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These Factors Make Stoneridge, Inc. (NYSE:SRI) An Interesting Investment

Simply Wall St

Stoneridge, Inc. (NYSE:SRI) is a company with exceptional fundamental characteristics. Upon building up an investment case for a stock, we should look at various aspects. In the case of SRI, it is a company with great financial health as well as a a great history of performance. In the following section, I expand a bit more on these key aspects. If you're interested in understanding beyond my broad commentary, take a look at the report on Stoneridge here.

Flawless balance sheet with solid track record

Over the past few years, SRI has demonstrated a proven ability to generate robust returns of 27%. Unsurprisingly, SRI surpassed the Auto Components industry return of 15%, which gives us more confidence of the company's capacity to drive earnings going forward. SRI'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 SRI manages its cash and cost levels well, which is a crucial insight into the health of the company. SRI seems to have put its debt to good use, generating operating cash levels of 0.56x 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.

NYSE:SRI Income Statement, October 1st 2019

Next Steps:

For Stoneridge, I've compiled three essential factors you should look at:

  1. Future Outlook: What are well-informed industry analysts predicting for SRI’s future growth? Take a look at our free research report of analyst consensus for SRI’s outlook.
  2. Valuation: What is SRI 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 SRI is currently mispriced by the market.
  3. Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of SRI? 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.