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Building up an investment case requires looking at a stock holistically. Today I've chosen to put the spotlight on Cooper Tire & Rubber Company (NYSE:CTB) due to its excellent fundamentals in more than one area. CTB is a company that has been able to sustain great financial health, trading at an attractive share price. Below, I've touched on some key aspects you should know on a high level. If you're interested in understanding beyond my broad commentary, read the full report on Cooper Tire & Rubber here.
Flawless balance sheet and good value
CTB's ability to maintain an adequate level of cash to meet upcoming liabilities is a good sign for its financial health. This indicates that CTB has sufficient cash flows and proper cash management in place, which is a key determinant of the company’s health. CTB appears to have made good use of debt, producing operating cash levels of 0.75x total debt in the prior year. This is a strong indication that debt is reasonably met with cash generated. CTB's share price is trading at below its true value, meaning that the market sentiment for the stock is currently bearish. Investors have the opportunity to buy into the stock to reap capital gains, if CTB's projected earnings trajectory does follow analyst consensus growth, which determines my intrinsic value of the company. Also, relative to the rest of CTB's peers, it is also trading at a value below those of similar sizes in asset terms. This bolsters the proposition that CTB's price is currently discounted.
For Cooper Tire & Rubber, I've put together three pertinent aspects you should further examine:
- Future Outlook: What are well-informed industry analysts predicting for CTB’s future growth? Take a look at our free research report of analyst consensus for CTB’s outlook.
- Historical Performance: What has CTB'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 CTB? 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 firstname.lastname@example.org. 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.