Attractive stocks have exceptional fundamentals. In the case of adidas AG (FRA:ADS), there's is a financially-healthy , dividend-paying company with a an impressive history of performance. Below, I've touched on some key aspects you should know on a high level. For those interested in digger a bit deeper into my commentary, take a look at the report on adidas here.
Outstanding track record with excellent balance sheet and pays a dividend
ADS delivered a bottom-line expansion of 26% in the prior year, with its most recent earnings level surpassing its average level over the last five years. The strong earnings growth is reflected in impressive double-digit 27% return to shareholders, which is what investors like to see! ADS is financially robust, with ample cash on hand and short-term investments to meet upcoming liabilities. This suggests prudent control over cash and cost by management, which is an important determinant of the company’s health. ADS's has produced operating cash levels of 1.5x total debt over the past year, which implies that ADS's management has put its borrowings into good use by generating enough cash to cover a sufficient portion of borrowings.
ADS is also a dividend company, with ample net income to cover its dividend payout, which has been consistently growing over the past decade, keeping income investors happy.
For adidas, I've put together three essential aspects you should further examine:
- Future Outlook: What are well-informed industry analysts predicting for ADS’s future growth? Take a look at our free research report of analyst consensus for ADS’s outlook.
- Valuation: What is ADS 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 ADS is currently mispriced by the market.
- Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of ADS? 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.