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Does The Data Make Design Hotels AG (FRA:LBA) An Attractive Investment?

Simply Wall St

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Attractive stocks have exceptional fundamentals. In the case of Design Hotels AG (FRA:LBA), there's is a company with great financial health as well as a a strong history of performance. In the following section, I expand a bit more on these key aspects. For those interested in digger a bit deeper into my commentary, take a look at the report on Design Hotels here.

Flawless balance sheet with solid track record

In the previous year, LBA has ramped up its bottom line by 21%, with its latest earnings level surpassing its average level over the last five years. Not only did LBA outperformed its past performance, its growth also surpassed the Media industry expansion, which generated a -3.4% earnings growth. This is what investors like to see! LBA is financially robust, with ample cash on hand and short-term investments to meet upcoming liabilities. This implies that LBA manages its cash and cost levels well, which is an important determinant of the company’s health. Looking at LBA's capital structure, the company has no debt on its balance sheet. It has only utilized funding from its equity capital to run the business, which is typically normal for a small-cap company. Investors’ risk associated with debt is virtually non-existent and the company has plenty of headroom to grow debt in the future, should the need arise.

DB:LBA Income Statement, May 31st 2019

Next Steps:

For Design Hotels, I've put together three relevant factors you should further examine:

  1. Future Outlook: What are well-informed industry analysts predicting for LBA’s future growth? Take a look at our free research report of analyst consensus for LBA’s outlook.
  2. Valuation: What is LBA 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 LBA is currently mispriced by the market.
  3. Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of LBA? 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 editorial-team@simplywallst.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.