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Attractive stocks have exceptional fundamentals. In the case of Apiam Animal Health Limited (ASX:AHX), there's is a company with strong financial health as well as a buoyant future outlook. Below, I've touched on some key aspects you should know on a high level. If you're interested in understanding beyond my broad commentary, read the full report on Apiam Animal Health here.

Reasonable growth potential with adequate balance sheet

One reason why investors are attracted to AHX is its earnings growth potential in the near future of 32%, made up of high-quality, operational cash from its core business, which is expected to increase by 52% next year. This indicates a high-quality bottom-line expansion, as opposed to those driven by unsustainable cost-cutting activities. AHX'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 indicates that AHX has sufficient cash flows and proper cash management in place, which is a key determinant of the company’s health. AHX's has produced operating cash levels of 0.24x total debt over the past year, which implies that AHX's management has put its borrowings into good use by generating enough cash to cover a sufficient portion of borrowings.

Next Steps:

For Apiam Animal Health, I've compiled three fundamental factors you should further research:

1. Historical Performance: What has AHX'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 AHX 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 AHX is currently mispriced by the market.

3. Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of AHX? 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.