In This Article:
TK Group (Holdings) Limited (HKG:2283) is a company with exceptional fundamental characteristics. Upon building up an investment case for a stock, we should look at various aspects. In the case of 2283, it is a financially-healthy company with a strong track record and an optimistic growth outlook. Below is a brief commentary on these key aspects. If you’re interested in understanding beyond my high-level commentary, take a look at the report on TK Group (Holdings) here.
Outstanding track record with excellent balance sheet
2283 is expected to churn out cash in the short term, with its operating cash flow predicted to expand by 59%. This underlies the notable 36% return on equity over the next few years leading up to 2021. 2283 delivered a bottom-line expansion of 40% in the prior year, with its most recent earnings level surpassing its average level over the last five years. The strong earnings growth is reflected in impressive double-digit 35% return to shareholders, which is an notable feat for the company.
2283’s ability to maintain an adequate level of cash to meet upcoming liabilities is a good sign for its financial health. This implies that 2283 manages its cash and cost levels well, which is a key determinant of the company’s health. 2283 appears to have made good use of debt, producing operating cash levels of 2.31x total debt in the prior year. This is a strong indication that debt is reasonably met with cash generated.
Next Steps:
For TK Group (Holdings), there are three relevant aspects you should further examine:
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Valuation: What is 2283 worth today? Is the stock undervalued, even when its growth outlook is factored into its intrinsic value? The intrinsic value infographic in our free research report helps visualize whether 2283 is currently mispriced by the market.
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Dividend Income vs Capital Gains: Does 2283 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 2283 as an investment.
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Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of 2283? 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.