Virtu Financial, Inc. (NASDAQ:VIRT) 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 VIRT, it is a financially-sound company with a a great history of performance, trading at a discount. 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, read the full report on Virtu Financial here.
Very undervalued with proven track record and pays a dividend
In the past couple of years, VIRT has ramped up its bottom line by over 100%, with its latest earnings level surpassing its average level over the last five years. In addition to beating its historical values, VIRT also outperformed its industry, which delivered a growth of 37%. This is what investors like to see! VIRT is financially robust, with ample cash on hand and short-term investments to meet upcoming liabilities. This implies that VIRT manages its cash and cost levels well, which is a crucial insight into the health of the company. VIRT seems to have put its debt to good use, generating operating cash levels of 0.3x 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.
VIRT's share price is trading at below its true value, meaning that the market sentiment for the stock is currently bearish. According to my intrinsic value of the stock, which is driven by analyst consensus forecast of VIRT's earnings, investors now have the opportunity to buy into the stock to reap capital gains. Also, relative to the rest of its peers with similar levels of earnings, VIRT's share price is trading below the group's average. This bolsters the proposition that VIRT's price is currently discounted.
For Virtu Financial, I've put together three important aspects you should further research:
- Future Outlook: What are well-informed industry analysts predicting for VIRT’s future growth? Take a look at our free research report of analyst consensus for VIRT’s outlook.
- Dividend Income vs Capital Gains: Does VIRT 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 VIRT as an investment.
- Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of VIRT? 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.