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Is Encore Wire Corporation (NASDAQ:WIRE) Potentially Underrated?

Simply Wall St

As an investor, I look for investments which does not compromise one fundamental factor for another. By this I mean, I look at stocks holistically, from their financial health to their future outlook. In the case of Encore Wire Corporation (NASDAQ:WIRE), it is a company with great financial health as well as a a great history of performance. 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, take a look at the report on Encore Wire here.

Flawless balance sheet with proven track record

WIRE is financially robust, with ample cash on hand and short-term investments to meet upcoming liabilities. This indicates that WIRE has sufficient cash flows and proper cash management in place, which is a crucial insight into the health of the company. WIRE currently has no debt on its balance sheet. It has only utilized funding from its equity capital to run the business, which is typically normal for a small-cap company. Investors’ risk associated with debt is virtually non-existent and the company has plenty of headroom to grow debt in the future, should the need arise.

NasdaqGS:WIRE Income Statement, March 6th 2019
NasdaqGS:WIRE Income Statement, March 6th 2019

Next Steps:

For Encore Wire, I’ve put together three fundamental factors you should look at:

  1. Future Outlook: What are well-informed industry analysts predicting for WIRE’s future growth? Take a look at our free research report of analyst consensus for WIRE’s outlook.

  2. Valuation: What is WIRE 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 WIRE is currently mispriced by the market.

  3. Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of WIRE? 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.