Stock on Focus: Party City Holdco Inc. (PRTY)

Company Profile:

Party City Holdco Inc., through its subsidiaries, designs, manufactures, sources, and distributes party supplies in the United States and internationally. The company operates in two segments, Retail and Wholesale. It offers paper and plastic tableware, accessories and novelties, metallic and latex balloons, Halloween and other costumes, decorations, and stationery and gift items. As of March 9, 2017, the company offered its products through its 900 specialty retail party supply stores, including approximately 160 franchise stores in North America under the Party City and Halloween City names; and e-commerce Websites, principally through the domain name PartyCity.com. In addition, it franchises individual stores and franchise areas throughout the United States, Mexico, and Puerto Rico principally under the Party City name. The company offers its products through company-owned stores, independent party supply stores, mass merchants, grocery retailers, and dollar stores, as well as through other retailers and distributors. Party City Holdco Inc. was founded in 1947 and is headquartered in Rockaway, New Jersey.

Recent News:

The company delivered strong second quarter revenue growth of 4.9% on a reported basis or 5.7% on a constant currency basis. Net income was $25.0 million compared to $22.5 million in the second quarter of 2016.

For the first quarter ended March 31, 2017, the company reported total revenues increased 4.2% on a reported basis or 4.8% on a constant currency basis. Net loss was $4.7 million compared to a net loss of $0.4 million in the first quarter of 2016.

 

Fundamental Analysis:

Ninestocks analyzes several different financial aspects: Growth, Profitability, solvency and efficiency.

Growth – Measures the growth of both the company’s income statement and cash flow.

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Profitability – Measures the historical price movement of the stock.

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Solvency – Measures the solvency of the company based on several ratios.

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Efficiency – Measures the strength and historic growth of a company’s return on invested capital.

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Conclusion:

PRTY’s strengths can be seen in its strong growth, better profitability and better efficiency compared with its peers. Its revenue and net income have increased over several years. Technical indicators signal the bullish signs, as there is a bullish cross in MACD and Stochastic Oscillator. RSI(14) stands at 51.61 with positive bias. We rate Party City Holdco Inc. (PRTY) a STRONG BUY.

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