Euronet Worldwide, Inc. (NASDAQ:EEFT) is a stock with outstanding fundamental characteristics. When we build an investment case, we need to look at the stock with a holistic perspective. In the case of EEFT, it is a financially-robust company with an impressive history and a excellent future 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 Euronet Worldwide here.
Proven track record with reasonable growth potential
One reason why investors are attracted to EEFT is its earnings growth potential in the near future of 20%, supported by its outstanding capacity to churn out cash from operating activities, which is predicted to ramp up by 55% next year. This indicates that earnings is driven by top-line activity rather than purely unsustainable cost-reduction initiatives. Over the past year, EEFT has grown its earnings by 80%, with its most recent figure exceeding its annual average over the past five years. Not only did EEFT outperformed its past performance, its growth also exceeded the IT industry expansion, which generated a 9.8% earnings growth. This paints a buoyant picture for the company.
EEFT'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 suggests prudent control over cash and cost by management, which is an important determinant of the company’s health. EEFT appears to have made good use of debt, producing operating cash levels of 0.34x total debt in the prior year. This is a strong indication that debt is reasonably met with cash generated.
For Euronet Worldwide, I've put together three pertinent aspects you should look at:
- Valuation: What is EEFT 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 EEFT is currently mispriced by the market.
- Dividend Income vs Capital Gains: Does EEFT 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 EEFT as an investment.
- Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of EEFT? 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.