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Should You Consider On the Beach Group plc (LON:OTB)?

Simply Wall St

Attractive stocks have exceptional fundamentals. In the case of On the Beach Group plc (LON:OTB), there's is a company with strong financial health as well as an optimistic future outlook. Below, I've touched on some key aspects you should know on a high level. For those interested in digging a bit deeper into my commentary, read the full report on On the Beach Group here.

Flawless balance sheet with reasonable growth potential

OTB is expected to churn out cash in the short term, with its operating cash flow predicted to expand by 80%. This underlies the notable 24% return on equity over the next few years leading up to 2022. OTB's strong financial health means that all of its upcoming liability payments are able to be met by its current cash and short-term investment holdings. This implies that OTB manages its cash and cost levels well, which is an important determinant of the company’s health. OTB seems to have put its debt to good use, generating operating cash levels of 2.39x 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.

LSE:OTB Past and Future Earnings, September 21st 2019

Next Steps:

For On the Beach Group, I've compiled three essential factors you should further examine:

  1. Historical Performance: What has OTB'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 OTB 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 OTB is currently mispriced by the market.
  3. Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of OTB? 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.