Should AVEVA Group plc (LON:AVV) Be Your Next Stock Pick?

As an investor, I look for investments which does not compromise one fundamental factor for another. By this I mean, I look at stocks holistically, from their financial health to their future outlook. In the case of AVEVA Group plc (LON:AVV), it is a company with impressive financial health as well as a excellent growth outlook. In the following section, I expand a bit more on these key aspects. For those interested in digger a bit deeper into my commentary, read the full report on AVEVA Group here.

Excellent balance sheet with reasonable growth potential

Investors in search for stocks with room to flourish should look no further than AVV, with its expected earinngs growth of 40%, made up of high-quality, operational cash from its core business, which is expected to more than double over the next year. This indicates a high-quality bottom-line expansion, as opposed to those driven by unsustainable cost-cutting activities. AVV’s ability to maintain an adequate level of cash to meet upcoming liabilities is a good sign for its financial health. This suggests prudent control over cash and cost by management, which is a key determinant of the company’s health. AVV seems to have put its debt to good use, generating operating cash levels of 6.73x 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.

LSE:AVV Future Profit January 16th 19

Next Steps:

For AVEVA Group, there are three pertinent factors you should look at:

1. Historical Performance: What has AVV’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.

2. Valuation: What is AVV 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 AVV is currently mispriced by the market.

3. Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of AVV? Explore our interactive list of stocks with large potential to get an idea of what else is out there you may be missing!

To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.

The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.