Looking At Varian Medical Systems, Inc. (NYSE:VAR) From All Angles
I've been keeping an eye on Varian Medical Systems, Inc. (NYSE:VAR) because I'm attracted to its fundamentals. Looking at the company as a whole, as a potential stock investment, I believe VAR has a lot to offer. Basically, it is a financially-robust company with a great history and a buoyant growth outlook. In the following section, I expand a bit more on these key aspects. If you're interested in understanding beyond my broad commentary, read the full report on Varian Medical Systems here.
Flawless balance sheet with proven track record
VAR is an attractive stock for growth-seeking investors, with an expected earnings growth of 21% in the upcoming year, bolstered by its impressive cash-generating ability, as analysts predict its operating cash flows will rise by 71% over the same time period. This is a sustainable driver of high-quality earnings, as opposed to pure cost-cutting activities. VAR delivered a triple-digit bottom-line expansion over the past couple of years, with its most recent earnings level surpassing its average level over the last five years. In addition to beating its historical values, VAR also outperformed its industry, which delivered a growth of 27%. This is an optimistic signal for the future.
VAR's ability to maintain an adequate level of cash to meet upcoming liabilities is a good sign for its financial health. This implies that VAR manages its cash and cost levels well, which is a crucial insight into the health of the company. VAR's has produced operating cash levels of 0.84x total debt over the past year, which implies that VAR's management has put its borrowings into good use by generating enough cash to cover a sufficient portion of borrowings.
Next Steps:
For Varian Medical Systems, I've compiled three relevant factors you should further research:
Valuation: What is VAR 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 VAR is currently mispriced by the market.
Dividend Income vs Capital Gains: Does VAR 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 VAR as an investment.
Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of VAR? 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.
