OPERA LTD-ADR (NASDAQ:OPRA) Emerges as a Top Affordable Growth Stock Candidate

Opera Ltd-ADR (NASDAQ:OPRA) has appeared as a candidate in an "Affordable Growth" screening strategy, which targets companies showing strong growth, reasonable valuation, and good financial condition. This approach, often used by investors looking for growth at a reasonable price (GARP), seeks to find firms that mix expansion possibility with sensible pricing, lowering exposure to overvalued growth stocks while keeping a focus on fundamental strength.

Growth Path

OPRA shows strong growth metrics, a central need for any affordable growth selection. The company has shown important expansion in key areas:

• Revenue rose by 29.39% over the past year, with a compounded annual growth rate of 22.22% over several years.
• Earnings per share (EPS) have increased at an annualized rate of 29.22% historically, although recent yearly performance showed a drop of 47.55%.
• Future projections point to expected EPS growth of 17.17% and revenue growth of 14.66%, signaling continued, though moderating, expansion.

These figures highlight OPRA’s ability to scale operations and take market share, necessary for growth investing. The mix of historical performance and forward-looking estimates matches the screen’s focus on clear and continuing growth drivers.

Valuation Check

Valuation is important in affordable growth strategies to avoid overpaying for growth. OPRA’s valuation profile shows a mixed but generally positive picture:

• The forward P/E ratio of 14.86 compares well against industry averages and the broader S&P 500, suggesting relative undervaluation.
• Enterprise value to EBITDA and price-to-free cash flow ratios indicate OPRA is less expensive than 85% or more of its industry peers.
• Although the trailing P/E ratio of 18.95 seems high in isolation, it is contextually acceptable given growth expectations and industry position.

This combination of acceptable multiples and growth compensation makes OPRA attractive for investors who prioritize value-conscious growth exposure.

Financial Condition and Profitability

Financial condition ensures sustainability, while profitability confirms operational efficiency. OPRA scores well in health with a rating of 8/10, reflecting:

• A good current ratio of 2.43 and quick ratio of 2.43, showing enough short-term liquidity.
• Low debt levels, with a debt-to-equity ratio of 0.01 and good solvency metrics, including an Altman-Z score of 11.29.

Profitability, rated 6/10, is sufficient but shows area for improvement:

• Return on invested capital (ROIC) of 8.38% is better than 80.71% of industry peers.
• Operating margin of 16.45% is competitive, though margin reduction has been seen recently.

These factors lead to lowered financial risk and support the idea that the company can maintain its growth projects without risking stability.

Conclusion

OPRA represents a strong case for affordable growth investing, balancing clear growth prospects with acceptable valuation and durable fundamentals. Its capability to grow revenue notably while keeping financial condition aligns with the screen’s goal of finding well-rounded growth opportunities. For investors, this profile may provide a practical entry point into a growing company without high speculation.

For further exploration of stocks matching this criteria, additional selections can be reviewed through the Affordable Growth screening tool.

Disclaimer: This analysis is based on fundamental data and screening criteria and is for informational purposes only. It does not constitute investment advice or a recommendation to buy, sell, or hold any security. Investors should conduct their own research and consult with a financial advisor before making investment decisions.