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I’ve been keeping an eye on Arotech Corporation (NASDAQ:ARTX) because I’m attracted to its fundamentals. Looking at the company as a whole, as a potential stock investment, I believe ARTX has a lot to offer. Basically, it is a financially-robust company with a an optimistic future outlook, not yet reflected in the share price. In the following section, I expand a bit more on these key aspects. If you’re interested in understanding beyond my broad commentary, read the full report on Arotech here.
Excellent balance sheet and good value
ARTX’s share price is trading at below its true value, meaning that the market sentiment for the stock is currently bearish. Investors have the opportunity to buy into the stock to reap capital gains, if ARTX’s projected earnings trajectory does follow analyst consensus growth, which determines my intrinsic value of the company. Also, relative to the rest of ARTX’s peers, it is also trading at a value below those of similar sizes in asset terms. This bolsters the proposition that ARTX’s price is currently discounted.
ARTX 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 a key determinant of the company’s health. ARTX’s has produced operating cash levels of 0.23x total debt over the past year, which implies that ARTX’s management has put its borrowings into good use by generating enough cash to cover a sufficient portion of borrowings.
For Arotech, there are three fundamental factors you should look at:
- Historical Performance: What has ARTX’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.
- Dividend Income vs Capital Gains: Does ARTX return gains to shareholders through reinvesting in itself and growing earnings, or redistribute a decent portion of earnings as dividends? Our historical dividend yield visualization quickly tells you what your can expect from ARTX as an investment.
- Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of ARTX? 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 email@example.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.