I've been keeping an eye on Momo Inc. (NASDAQ:MOMO) because I'm attracted to its fundamentals. Looking at the company as a whole, as a potential stock investment, I believe MOMO has a lot to offer. Basically, it is a company with impressive financial health as well as a buoyant growth outlook. Below is a brief commentary on these key aspects. For those interested in understanding where the figures come from and want to see the analysis, read the full report on Momo here.
High growth potential with adequate balance sheet
Investors in search for stocks with room to flourish should look no further than MOMO, with its expected earnings growth of 25% which is expected to flow into an impressive return on equity of 22% over the next couple of years. MOMO'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 MOMO manages its cash and cost levels well, which is an important determinant of the company’s health. MOMO appears to have made good use of debt, producing operating cash levels of 0.84x total debt in the prior year. This is a strong indication that debt is reasonably met with cash generated.
For Momo, there are three pertinent factors you should further examine:
- Historical Performance: What has MOMO's returns been like over the past? Go into more detail in the past track record analysis and take a look at the free visual representations of our analysis for more clarity.
- Valuation: What is MOMO 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 MOMO is currently mispriced by the market.
- Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of MOMO? 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.