I've been keeping an eye on Malibu Boats, Inc. (NASDAQ:MBUU) because I'm attracted to its fundamentals. Looking at the company as a whole, as a potential stock investment, I believe MBUU has a lot to offer. Basically, it is a financially-healthy company with a strong history and a buoyant growth outlook. In the following section, I expand a bit more on these key aspects. For those interested in understanding where the figures come from and want to see the analysis, take a look at the report on Malibu Boats here.
Outstanding track record and undervalued
Investors in search for stocks with room to flourish should look no further than MBUU, with its expected earinngs growth of 21%, supported by its outstanding capacity to churn out cash from operating activities, which is predicted to ramp up by 73% next year. This indicates that earnings is driven by top-line activity rather than purely unsustainable cost-reduction initiatives. Over the past few years, MBUU has more than doubled its earnings, with its most recent figure exceeding its annual average over the past five years. The strong earnings growth is reflected in impressive double-digit 34% return to shareholders, which is what investors like to see!
MBUU's ability to maintain an adequate level of cash to meet upcoming liabilities is a good sign for its financial health. This suggests prudent control over cash and cost by management, which is a crucial insight into the health of the company. MBUU 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.
For Malibu Boats, there are three key factors you should look at:
- Valuation: What is MBUU 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 MBUU is currently mispriced by the market.
- Dividend Income vs Capital Gains: Does MBUU 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 MBUU as an investment.
- Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of MBUU? 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.