Matthews International Corporation Class A Common Stock (MATW)

FairStock Score: 37/100 — MIXED

Key Financials

Strengths

• Generates $94 million in annual free cash flow (10.9% yield on market cap)
• Attractive 3.6% dividend yield providing steady income returns

Concerns

• Trades significantly above Graham Number ($17) with negative 67% margin of safety—limited downside protection
• Revenue declining at 29.1% year-over-year signals potential demand weakness or market share loss
• Altman Z-Score of 1.3 places it in the financial distress zone—elevated bankruptcy risk

AI Analysis

Matthews International Corporation Class A Common Stock is a micro-cap industrials company valued at $866 million. The business generates $1.4 billion in annual revenue with a 3.2% net margin and $94 million in free cash flow. From a quality standpoint, Matthews shows distressed Altman Z-Score of 1.3 warrants caution and modest 5% ROE. On valuation, the stock is trading at a premium 39.6x earnings, with trades above its Graham Number with a negative 67% margin. Growth dynamics show revenue growing at -29.1% and profit growth of 1356.6%. The 3.6% dividend yield adds an income component for patient holders. Our composite FairStock Score of 37/100 reflects below-average fundamentals overall. Investors should weigh the business quality against the current price and their own margin of safety requirements.

Bull Case

Improving fundamentals and sector tailwinds could drive meaningful earnings growth, compressing the effective multiple for patient investors. With $94 million in annual free cash flow (10.9% yield), management has ample capital for buybacks, dividends, or accretive acquisitions.

Bear Case

At 40x earnings, any growth disappointment triggers rapid multiple compression—a 20% earnings miss plus multiple contraction to 20x implies 40%+ downside. Regulatory changes, input cost inflation, or demand normalization represent underappreciated risks that could materially impact forward estimates.

Data from SEC filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer