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I’ve been keeping an eye on Weibo Corporation (NASDAQ:WB) because I’m attracted to its fundamentals. Looking at the company as a whole, as a potential stock investment, I believe WB has a lot to offer. Basically, it is a financially-healthy company with a great track record and an optimistic growth outlook. Below, I’ve touched on some key aspects you should know on a high level. For those interested in understanding where the figures come from and want to see the analysis, take a look at the report on Weibo here.
Solid track record with excellent balance sheet
WB is expected to churn out cash in the short term, with its operating cash flow predicted to expand by 91%. This underlies the notable 26% return on equity over the next few years leading up to 2022. Over the past few years, WB has demonstrated a proven ability to generate robust returns of 33% Unsurprisingly, WB surpassed the Interactive Media and Services industry return of 13%, which gives us more confidence of the company’s capacity to drive earnings going forward.
WB’s ability to maintain an adequate level of cash to meet upcoming liabilities is a good sign for its financial health. This implies that WB manages its cash and cost levels well, which is a key determinant of the company’s health. WB seems to have put its debt to good use, generating operating cash levels of 0.55x 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.
For Weibo, there are three relevant factors you should look at:
- Valuation: What is WB 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 WB is currently mispriced by the market.
- Dividend Income vs Capital Gains: Does WB 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 WB as an investment.
- Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of WB? 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.