MEXICAN ECONOMIC DEVELOPMENT INC

Where It Passes

Where It Falls Short

• Valuation0% pass✓ 2✗ 26▾

  No clean pass — all 13 investors flag at least one valuation criterion

  Net income / market capitalization+4.34%; #1893/6340 (top 29.9%)

  ✓AsnessTop 30% of eligible cross-section✗OshaughnessyTop 10% of eligible cross-section

  Price / 3-yr avg EPS

  ✗Graham<= 15x

  Price-to-Book Ratio163.7x

  ✗Graham<= 1.5x

  P/E x P/B

  ✗Graham<= 22.5

  Basic earnings-growth PEG (dividends excluded)

  ✗Lynch< 1.0 (ideally < 0.5)

  EBIT / Enterprise Value8.4%

  ✗Greenblatt> 10%

  Earnings Yield + ROC AssessmentEY=8.4%, ROC=31.5%

  ✗GreenblattBoth EY > 10% and ROC > 25%

  Price / EPS

  ✗Dreman< 12x✗Templeton< 12x (fixed ceiling; proxy for the market's cheapest 40%)

  Price / (CFO / Shares)

  ✗Dreman< 8x

  Price / Book Value per Share163.7x

  ✗Dreman< 1.2x✗Templeton< 1.5x✗SchlossP/B <= 0.80x (app cutoff)

  Valuation ReasonablenessOE Yield=0.1%

  ✗MungerP/E < 25 or Owner Earnings Yield > 5%

  P/E or FCF Yield

  ✗PabraiP/E < 15 or FCF Yield > 10%

  P/B or P/E vs. Historical AverageP/B=163.7x

  ✗MarksP/E < 15 or P/B < 2.0

  Discount to Intrinsic Value

  ✗Marks>= 20% below intrinsic value

  Price / FCF per Share

  ✗Ackman<= 25

  Price vs. Trailing Low155% of trailing low ($85.32)

  ✗Templeton<= 120% of trailing low (certified split-adjusted live window)

  Positive book equity / market capitalization+0.3209; #3599/6449 (top 55.8%)

  ✗AsnessTop 30% of eligible cross-section

  Price / Diluted EPS

  ✗NeffP/E <= 15x (app proxy for a P/E 40%-60% below the market)

  (EPS CAGR % + Dividend Yield %) / P/E

  ✗Neff> 0.7 (Neff's published traditional edge)

  Price / Tangible Book Value per Share163.67x

  ✗SchlossP/TBV <= 1.00x (app cutoff)

  Book Value per Share Change+8.3%

  ✓SchlossLatest BVPS >= earliest BVPS over >= 3 years (app rule)

  Revenue / market capitalization+0.8430; #1975/5247 (top 37.6%)

  ✗OshaughnessyTop 10% of eligible cross-section

  (Operating cash flow - capex) / market capitalization

  ✗OshaughnessyTop 10% of eligible cross-section

  Trailing six-month price return through the evaluation date+13.12%; #1688/6202 (top 27.2%)

  ✗OshaughnessyTop 10% of eligible cross-section
• Valuation models0% pass✗ 4▾

  FMX overvalued: all 4 models price fair value below $131.91 (median $2.06)

  Buffett fair value$1.15

  ✗Buffett-11370.4% margin vs $131.91

  Greenblatt fair value$2.01

  ✗Greenblatt-6462.7% margin vs $131.91

  Pabrai fair value$2.11

  ✗Pabrai-6151.7% margin vs $131.91

  Akre fair value$2.12

  ✗Akre-6122.2% margin vs $131.91
• Profitability6% pass✓ 9✗ 26▾

  15 of 16 flag FMX's profitability — Graham, Buffett, Lynch +12 more

  Net income / market capitalization+4.34%; #1893/6340 (top 29.9%)

  ✓AsnessTop 30% of eligible cross-section✗OshaughnessyTop 10% of eligible cross-section

  Positive EPS (10 years)0/11 years positive

  ✗GrahamPositive EPS every year for 10 years

  EPS Growth (3-yr avg, 10-yr window)

  ✗Graham>= 33% growth

  Net Income Positive (10+ years)10/11 years positive

  ✗BuffettPositive every year for 10+ years

  ROE (up to 5-year arithmetic mean)13.6%

  ✗Buffett> 15% arithmetic mean (app rule)

  Operating Margin (10-yr trend)

  ✗BuffettStable or rising over 10 years

  Free Cash Flow Proxy$1.7B

  ✓BuffettPositive and growing

  Earnings Variance (10-yr CoV)

  ✗BuffettCoV < 0.3

  Retained Earnings Effectiveness

  ✗Buffett$1 retained -> > $1 market value created

  Basic earnings-growth PEG (dividends excluded)

  ✗Lynch< 1.0 (ideally < 0.5)

  3-5 Year EPS CAGR

  ✗Lynch15-30% (Fast Grower); > 0% to pass

  ROE13.5%

  ✗Lynch> 15%

  EBIT / Enterprise Value8.4%

  ✗Greenblatt> 10%

  Earnings Yield + ROC AssessmentEY=8.4%, ROC=31.5%

  ✗GreenblattBoth EY > 10% and ROC > 25%

  Net Income / Total Assets4.73%

  ✓PiotroskiROA > 0

  ROA Change YoY9.51% -> 4.73% (delta: -4.79%)

  ✗PiotroskiCurrent ROA > Prior ROA

  (CFO / Total Assets) vs ROA

  ✗PiotroskiCFO/Assets > ROA

  Gross Margin Change YoY39.8% -> 41.1%

  ✓PiotroskiImproved YoY

  Pre-Tax Income / Revenue8.4%

  ✓Dreman>= 8%

  Net Income / Shareholders' Equity13.5%

  ✓Dreman> 12%

  Margin of SafetyP/B=163.7x

  ✗PabraiP/B < 1.5 or P/E < 15

  Return on Equity17.3% (3-yr avg)

  ✗AkreROE > 20% (3-year avg)

  Discount to Intrinsic Value

  ✗Marks>= 20% below intrinsic value

  Positive Net Income Frequency10/10 years positive

  ✓MarksPositive net income in >= 7 of last 10 years

  Operating Income / Revenue

  ✗Ackman>= 15%

  Net Income / Shareholders Equity13.5%

  ✗Ackman>= 15%

  5-Year EPS CAGR

  ✗Templeton> 0% (5-year EPS CAGR)

  Operating Margin Trend

  ✗TempletonNon-negative operating-margin trend over 3 years

  Revenue growth vs. gross and operating margin trend

  ✗SleepRevenue rising; gross margin flat or falling; operating margin holding

  Gross profit / total assets+37.76%; #1046/3702 (top 28.3%)

  ✓AsnessTop 30% of eligible cross-section

  Net income / positive book equity+13.52%; #1321/5226 (top 25.3%)

  ✓AsnessTop 30% of eligible cross-section

  Negative 5-year standard deviation of ROA-0.0285; #1840/5884 (top 31.3%)

  ✗AsnessTop 30% of eligible cross-section

  3-5 Year Diluted EPS CAGR

  ✗Neff7%-20% annualized

  Positive Diluted-EPS Years

  ✗Schloss>= 70% positive over 5-10 observed years (app rule)
• Growth13% pass✓ 3✗ 10▾

  7 of 8 flag FMX's growth — Graham, Lynch, Dreman +4 more

  EPS Growth (3-yr avg, 10-yr window)

  ✗Graham>= 33% growth

  Basic earnings-growth PEG (dividends excluded)

  ✗Lynch< 1.0 (ideally < 0.5)

  3-5 Year EPS CAGR

  ✗Lynch15-30% (Fast Grower); > 0% to pass

  Inventory Growth vs Revenue GrowthInv: -4.8% vs Rev: -8.6%

  ✗LynchInventory growth < Revenue growth

  EPS Growth Direction

  ✗DremanPositive over recent years

  EPS CAGR

  ✗Dreman> 5% annualized

  Positive Net Income Frequency10/10 years positive

  ✓MarksPositive net income in >= 7 of last 10 years

  3yr Median Revenue Growth24.2%

  ✓Ackman>= 5%

  Positive EPS Growth Frequency

  ✗AckmanPositive EPS growth in >= 3 of last 5 years

  5-Year EPS CAGR

  ✗Templeton> 0% (5-year EPS CAGR)

  Revenue growth vs. gross and operating margin trend

  ✗SleepRevenue rising; gross margin flat or falling; operating margin holding

  5-year Revenue CAGR7.2%

  ✓SleepCAGR > 7%

  3-5 Year Diluted EPS CAGR

  ✗Neff7%-20% annualized
• Efficiency25% pass✓ 3✗ 8▾

  6 of 8 flag FMX's efficiency — Graham, Buffett, Piotroski +3 more

  Current Ratio1.69

  ✗Graham>= 2.0

  ROIC (3-5 yr avg)

  ✗Buffett> 10%

  ROIC - WACC

  ✗BuffettPositive (WACC = 10%)

  EBIT / (NWC + Net Fixed Assets)31.5%

  ✓Greenblatt> 25%

  Current Ratio Change YoY1.95 -> 1.69

  ✗PiotroskiIncreased YoY

  Revenue / Total Assets Change YoY0.87x -> 0.92x

  ✓PiotroskiImproved YoY

  Current Assets / Current Liabilities1.69

  ✓Dreman> 1.5

  Return on Invested Capital

  ✗Munger> 15%

  ROIC (high and growing)FY2022: ROIC=unavailable; FY2023: ROIC=unavailable; FY2024: ROIC=unavailable

  ✗AkreLatest 3 consecutive FYs: ROIC > 15% in each

  Reinvestment Rate x ROIC

  ✗AkreReinvestment Rate * ROIC > 10%

  ROIC (5-year)

  ✗SleepROIC > 12% in a majority of years
• Cash Flow30% pass✓ 3✗ 9▾

  7 of 10 flag FMX's cash flow — Lynch, Piotroski, Dreman +4 more

  Free Cash Flow Proxy$1.7B

  ✓BuffettPositive and growing

  FCF Positive and Growing$1.1B

  ✗LynchPositive and growing

  Operating Cash Flow

  ✗PiotroskiCFO > 0

  (CFO / Total Assets) vs ROA

  ✗PiotroskiCFO/Assets > ROA

  Price / (CFO / Shares)

  ✗Dreman< 8x

  P/E or FCF Yield

  ✗PabraiP/E < 15 or FCF Yield > 10%

  FCF Positive3/3 years FCF positive

  ✓MarksPositive FCF in majority of recent years

  (OCF - CapEx) / Market Cap

  ✗Ackman>= 4%

  Price / FCF per Share

  ✗Ackman<= 25

  Positive Operating Cash Flow frequency3/3 years positive

  ✓SleepPositive OCF in >= 70% of available years

  Operating Cash Flow - Capital Expenditures

  ✗Neff> $0 (app proxy for a strong fundamental case)

  (Operating cash flow - capex) / market capitalization

  ✗OshaughnessyTop 10% of eligible cross-section
• Verdicts43% pass✓ 6✗ 8▾

  Split decision: 8 FAIL · 4 PASS · 3 NEUTRAL · 1 BUY

  Overall verdict

  ✗GrahamFAIL (1/9)✗BuffettFAIL (1/9)✗LynchFAIL (0/7)✓GreenblattRank #496✓PiotroskiPASS (F-Score 4)✓DremanPASS (5/11)✓MungerPASS (2/4)✗PabraiFAIL (0/3)✗AkreFAIL (1/6)✗MarksFAIL (3/5)✓AckmanPASS (4/9)✗TempletonFAIL (3/8)•SleepNEUTRAL (4/6)✓AsnessBUY (Rank #260/2370 (Top 11.0%))✗NeffFAIL (2/6)•SchlossNEUTRAL (4/7)•OshaughnessyNEUTRAL (Not ranked)
• Debt & Leverage50% pass✓ 8✗ 7▾

  6 of 12 pass — Graham, Buffett, Lynch +3 more object

  Debt Levels0.49

  ✓MungerDebt/Equity < 0.5✗AkreDebt/Equity < 0.3

  LT Debt vs Net Current AssetsLT Debt $6.9B vs NCA $6.8B

  ✗GrahamLT Debt <= Net Current Assets

  Debt/Equity & Interest CoverageD/E: 0.49, IC: 4.3x

  ✗BuffettD/E < 0.5 AND Interest Coverage > 5x

  Total Debt / Equity0.49

  ✗Lynch< 0.33

  Cash - Long-term Debt$-4.5B

  ✗LynchPositive preferred

  LT Debt / Total Assets Change15.93% -> 16.61%

  ✗PiotroskiDecreased YoY

  Current Assets / Current Liabilities1.69

  ✓Dreman> 1.5✓SchlossCurrent ratio >= 1.50x (app cutoff)

  Total Debt / Shareholders' Equity0.49

  ✓Dreman< 0.8✓Templeton< 1.0 (fixed cap; proxy for below-sector-median leverage)✓SchlossD/E < 1.00x

  Interest Coverage & Debt/EBITDAIC=4.3x, D/EBITDA=1.2x

  ✓MarksInterest Coverage > 3x; Debt/EBITDA < 4x

  Total Debt / Shareholders Equity0.49

  ✓Ackman<= 1.0

  Negative debt-to-equity (higher means less debt)-0.4883; #2440/4210 (top 58.0%)

  ✗AsnessTop 30% of eligible cross-section