Friday, June 29, 2007

American Capital Strategies, Ltd.

American Capital Strategies, Ltd. is a high-yielding company with a forward-looking price to earnings ratio of just 12.21 times next year’s projected earnings. With a recent ticker price of $42.81, American Capital Strategies, Ltd. is ready for significant appreciation. The company’s operating profit margin is an impressive 71.28%. This results in an annual operating cash flow of $460.8M.

American Capital Strategies, Ltd. is a cash cow that has a reasonably attractive valuation. With a beta of 1.03, the company is more risky than the stock market as a whole. This information is useful, but a more careful analysis of American Capital Strategies, Ltd. reveals that the company’s risk profile is not as volatile as many of its competitors. It’s important to invest in a sufficiently liquid stock that money can be taken out of the position on every trading day and American Capital Strategies, Ltd.’s total market capitalization of $6.916B is ample proof of such liquidity.

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