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Building up an investment case requires looking at a stock holistically. Today I’ve chosen to put the spotlight on United Internet AG (FRA:UTDI) due to its excellent fundamentals in more than one area. UTDI is a company that has been able to sustain great financial health, trading at an attractive share price. 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, read the full report on United Internet here.
Good value with adequate balance sheet
UTDI is financially robust, with ample cash on hand and short-term investments to meet upcoming liabilities. This suggests prudent control over cash and cost by management, which is an important determinant of the company’s health. UTDI appears to have made good use of debt, producing operating cash levels of 0.24x total debt in the prior year. This is a strong indication that debt is reasonably met with cash generated. UTDI’s shares are now trading at a price below its true value based on its discounted cash flows, indicating a relatively pessimistic market sentiment. This mispricing gives investors the opportunity to buy into the stock at a cheap price compared to the value they will be receiving, should analysts’ consensus forecast growth be correct. Also, relative to the rest of its peers with similar levels of earnings, UTDI’s share price is trading below the group’s average. This bolsters the proposition that UTDI’s price is currently discounted.
For United Internet, I’ve compiled three key aspects you should further research:
- Future Outlook: What are well-informed industry analysts predicting for UTDI’s future growth? Take a look at our free research report of analyst consensus for UTDI’s outlook.
- Historical Performance: What has UTDI’s returns been like over the past? Go into more detail in the past track record analysis and take a look at the free visual representations of our analysis for more clarity.
- Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of UTDI? 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 firstname.lastname@example.org. 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.