Aratana Therapeutics, Inc. (NASDAQ:PETX): Commentary On Fundamentals

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Attractive stocks have exceptional fundamentals. In the case of Aratana Therapeutics, Inc. (NASDAQ:PETX), there’s is a company with strong financial health as well as a buoyant growth outlook. 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 Aratana Therapeutics here.

Excellent balance sheet with high growth potential

PETX is an attractive stock for growth-seeking investors, with an expected earnings growth of 54% in the upcoming year. Earnings growth is paired with an eye-catching top-line trajectory of 71%, which indicates a high-quality bottom-line expansion, as opposed to those driven simple by unsustainable cost-cutting activities. PETX 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 crucial insight into the health of the company. With a debt-to-equity ratio of 23%, PETX’s debt level is acceptable. This indicates a good balance between taking advantage of low cost funding through debt financing, but having enough financial flexibility and headroom to grow debt in the future.

NASDAQGM:PETX Future Profit February 12th 19
NASDAQGM:PETX Future Profit February 12th 19

Next Steps:

For Aratana Therapeutics, there are three fundamental factors you should further research:

  1. Historical Performance: What has PETX’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.
  2. Valuation: What is PETX 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 PETX is currently mispriced by the market.
  3. Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of PETX? Explore our interactive list of stocks with large potential to get an idea of what else is out there you may be missing!

To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.

The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.