Attractive stocks have exceptional fundamentals. In the case of Vicor Corporation (NASDAQ:VICR), there’s is a financially-healthy company with a strong history and a buoyant future outlook. Below, I’ve touched on some key aspects you should know on a high level. If you’re interested in understanding beyond my broad commentary, read the full report on Vicor here.
Flawless balance sheet with solid track record
VICR is an attractive stock for growth-seeking investors, with an expected earnings growth of 44% in the upcoming year, bolstered by its impressive cash-generating ability, as analysts predict its operating cash flows will rise by 89% over the same time period. This is a sustainable driver of high-quality earnings, as opposed to pure cost-cutting activities. Over the past year, VICR has grown its earnings by 100%, with its most recent figure exceeding its annual average over the past five years. In addition to beating its historical values, VICR also outperformed its industry, which delivered a growth of 20%. This paints a buoyant picture for the company.
VICR’s ability to maintain an adequate level of cash to meet upcoming liabilities is a good sign for its financial health. This implies that VICR manages its cash and cost levels well, which is a key determinant of the company’s health. Looking at VICR’s capital structure, the company has no debt on its balance sheet. This implies that the company is running its operations purely on off equity funding. 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.
For Vicor, I’ve put together three key factors you should look at:
- Valuation: What is VICR 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 VICR is currently mispriced by the market.
- Dividend Income vs Capital Gains: Does VICR 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 VICR as an investment.
- Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of VICR? 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.