In This Article:
- By GF Value
The stock of Columbia Sportswear Co (NAS:COLM, 30-year Financials) appears to be modestly overvalued, 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 $107.75 per share and the market cap of $7.2 billion, Columbia Sportswear Co stock is estimated to be modestly overvalued. GF Value for Columbia Sportswear Co is shown in the chart below.
Because Columbia Sportswear Co is relatively overvalued, the long-term return of its stock is likely to be lower than its business growth, which averaged 2.3% over the past three years and is estimated to grow 3.79% 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. Columbia Sportswear Co has a cash-to-debt ratio of 1.89, which is better than 74% of the companies in the industry of Manufacturing - Apparel & Accessories. The overall financial strength of Columbia Sportswear Co is 8 out of 10, which indicates that the financial strength of Columbia Sportswear Co is strong. This is the debt and cash of Columbia Sportswear Co 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. Columbia Sportswear Co has been profitable 10 over the past 10 years. Over the past twelve months, the company had a revenue of $2.5 billion and earnings of $1.623 a share. Its operating margin is 5.48%, which ranks better than 67% of the companies in the industry of Manufacturing - Apparel & Accessories. Overall, the profitability of Columbia Sportswear Co is ranked 8 out of 10, which indicates strong profitability. This is the revenue and net income of Columbia Sportswear Co over the past years: