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Validea's pick of the week provides a detailed report on a company that scores well in the stock-screening service's model portfolios. On Validea.ca, investors can analyze 1,000 Canadian stocks through 12 different guru-based models and get individual reports on each company. Globe Investor provides marketing and data services to Validea.ca and receives compensation. Try it.

Mohawk Industries Inc. is the world's largest flooring company, with operations in Australia, Brazil, Canada, Europe, India, Malaysia, Mexico, New Zealand, Russia and the United States. It creates products for residential and commercial spaces around the world, including carpet, rugs, ceramic tile, laminate, wood, stone and vinyl flooring. Its brands include American Olean, Bigelow, Daltile, Durkan, Karastan, Lees, Marazzi, Mohawk, Pergo, Unilin, Quick-Step and IVC.

The company trades for 18.7 times trailing 12-month EPS, and 15.8 times projected earnings. It has grown EPS at a 30.7-per-cent clip over the long term (using an average of three-, four- and five-year EPS growth rates).

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The Peter Lynch model has strong interest, thanks in large part to its impressive growth and its 0.61 P/E-to-growth ratio.

Mohawk Industries has a return on capital (EBIT/tangible capital employed) of 30.1 per cent. Earnings soared last quarter (up 642 per cent), showing the kind of accelerating growth that the Martin Zweig-based model likes to see.

Sales growth also increased from 2.4 per cent (year-over-year) two quarters ago to 15.5 per cent last quarter, which the Zweig model likes. This model also likes that the debt/equity ratio (63 per cent) is below the textiles (non-apparel) industry average (79 per cent).

Mohawk Industries has a solid 16-per-cent return on equity.

It has 9-per-cent profit margins, more than twice the industry average

Click here for a complete breakdown of Validea's investing guru report.

Globe app users click here.

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Read other research reports here.

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