Fabasoft AG (ETR:FAA) is a company with exceptional fundamental characteristics. Upon building up an investment case for a stock, we should look at various aspects. In the case of FAA, it is a company with great financial health as well as a a strong track record of performance. Below, I've touched on some key aspects you should know on a high level. For those interested in digger a bit deeper into my commentary, take a look at the report on Fabasoft here.
Flawless balance sheet with outstanding track record
Over the past year, FAA has grown its earnings by 46%, with its most recent figure exceeding its annual average over the past five years. This strong performance generated a robust double-digit return on equity of 21%, which is what investors like to see! FAA is financially robust, with ample cash on hand and short-term investments to meet upcoming liabilities. This implies that FAA manages its cash and cost levels well, which is a key determinant of the company’s health. Investors should not worry about FAA’s debt levels because the company has none! It has only utilized funding from its equity capital to run the business, which is typically normal for a small-cap company. Therefore the company has plenty of headroom to grow, and the ability to raise debt should it need to in the future.
Next Steps:
For Fabasoft, there are three fundamental aspects you should look at:
- Future Outlook: What are well-informed industry analysts predicting for FAA’s future growth? Take a look at our free research report of analyst consensus for FAA’s outlook.
- Valuation: What is FAA worth today? Is the stock undervalued, even when its growth outlook is factored into its intrinsic value? The intrinsic value infographic in our free research report helps visualize whether FAA is currently mispriced by the market.
- Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of FAA? Explore our interactive list of stocks with large potential to get an idea of what else is out there you may be missing!
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.