Flawless balance sheet and undervalued
ARCI’s ability to maintain an adequate level of cash to meet upcoming liabilities is a good sign for its financial health. This indicates that ARCI has sufficient cash flows and proper cash management in place, which is a crucial insight into the health of the company. ARCI seems to have put its debt to good use, generating operating cash levels of 0.21x 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. ARCI is currently trading below its true value, which means the market is undervaluing the company’s expected cash flow going forward. According to my intrinsic value of the stock, which is driven by analyst consensus forecast of ARCI’s earnings, investors now have the opportunity to buy into the stock to reap capital gains. Compared to the rest of the specialty retail industry, ARCI is also trading below its peers, relative to earnings generated. This further reaffirms that ARCI is potentially undervalued.
Next Steps:
For Appliance Recycling Centers of America, I’ve put together three pertinent factors you should further examine:
- Future Outlook: What are well-informed industry analysts predicting for ARCI’s future growth? Take a look at our free research report of analyst consensus for ARCI’s outlook.
- Historical Performance: What has ARCI’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.
- Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of ARCI? Explore our interactive list of stocks with large potential to get an idea of what else is out there you may be missing!