Yahoo Finance Why Fundamental Investors Might Love Ratti S.p.A. (BIT:RAT)
Want to participate in a short research study? Help shape the future of investing tools and you could win a $250 gift card!
Building up an investment case requires looking at a stock holistically. Today I've chosen to put the spotlight on Ratti S.p.A. (BIT:RAT) due to its excellent fundamentals in more than one area. RAT is a financially-healthy company with a a strong history of performance, trading at a discount. 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 Ratti here.
Outstanding track record and good value
Over the past year, RAT has grown its earnings by 74%, with its most recent figure exceeding its annual average over the past five years. This illustrates a strong track record, leading to a satisfying return on equity of 20%. which is what investors like to see! RAT is financially robust, with ample cash on hand and short-term investments to meet upcoming liabilities. This indicates that RAT has sufficient cash flows and proper cash management in place, which is a key determinant of the company’s health. RAT seems to have put its debt to good use, generating operating cash levels of 0.37x 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.
RAT's share price is trading at below its true value, meaning that the market sentiment for the stock is currently bearish. According to my intrinsic value of the stock, which is driven by analyst consensus forecast of RAT's earnings, investors now have the opportunity to buy into the stock to reap capital gains. Also, relative to the rest of its peers with similar levels of earnings, RAT's share price is trading below the group's average. This further reaffirms that RAT is potentially undervalued.
Next Steps:
For Ratti, I've compiled three essential aspects you should further research:
Future Outlook: What are well-informed industry analysts predicting for RAT’s future growth? Take a look at our free research report of analyst consensus for RAT’s outlook.
Dividend Income vs Capital Gains: Does RAT 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 RAT as an investment.
Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of RAT? 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 editorial-team@simplywallst.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.
