Winnebago Industries Inc (NYSE:WGO) is a small cap company that operates within the automobile industry. Its market cap is $2 billion today and the total one-year return is 40.31% for shareholders.
Winnebago stock is beating the market, and it reports earnings soon. But does that make it a good buy today? To answer this question we've turned to the Investment U Stock Grader. Our research team built this system to diagnose the financial health of a company.
Our system looks at six key metrics...
✓ Earnings-per-Share (EPS) Growth: Winnebago reported a recent EPS growth rate of 45.83%. That's above the automobile industry average of 44.89%. That's a great sign. Winnebago's earnings growth is outpacing competitors.
✓ Price-to-Earnings (P/E): The average price-to-earnings ratio of the automobile industry is 69.64. And Winnebago's ratio comes in at 15.57. It's trading at a better value than many of its competitors.
✓ Debt-to-Equity : The debt-to-equity ratio for Winnebago stock is 56.74%. That's below the automobile industry average of 131.12%. That's a good sign. Winnebago's debt levels are not out of control.
✗ Free Cash Flow per Share Growth : Winnebago has decreased its FCF per share over the last year relative to its competitors. That's not good for investors. In general, if a company is growing its FCF, it will be able to pay down debt, buy back stock, pay out more in dividends and/or invest money back into the business to help boost growth.
✓ Profit Margins : The profit margin of Winnebago comes in at 4.72% today. And generally, the higher, the better. We also like to see this ratio above competitors. Winnebago's profit margin is above the automobile average of -15.24%. So that's a positive indicator for investors.
✓ Return on Equity : Return on equity tells us how much profit a company produces with the money shareholders invest. The ROE for Winnebago is 19.16% and that's above its industry average ROE of 8.79%.
Winnebago stock passes five of our six key metrics today. That's why our Investment U Stock Grader gives it a Strong Buy.