1. How to use GuruFocus - Tutorials
  2. What Is in the GuruFocus Premium Membership?
  3. A DIY Guide on How to Invest Using Guru Strategies
Alberto Abaterusso
Alberto Abaterusso
Articles (2195) 

3 Stocks Growing Capex Fast

Large spending to improve fixed assets may anticipate growth

June 17, 2020 | About:

The following companies have increased their allocations to capital expenditures substantially over the past five years. This may anticipate higher revenues, as these companies are likely predicting a rise in the demand for their goods and services in the near future.

Furthermore, Wall Street analysts expect these stocks to increase their earnings per share (EPS) significantly over the next five years, outperforming the S&P 500 index.

Digital Turbine Inc

The first company that has the above listed criteria is Digital Turbine Inc (NASDAQ:APPS), an Austin, Texas-based global provider of application software solutions to device application developers, original equipment manufacturers and mobile operators.

The company allocated $4.845 million to capex in full fiscal year 2020 (which ended on March 31), growing tremendously from $67,000 spent in full fiscal 2015.

Wall Street analysts predict that Digital Turbine’s EPS will gain 25% every year over the next five years, while the S&P 500’s EPS is expected to grow by 3% per year over the next five years. As of June, two analysts on Wall Street recommended a strong buy rating and three recommended a buy rating for the stock, establishing an average target share price of $11.21.

The stock price closed at $10.42 per share on Tuesday for a market capitalization of $909.96 million. The share price grew 131% over the past year.

The stock has a price-book ratio of 11.98 versus the industry median of 2.83 and a price-sales ratio of 6.53 versus the industry median of 2.18.

Exelixis Inc

The second company that has the above listed criteria is Exelixis Inc (NASDAQ:EXEL), an Alameda, California-based oncology-focused biotechnology company engaging in the commercialization of new therapies to treat cancer patients.

The company has allocated $12.834 million to capex in full fiscal year 2019, which represented an impressive growth versus $474,000 spent in full fiscal year 2014, hitting two peaks of $33.297 million in 2018 and $21.143 million in 2017.

Wall Street analysts predict that Exelixis’ EPS will grow by 46% every year over the next five years. As of June, one sell-side analyst on Wall Street recommended a strong buy, five analysts recommended a buy rating while four analysts recommended a hold rating for this stock. The average target price is $29.85 per share.

The stock price traded at $23.42 per share at close on Tuesday for a market capitalization of $7.18 billion. The share price increased by 12.8% over the past year.

The stock has a price-book ratio of 4.24 versus the industry median of 4.32 and a price-sales ratio of 7.53 versus the industry median of 15.99.

YETI Holdings Inc

The third company that has the above listed criteria is YETI Holdings Inc (NYSE:YETI), an Austin, Texas-based designer and retailer of outdoor and recreational products serving the North American, Japanese and Australian markets.

YETI Holdings’ allocation to capex grew by a yearly average of 46.5% over the past five years. The company invested $32.08 million for the acquisition of property, plant and equipment in full fiscal 2019, increasing dramatically from $3.82 million invested in full fiscal 2014. Capex peaked at $42.2 million in 2017.

YETI Holdings is now expected to increase its EPS by 20% every year over the next five years. As of June, six analysts recommended a strong buy rating and five analysts recommended a buy rating for this stock, giving it an average target price of $35.64 per share.

As a result of 32.5% growth over the past year, the stock price traded at $37.10 per share at close on Tuesday for a market capitalization is $3.23 billion.

The stock has a price-book ratio of 24.65 versus the industry median of 1.29 and a price-sales ratio of 3.45 versus the industry median of 1.28.

Disclosure: I have no positions in any securities mentioned.

Read more here:

Not a Premium Member of GuruFocus? Sign up for a free 7-day trial here

About the author:

Alberto Abaterusso
I am a contributor at GuruFocus. I primarily write about gold, silver and precious metals mining industries. My articles have also been widely linked by popular sites, including MarketWatch, Financial Times, 24hGold, Investopedia, Financial.org, CNBS, MSN Money, Zachs, Reuters and others. I hold a Master's Degree in Business Administration from Università degli Studi di Bari (Italy), Aldo Moro. I am based in The Netherlands.

You can follow me on Twitter at https://twitter.com/AAbaterusso

Rating: 0.0/5 (0 votes)

Comments

Please leave your comment:



Performances of the stocks mentioned by Alberto Abaterusso


User Generated Screeners


pjmason14Momentum
pascal.van.garsseHigh FCF-M2
kosalmmuse6
kosalmmuseBest one1
DBrizanall 2019Feb26
kosalmmuseBest one
DBrizanall 2019Feb25
kosalmmuseNice
kosalmmusehan
MsDale*52-Week Low
Get WordPress Plugins for easy affiliate links on Stock Tickers and Guru Names | Earn affiliate commissions by embedding GuruFocus Charts
GuruFocus Affiliate Program: Earn up to $400 per referral. ( Learn More)