June Fundamental Stock Pick: Nicolás Correa SA (BME:NEA)

Nicolás Correa SA (BME:NEA) is a stock with outstanding fundamental characteristics. When we build an investment case, we need to look at the stock with a holistic perspective. In the case of NEA, it is a company with great financial health as well as a a great history of performance. In the following section, I expand a bit more on these key aspects. For those interested in understanding where the figures come from and want to see the analysis, read the full report on Nicolás Correa here.

Flawless balance sheet with solid track record

In the previous year, NEA has ramped up its bottom line by 86.02%, with its latest earnings level surpassing its average level over the last five years. Not only did NEA outperformed its past performance, its growth also exceeded the Machinery industry expansion, which generated a 14.86% earnings growth. This is what investors like to see! NEA's strong financial health means that all of its upcoming liability payments are able to be met by its current cash and short-term investment holdings. This indicates that NEA has sufficient cash flows and proper cash management in place, which is a key determinant of the company’s health. NEA seems to have put its debt to good use, generating operating cash levels of 0.35x total debt in the most recent year. This is also a good indication as to whether debt is properly covered by the company’s cash flows.

Next Steps:

For Nicolás Correa, there are three essential aspects you should further research:

1. Future Outlook: What are well-informed industry analysts predicting for NEA’s future growth? Take a look at our free research report of analyst consensus for NEA’s outlook.
2. Valuation: What is NEA 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 NEA is currently mispriced by the market.
3. Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of NEA? Explore our interactive list of stocks with large potential to get an idea of what else is out there you may be missing!

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Simply Wall St analyst Simply Wall St and Simply Wall St have no position in any of the companies mentioned. This article is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.