Virtusa Stock Analysis, Valuation (NASDAQ:VRTU)

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$54.59 $0.05 (0.09%) VRTU stock closing price Aug 21, 2018 (Closing)

Investors can watch the Amigobulls Virtusa stock analysis video here. Our analyst opinion covering the buy and sell arguments for VRTU stock is shown in the video.

Note: Amigobulls stock rating is our opinion based on the historical performance of the company's fundamentals. It is not indicative of the future performance of the stock.

Virtusa Corporation Stock Rating 2.5/5

Amigobulls VRTU stock analysis takes into account various financial ratios like relative valuation, Virtusa revenue, growth and return on equity based on latest quarter 2019 Q1 financial statements. We also check Virtusa dividend performance. We compare Virtusa valuation with its sector peers to gauge relative attractiveness of VRTU stock. Our Virtusa stock rating is based on company's fundamentals like balance sheet risk and cash flow position.

Should you buy VRTU stock?

  • Virtusa sales grew by 32% year on year in 2018-06.
  • Revenue growth has been tremendous with a compounded annual growth of 25.8 over the last 5 years.
  • VRTU stock is trading at a favorable price to sales multiple of 1.4 as against the Computer and Technology sector average multiple of 2.9.

Should you sell VRTU stock?

  • Virtusa posted an average Net loss of -0.8% in the last twelve months.
  • Virtusa is debt laden and has a high debt/equity ratio of 0.57.
  • VRTU stock is trading at a PE ratio of 48.9, which is worse than the sector average multiple of 25.4.
  • Virtusa has a negative ROIC (Return on Invested Capital) of -0.3.
  • Virtusa has a negative ROE (Return On Equity) of -1.4, indicating the company is not profitable.
  • Virtusa has a negative FCF (Free Cash Flow) margin of -6.7.

Comments on this video and Virtusa stock

Investors can make use of the Amigobulls Virtusa stock analysis to ascertain how VRTU stock fares in fundamental analysis investment criteria. Fundamental analysis of a company is the most often used approach to find the intrinsic value of a stock.

While doing a study of the company financials, Virtusa revenue growth and profit or net income are two main metrics which help in identifying whether VRTU stock is overvalued or undervalued. One can also combine technical analysis and fundamental analysis to get a holistic picture about VRTU stock.