Ubiquiti Inc (NYSE:UI) Excels on Key Growth Screens from The Little Book That Makes You Rich

Growth investing methods often depend on finding companies with solid fundamental momentum, and one organized system comes from Louis Navellier's "The Little Book That Makes You Rich." This system uses eight particular rules to identify stocks with better growth traits, concentrating on earnings revisions, sales growth, margin improvement, and profitability measures. The method intends to find companies showing speeding up business performance before these gains are completely represented in their stock prices.

Fitting the Little Book Requirements

Ubiquiti Inc (NYSE:UI) shows solid agreement with Navellier's growth screening system in several aspects. The company's recent results indicate notable momentum in important fundamental areas that growth investors usually look for.

The screening requirements and Ubiquiti's matching results include:

• Positive Earnings Revisions: Analyst EPS estimates for the next quarter have been adjusted higher by 36.7% over the last three months, showing increasing confidence in short-term results
• Positive Earnings Surprises: The company has surpassed EPS estimates in all of the previous four quarters, with an average exceedance of 30.1%
• Rising Sales Growth: Revenue has increased 36.8% year-over-year with quarterly sales rising 33.3%
• Growing Operating Margins: Operating margins have grown by 25.9% over the last year
• Solid Cash Flow: Free cash flow has increased by a notable 537.1% each year
• Earnings Growth: EPS has risen 87.8% year-over-year with quarterly EPS increasing 61.7%
• Positive Earnings Momentum: Current quarterly EPS growth of 61.7% is higher than the previous comparable quarter's growth of 45.6%
• High Return on Equity: The company reaches a remarkable ROE of 95.6%

These measurements together create an image of a company with solid operational momentum in many areas, which fits well with the growth traits Navellier's system aims to find.

Fundamental Evaluation Summary

Ubiquiti's full fundamental review shows a company with excellent profitability and financial condition, although its valuation is still high. The company gets a solid fundamental score of 7 out of 10, placing it well within the communications equipment sector.

Main advantages found in the review include remarkable profitability measurements, with return on assets of 53.1% and return on invested capital of 86.6% both positioned at the highest level of the industry. The company keeps good profit margins of 28.7% and functions with no existing debt, adding to very good solvency measures. Growth measurements indicate impressive recent results, although analysts forecast more measured growth in the future. The entire fundamental analysis report gives more detailed views into these measurements and their industry standings.

Investment Points

While Ubiquiti shows solid agreement with growth screening requirements, investors should think about a few elements. The company's valuation levels seem high compared to wider market averages, with a P/E ratio of 45.3 above the S&P 500 average. Still, this higher valuation could be reasonable given the company's exceptional profitability measurements and recent growth path.

The company's business model centers on networking equipment and software platforms for enterprises, service providers, and consumers. Its method of focusing on operator-owners of wireless internet services using a connected community of distributors and resellers has been successful in producing the solid sales growth shown in the screening outcomes.

For investors wanting to find comparable chances, other stocks meeting the Little Book requirements can be located using this screening results link.

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Disclaimer: This article provides factual information and review for learning purposes only and is not investment guidance, a suggestion, or support of any security. Investors must perform their own investigation and talk with financial consultants before making investment choices. Past results do not ensure future outcomes.