Red Hat Stock Analysis (NYSE:RHT)
Red Hat Analysis Video
View Red Hat stock analysis video. This is our RHT analyst opinion covering the buy and sell arguments for RHT stock.
Red Hat Inc Stock Rating (3.4/5)
Our Red Hat stock opinion is based on fundamentals of the company. This Red Hat stock analysis is based on latest Q1 earnings for 2018. The stock price analysis takes into account a company's valuation metrics.
Should you buy RHT stock?
- Red Hat's revenue growth came in at 19.2% in 2018 Q1.
- The TTM operating margin was good at 13.7% for Red Hat.
- Net margins came in at average 10.5% for Red Hat over the last twelve months.
- The company has an operating cash flow which is 3.5 times the net income.
- Red Hat generates a high return on invested capital of 39%.
- Return On Equity (ROE) which is a measure of the company's profitability, looks great for Red Hat at 20.5%.
- The company has a healthy free cash flow margin of 34.3%.
Should you sell RHT stock?
- Red Hat is debt laden and has a high debt/equity ratio of 0.58.
- Trading at a PE ratio of 61.4, RHT stock is overvalued in comparison to industry average multiple of 26.6.
- RHT stock is trading at a PS multiple of 7, which is a negative when compared to the Computer-Software industry average multiple of 2.8.