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Attractive stocks have exceptional fundamentals. In the case of Weidai Ltd. (NYSE:WEI), there's is a company that has been able to sustain great financial health, trading at an attractive share price. Below, I've touched on some key aspects you should know on a high level. If you're interested in understanding beyond my broad commentary, take a look at the report on Weidai here.
Good value with adequate balance sheet
WEI's ability to maintain an adequate level of cash to meet upcoming liabilities is a good sign for its financial health. This implies that WEI manages its cash and cost levels well, which is a key determinant of the company’s health. WEI's has produced operating cash levels of 0.83x total debt over the past year, which implies that WEI's management has put its borrowings into good use by generating enough cash to cover a sufficient portion of borrowings. WEI's share price is trading at below its true value, meaning that the market sentiment for the stock is currently bearish. Investors have the opportunity to buy into the stock to reap capital gains, if WEI's projected earnings trajectory does follow analyst consensus growth, which determines my intrinsic value of the company. Also, relative to the rest of its peers with similar levels of earnings, WEI's share price is trading below the group's average. This further reaffirms that WEI is potentially undervalued.
For Weidai, I've compiled three relevant factors you should further examine:
- Future Outlook: What are well-informed industry analysts predicting for WEI’s future growth? Take a look at our free research report of analyst consensus for WEI’s outlook.
- Historical Performance: What has WEI'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.
- Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of WEI? 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 email@example.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.