Should You Consider AeroVironment, Inc. (NASDAQ:AVAV)?
Building up an investment case requires looking at a stock holistically. Today I’ve chosen to put the spotlight on AeroVironment, Inc. (NASDAQ:AVAV) due to its excellent fundamentals in more than one area. AVAV is a financially-robust company with an impressive history and a excellent future outlook. Below is a brief commentary on these key aspects. For those interested in understanding where the figures come from and want to see the analysis, read the full report on AeroVironment here.
Flawless balance sheet with high growth potential
AVAV has a strong track record of performance. In the previous year, AVAV delivered an impressive double-digit return of 8.9% Unsurprisingly, AVAV surpassed the industry return of 7.0%, which gives us more confidence of the company’s capacity to drive earnings going forward.
AVAV is financially robust, with ample cash on hand and short-term investments to meet upcoming liabilities. This implies that AVAV manages its cash and cost levels well, which is a key determinant of the company’s health. AVAV currently has no debt on its balance sheet. This means it is running its business only on equity capital funding, which is typically normal for a small-cap company. AVAV has plenty of financial flexibility, without debt obligations to meet in the short term, as well as the headroom to raise debt should it need to in the future.
Next Steps:
For AeroVironment, there are three pertinent aspects you should look at:
Valuation: What is AVAV 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 AVAV is currently mispriced by the market.
Dividend Income vs Capital Gains: Does AVAV 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 AVAV as an investment.
Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of AVAV? 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.
