Yahoo Finance Reasons Why I Like Thakral Corporation Ltd (SGX:AWI)
As an investor, I look for investments which does not compromise one fundamental factor for another. By this I mean, I look at stocks holistically, from their financial health to their future outlook. In the case of Thakral Corporation Ltd (SGX:AWI), it is a financially-sound company with a a strong track record of performance, trading at a discount. Below, I’ve touched on some key aspects you should know on a high level. If you’re interested in understanding beyond my high-level commentary, take a look at the report on Thakral here.
Undervalued with solid track record
In the past couple of years, AWI has ramped up its bottom line by over 100%, with its latest earnings level surpassing its average level over the last five years. The strong earnings growth is reflected in impressive double-digit 25.04% return to shareholders, which is what investors like to see! AWI’s strong financial health means that all of its upcoming liability payments are able to be met by its current cash and short-term investment holdings. This implies that AWI manages its cash and cost levels well, which is an important determinant of the company’s health. With a debt-to-equity ratio of 31.69%, AWI’s debt level is reasonable. This means that AWI’s capital structure strikes a good balance between low-cost debt funding and maintaining financial flexibility without overly restrictive terms of debt.
AWI is currently trading below its true value, which means the market is undervaluing the company’s expected cash flow going forward. This mispricing gives investors the opportunity to buy into the stock at a cheap price compared to the value they will be receiving, should analysts’ consensus forecast growth be correct. Compared to the rest of the retail distributors industry, AWI is also trading below its peers, relative to earnings generated. This further reaffirms that AWI is potentially undervalued.
Next Steps:
For Thakral, I’ve compiled three fundamental factors you should look at:
Future Outlook: What are well-informed industry analysts predicting for AWI’s future growth? Take a look at our free research report of analyst consensus for AWI’s outlook.
Dividend Income vs Capital Gains: Does AWI return gains to shareholders through reinvesting in itself and growing earnings, or redistribute a decent portion of earnings as dividends? Our historical dividend yield visualization quickly tells you what your can expect from AWI as an investment.
Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of AWI? Explore our interactive list of stocks with large potential to get an idea of what else is out there you may be missing!
To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned.
