5-Star Stocks Poised to Pop: Ebix

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Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, insurance-industry software specialist Ebix (NAS: EBIX) has earned a coveted five-star ranking.

With that in mind, let's take a closer look at Ebix's business and see what CAPS investors are saying about the stock right now.

Ebix facts

Headquarters (Founded)Atlanta (1976)
Market Cap$669 million
IndustryApplication software
Trailing-12-Month Revenue$160 million
ManagementChairman/CEO Robin Raina
CFO Robert Kerris
Return on Equity (Average, Past 3 Years)32.3%
Cash/Debt$15.6 million / $27.2 million
Dividend Yield0.9%

Sources: S&P Capital IQ and Motley Fool CAPS.

On CAPS, 97% of the 1,541 members who have rated Ebix believe the stock will outperform the S&P 500 going forward. These bulls include All-Stars cibient and ayaghsizian, both of whom are ranked in the top 15% of our community.

Just last week, CAPS All-Star cibient listed several of Ebix's positives: "Insider buys, growth stock ... (PEG ratio is purportedly 0.51), and pays a small dividend around 1%."

Over the next five years, in fact, Ebix is expected to grow its bottom line at a brisk rate of 20% annually. That's faster than much larger enterprise software plays like IBM (NYS: IBM) (11%), Microsoft (NAS: MSFT) (11%), and Oracle (NAS: ORCL) (14%).

CAPS All-Star ayaghsizian elaborates on the Ebix bull case:

The P/E is low and the PEG is so low it's ridiculous. This low valuation shows that the bad news surrounding this company has been priced into the stock. Worst case scenario -- price goes down over the next few years. ... Best case scenario -- bad news goes away and P/E ratio doubles or more due to great earnings growth and stock trades in the $40's in a couple years. I'm willing to take the risk.

What do you think about Ebix, or any other stock for that matter? If you want to retire rich, you need to put together the best portfolio you can. Owning exceptional stocks is a surefire way to secure your financial future, and on Motley Fool CAPS, thousands of investors are working every day to find them. CAPS is 100% free, so get started!

Interested in another easy way to trackEbix?Add it to your watchlist.

At the time this article was published Fool contributor Brian Pacampara owns no position in any of the companies mentioned. The Fool owns shares of Ebix, IBM, Oracle, and Microsoft. Motley Fool newsletter services have recommended buying shares of Ebix and Microsoft, as well as creating a bull call spread position in Microsoft. Try any of our Foolish newsletter services free for 30 days.We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Fool's disclosure policy always gets a perfect score.

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