
Net cash $871.04M. Interest coverage shows how many times profit covers the interest bill.
What stands out
3 Rewards
2 Risks
3 rewards · 2 risks
- Reward Revenue grew 35.7% last year.
- Reward Returns 21.3% on equity, ahead of 50% of its peers.
- Risk Insider ownership is only 0.4% (peer median: 1.4%).
- Risk Stock trades 0.2% above its 5-year average P/E.
What this company does
Fabrinet
Fabrinet is a specialized manufacturer that builds complex optical and electronic parts for other technology companies, essentially acting as their high-tech factory. The company makes most of its money from optical communication products, the tiny, critical pieces that help power the internet and data centers. By managing its customers' entire supply chain (the complete process of turning raw materials into a finished product), Fabrinet plays a key role in bringing advanced technology to the market.
How the company got here
Fabrinet was started in 1999 by David T. Mitchell, who had previously co-founded the data storage company Seagate. He established the business in Thailand, taking over a former Seagate factory to create a specialized manufacturing company. From the beginning, Fabrinet focused on making complex optical components, which are tiny, precise parts that manage light for communications. The company became publicly traded on the New York Stock Exchange in 2010 and has since grown by becoming a trusted manufacturing partner for other technology companies.
What it actually does
Fabrinet is a contract manufacturer, which means it doesn't sell products under its own brand name. Instead, other companies, known as original equipment manufacturers or OEMs, hire Fabrinet to build the complex products they design. Think of it like a highly specialized workshop that other companies use to produce their most difficult-to-make parts. Fabrinet provides the entire manufacturing service, from helping to design the production process and managing the supply chain (the network of companies providing raw materials) to assembling and testing the final product.
Optical Communications
This is Fabrinet's largest and most important business, making up the majority of its revenue. This division builds the critical components that power the internet and data networks. The parts they make, like transceivers (devices that send and receive data), switches, and lasers, go inside the networking equipment that allows voice, video, and data to travel through fiber optic cables. Companies that build the infrastructure for telecommunications and large data centers pay Fabrinet to manufacture these highly complex optical parts for them.
Industrial, Automotive, and Other Markets
This part of the business provides manufacturing for a variety of other advanced industries, helping the company avoid being dependent on just one area. It produces industrial lasers used for precise cutting in factories or in medical devices. It also makes sensors and components for the automotive industry, as well as custom parts like lenses and prisms for medical and diagnostic equipment. While smaller than the optical business, this segment serves a wide range of customers who need high-precision manufacturing.
What management is betting on now
The company's leadership is focused on expanding its manufacturing capacity, especially in Thailand, to meet the growing demand for its services. A major priority is capturing more business from the growth of data centers and artificial intelligence, which require the powerful, high-speed optical components that Fabrinet specializes in. Management also aims to diversify its customer base to reduce its reliance on a small number of large clients. They are also leveraging their expertise to expand further into markets like automotive components and medical devices.
Price history
How the share price has moved
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Earnings history
Last 8 quarters — what happened
Click any quarter to read the call summary and what the numbers say.
FY2025 Q1
$62.93M
FY2025 Q2
$94.00M
FY2025 Q3
$45.67M
FY2025 Q4
$4.68M
FY2026 Q1
$57.30M
FY2026 Q2
$-5.35M
FY2026 Q3
$-10.83M
FY2026 Q4
$-36.90M
Revenue
$1.32B
Net income
$139.26M
Diluted EPS
3.83
Operating cash flow
$54.97M
Free cash flow
$-36.90M
Fetching…
Sources
Revenue
$1.21B
Net income
$125.21M
Diluted EPS
3.45
Operating cash flow
$52.93M
Free cash flow
$-10.83M
Fetching…
Sources
Revenue
$1.13B
Net income
$112.63M
Diluted EPS
3.11
Operating cash flow
$46.26M
Free cash flow
$-5.35M
Fetching…
Sources
Revenue
$978.13M
Net income
$95.93M
Diluted EPS
2.66
Operating cash flow
$102.57M
Free cash flow
$57.30M
Fetching…
Sources
Revenue
$909.69M
Net income
$87.21M
Diluted EPS
2.41
Operating cash flow
$55.09M
Free cash flow
$4.68M
Fetching…
Sources
Revenue
$871.80M
Net income
$81.29M
Diluted EPS
2.25
Operating cash flow
$74.19M
Free cash flow
$45.67M
Fetching…
Sources
Revenue
$833.61M
Net income
$86.64M
Diluted EPS
2.38
Operating cash flow
$115.90M
Free cash flow
$94.00M
Fetching…
Sources
Revenue
$804.23M
Net income
$77.39M
Diluted EPS
2.13
Operating cash flow
$83.18M
Free cash flow
$62.93M
Fetching…
Sources
Is it cheap or expensive?
Fair value $175.73 vs current price $407.40
Wall Street consensus is the average analyst price target: $734.11 (317.7% higher than our fair-value estimate).
Our most-likely fair value is $175.73 a share — about 56.9% below today's price of $407.40, so the stock currently looks expensive (overvalued).
Is it drowning in debt?
Healthy
Net cash $871.0M - more cash than debt. Interest coverage 5512.0x.
Net debt
$-871.04M
Interest coverage
5,511.95x
Fabrinet's profit covers its interest bill about 5512.0 times over. which is stronger than every peer shown here.
Healthy
Worse cushion
Baseline
Better cushion
FN
BASELINE
Fabrinet
Total debt $4.01M Interest coverage 5,511.95x This is the baseline the peer rows are being compared against.
Total debt $3.94B Interest coverage 9.77x -100% vs FN Carries about 564.2x less debt cushion than FN.
Total debt $2.43B Interest coverage 19.60x -100% vs FN Carries about 281.2x less debt cushion than FN.
Total debt $306.96M Interest coverage 17.84x -100% vs FN Carries about 308.9x less debt cushion than FN.
Total debt $981.20M Interest coverage 20.35x -100% vs FN Carries about 270.9x less debt cushion than FN.
Total debt $291.82M Interest coverage 5.24x -100% vs FN Carries about 1052.3x less debt cushion than FN.
What you should know
The case for and against FN
3 Rewards
2 Risks
Rewards
-
Revenue grew 35.7% last year.
-
Returns 21.3% on equity, ahead of 50% of its peers.
-
Free cash flow was positive in 10/10 years.
Risks
-
Insider ownership is only 0.4% (peer median: 1.4%).
-
Stock trades 0.2% above its 5-year average P/E.
The numbers
All the key metrics, grouped by purpose
Tap any ? icon to learn what it means.
Valuation
How expensive the stock looks
P/E (TTM)
31.24x
Forward P/E
18.70x
P/B
5.95x
P/S
3.15x
EV/EBITDA
25.03x
PEG ratio
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Profitability
How much profit each dollar creates
Gross margin
12.0%
Operating margin
10.2%
Net margin
10.2%
ROE
21.3%
ROA
8.6%
Health
Liquidity and balance-sheet strength
Debt / equity
0.00x
Current ratio
2.25x
Quick ratio
1.35x
Total debt
$4.01M
Total cash
$875.05M
Growth
How the business has been compounding
Revenue TTM
$4.64B
Revenue 5Y CAGR
19.7%
EPS TTM
13.04
EPS 5Y CAGR
24.7%
Cash flow
How much cash the business throws off
Operating CF TTM
$256.73M
Free CF TTM
$4.22M
FCF margin
0.1%
Dividend
Shareholder payout
Yield
—
Payout ratio
0.0%
Last ex-div date
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