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Fundamental analysis: Despegar.com, Corp. (DESP)

Awarener score: 3.5

Conclusion

Note: All scores range from 1 (worst) to 10 (best). Conclusions are updated daily with closing stock prices and new reported quarterly financial statements.

Revenue score: 4.5

• Business has been growing at a good pace. It's been similar to peer companies.
• Despegar.com, Corp. business varies frequently, ups and downs are normal. It's risky. It looks mediocre against rivals.

Margins score: 3.8

• DESP profit margins -on goods and services sold- are usually very good. They stand slightly better than rival companies.
• Business profit on sales tends to be very poor. It's below average when measured against competitors.
• Profits on sales made -available to repay debt and purchase properties- are usually very poor. They remain lacking compared to peers.
• Earnings -before income taxes and interests on loans taken- tend to be very poor in relation to total revenues. They're still slightly worse than similar companies.
• Profits -before income taxes- are usually very poor considering total sales, and remain similar to rivals.
• Total net profit tends to be very poor when confronted to sales. Company stands similar to comparable firms.

Growth score: 2.0

• Despegar.com, Corp. profit -on goods and services sold- has been growing at a very good pace. It's been rather normal in relation to competitors.
• In recent years, the firm hasn't always been able to profit from operations, which has been bottom tier against comparable firms.
• In past years, the company couldn't always turn a profit -available to repay debt and purchase properties-, which compares last-in-rank when measured against peer enterprises.
• In the previous years, the firm couldn't always make a profit -before income taxes and interests on loans taken-. It turns to be a disappointment compared to similar stocks.
• In past years, at least once the company lost money -before income taxes-. It was bottom tier against rivals.
• In the previous years, the firm had at least a total net loss, and last-in-rank when measured against peer companies.
• The company lost money at least once in the past years. It's been a disappointment compared to industry peers.

Miscellaneous score: 4.3

• DESP had still to pay income taxes, even though in recent past years mostly lost money. It's been bottom tier against peers.
• Research and development expenses consume a moderate portion of revenues. It's substantially worse when measured against competitors.
• The company grows modestly in relation to research and development efforts. It stands in a very weak position compared to rival companies.

Profitability score: 4.0

• Despegar.com, Corp. usually gets low returns on the resources it controls. It proves substantially worse when measured against peer firms.
• Due to insufficient track history, we were unable to estimate typical returns on invested capital (ROIC). They remain undisclosed in relation to similar companies.
• Normal return on equity (ROE) is unavailable at this time, because of not enough yearly inputs to calculate. It ranks unknown against competitors.
• In the past, got low returns -on the tangible resources it controls-. This metric is usually related to the industry in which operates and combines profitability versus reinvestment needs. It's substantially worse when measured against comparable enterprises.

Usage of Funds score: 4.4

• DESP on average doesn't generate genuine funds, so to buy or replace property, plants and equipment must either burn existing cash or increase debt. It stands substantially worse when measured against rival firms.
• The company is usually somewhat investing in new property, plant, and equipment, to improve its operating capabilities, which is similar to industry peers.
• In the past twelve months it paid some dividends, considering the current stock price. It came somewhat worse than competitors.
• Has greatly increased dividend payments in the past years. Business prospects are most likely good. The company has behaved a slight improvement compared to similar firms.
• The company generates very few genuine funds. Dividend payments are usually on borrowed money, which isn't sustainable in the long run. Unless business prospects improve greatly, future payments could be at risk. Sustainability looks bottom tier against comparable companies.
• The company usually enlarges quite a bit the pool of investors, resulting in more mouths feeding on the pie of profits. It remains in a very weak position compared to peer enterprises.
• Repurchase effectiveness metric is very complex. Run again in analytical mode if you're interested in a technical explanation. It stands in a very weak position compared to rivals.
• We do not have sufficient data to comment on buybacks and their sustainability. It still looks dubious against competitors.

Balance Sheet score: 5.3

• Despegar.com, Corp. has not disclosed intangibles assets, so we could not reach a meaningful conclusion on this metric. It happens to be a not known variable when measured with peer companies.
• The company has somewhat lower short-term resources than short-term obligations. Unless it's part of the business model, there might some liquidity concerns. It turns to be lacking compared to similar firms.
• A very minor portion of resources controlled were provided for with financial debt. Financial strength is solid. Company could increase debt if it wished so, to reinvest in business, to buy a smaller company or to reward stockholders. It remains better than most rival firms.
• Controlled resources can be made into cash within reason, which is quite good for liquidity. It looks more than average in relation to rivals.
• For every dollar of short-term obligations, the company has almost another of cash and short-term receivables. It's close to average when compared to peer firms.
• For every dollar of short-term obligations, the company has almost another of cash and equivalents, which is somewhat worse than similar enterprises.
• Usually, sales are on many months credit. It still ranks last-in-rank when measured against peers.
• Normally has no inventories. It comes up as impressive in relation to competitors.
• On average, it takes higher than six months from the purchase to charging customers. It happens to be worse than most peers.
• On average pays suppliers many months after the purchase. It ranks great when measured against industry peers.
• The company charges its customers long before it must pay its suppliers, so the more it sales, the more free funds it gets. It's excellent in relation to similar companies.
• To what extent normalized EBITDA covers interest expenses is not known. It stands impossible to compare against rival firms.
• Business has usually been operated at a loss. Unless prospects improve, the company is no position to decrease loans taken levels but by additional shareholders' funding. Profitability must improve. It ranks last-in-rank when measured against comparable enterprises.
• Revenues are quite good in relation to property, plant, and equipment required to operate. This metric is likely dependent on the industry the company operates in. The more property, plant, and equipment used, the more the company must reinvest to fight obsolescence, which usually means less available funds for the shareholders in the long run. It looks rather normal in relation to similar firms.
• Resource exploitation is slightly low when yearly sales are considered, business volume should be increased. This metric is normally tied to the industry where the firm belongs. It's still somewhat worse than peer companies.

Valuation score: 2.8

• Despegar.com, Corp. reported losses, so valuating it in relation to earnings is meaningless. It happens to be last-in-rank when measured against competitors.
• Price-to-Tangible-Book-Value is a fairly complex metric. Run again in analytical mode if you're interested in a technical explanation. It remains a disappointment compared to peers.
• In the past twelve months, the company consumed funds. Either it reinvested significantly in the business or genuine fund generation might be struggling, which stands bottom tier against similar companies.
• The company usually consumes much more funds than can genuinely generate. Business needs are meet by borrowing money or consuming preexistent cash, which can only keep up until a certain limit. Unless the company is driving significant business growth, genuine profitability may be brought into question. It's still last-in-rank when measured against industry firms.
• In the past twelve months, the company has significantly enlarged the pool of investors by issuing new shares. Future profits need to be high enough to justify the measure, as the pie of earnings will now be split among numerous more stockholders. It came up in a very weak position compared to peer ventures.
• This company is a cash hoarder. It might be well poised to substantially increase stockholder payments, or to fund new business projects. It looks top-notch against similar enterprises.
• Considering the past twelve months, traditional Price-to-Earnings relation has been negative, as the company lost money. It ranks last-in-rank when measured against peer companies.
• Comparing the current stock price with the past twelve-months revenues gives a roughly two to one relationship. This is an important metric to check its evolution through time, and to compare to industry peers. It looks rather normal in relation to rival firms.
• There's no accounting equity, which may be good or bad depending on context. Run again in analytic mode if you want to dig deeper. The company remains bottom tier against peer firms.
• In the past twelve months, the operating business lost a lot of money. It happens to be last-in-rank when measured against industry peers.
• In an alternate metric of bang for the buck, the company has usually shown a low earnings power ability when measured against the current stock price and financial position. It's still a disappointment compared to peer companies.

Total score: 3.9

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Awarener score: 3.5

Conclusion

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