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Attractive stocks have exceptional fundamentals. In the case of Shaver Shop Group Limited (ASX:SSG), there’s is a financially-sound company with a an impressive track record high-grade dividend payments, trading at a discount. Below is a brief commentary on these key aspects. If you’re interested in understanding beyond my broad commentary, take a look at the report on Shaver Shop Group here.
Very undervalued with flawless balance sheet and pays a dividend
SSG’s ability to maintain an adequate level of cash to meet upcoming liabilities is a good sign for its financial health. This suggests prudent control over cash and cost by management, which is an important determinant of the company’s health. SSG’s has produced operating cash levels of 1.37x total debt over the past year, which implies that SSG’s management has put its borrowings into good use by generating enough cash to cover a sufficient portion of borrowings. SSG is currently trading below its true value, which means the market is undervaluing the company’s expected cash flow going forward. Investors have the opportunity to buy into the stock to reap capital gains, if SSG’s projected earnings trajectory does follow analyst consensus growth, which determines my intrinsic value of the company. Compared to the rest of the specialty retail industry, SSG is also trading below its peers, relative to earnings generated. This bolsters the proposition that SSG’s price is currently discounted.
SSG is considered one of the top dividend payers in the market, and its profitability ensures that dividends are well-covered by its net income.
Next Steps:
For Shaver Shop Group, I’ve compiled three important factors you should further examine:
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Future Outlook: What are well-informed industry analysts predicting for SSG’s future growth? Take a look at our free research report of analyst consensus for SSG’s outlook.
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Historical Performance: What has SSG’s returns been like over the past? Go into more detail in the past track record analysis and take a look at the free visual representations of our analysis for more clarity.
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Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of SSG? 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 past 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. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.