Should You Be Holding Qudian Inc (NYSE:QD)?
Qudian Inc (NYSE:QD) 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 QD, it is a financially-healthy company with a strong history and an optimistic future outlook. Below, I’ve touched on some key aspects you should know on a high level. If you’re interested in understanding beyond my high-level commentary, read the full report on Qudian here.
Exceptional growth potential and undervalued
Bullish market analysts are forecasting fast-growing QD to deliver an exceptional triple-digit sales growth rate over the next year. This is expected to flow down into an impressive return on equity of 23.10% over the next couple of years. Over the past year, QD has grown its earnings by 97.09%, with its most recent figure exceeding its annual average over the past five years. This illustrates a strong track record, leading to a satisfying return on equity of 20.47%. which is what investors like to see!
QD’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 suggests prudent control over cash and cost by management, which is an important determinant of the company’s health. QD seems to have put its debt to good use, generating operating cash levels of 0.47x 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.
Next Steps:
For Qudian, I’ve put together three important aspects you should look at:
Valuation: What is QD 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 QD is currently mispriced by the market.
Dividend Income vs Capital Gains: Does QD 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 QD as an investment.
Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of QD? 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 pass 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.
