In This Article:
- By GF Value
The stock of Citrix Systems (NAS:CTXS, 30-year Financials) appears to be modestly undervalued, according to GuruFocus Value calculation. GuruFocus Value is GuruFocus' estimate of the fair value at which the stock should be traded. It is calculated based on the historical multiples that the stock has traded at, the past business growth and analyst estimates of future business performance. If the price of a stock is significantly above the GF Value Line, it is overvalued and its future return is likely to be poor. On the other hand, if it is significantly below the GF Value Line, its future return will likely be higher. At its current price of $119.2 per share and the market cap of $14.8 billion, Citrix Systems stock shows every sign of being modestly undervalued. GF Value for Citrix Systems is shown in the chart below.
Because Citrix Systems is relatively undervalued, the long-term return of its stock is likely to be higher than its business growth, which averaged 12.2% over the past three years and is estimated to grow 6.29% annually over the next three to five years.
Link: These companies may deliever higher future returns at reduced risk.
It is always important to check the financial strength of a company before buying its stock. Investing in companies with poor financial strength have a higher risk of permanent loss. Looking at the cash-to-debt ratio and interest coverage is a great way to understand the financial strength of a company. Citrix Systems has a cash-to-debt ratio of 0.46, which is worse than 81% of the companies in Software industry. The overall financial strength of Citrix Systems is 5 out of 10, which indicates that the financial strength of Citrix Systems is fair. This is the debt and cash of Citrix Systems over the past years:
Companies that have been consistently profitable over the long term offer less risk for investors who may want to purchase shares. Higher profit margins usually dictate a better investment compared to a company with lower profit margins. Citrix Systems has been profitable 9 over the past 10 years. Over the past twelve months, the company had a revenue of $3.2 billion and earnings of $4 a share. Its operating margin is 19.18%, which ranks better than 87% of the companies in Software industry. Overall, the profitability of Citrix Systems is ranked 9 out of 10, which indicates strong profitability. This is the revenue and net income of Citrix Systems over the past years: