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UMS Holdings Limited (SGX:558) is a stock with outstanding fundamental characteristics. When we build an investment case, we need to look at the stock with a holistic perspective. In the case of 558, it is a financially-sound company with a a strong track record superior dividend payments, trading at a great value. Below, I've touched on some key aspects you should know on a high level. For those interested in understanding where the figures come from and want to see the analysis, take a look at the report on UMS Holdings here.
Excellent balance sheet, good value and pays a dividend
558'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 indicates that 558 has sufficient cash flows and proper cash management in place, which is a crucial insight into the health of the company. 558 appears to have made good use of debt, producing operating cash levels of 1.26x total debt in the prior year. This is a strong indication that debt is reasonably met with cash generated. 558's shares are now trading at a price below its true value based on its discounted cash flows, indicating a relatively pessimistic market sentiment. Investors have the opportunity to buy into the stock to reap capital gains, if 558's projected earnings trajectory does follow analyst consensus growth, which determines my intrinsic value of the company. Also, relative to the rest of its peers with similar levels of earnings, 558's share price is trading below the group's average. This further reaffirms that 558 is potentially undervalued.
558's high dividend payments make it one of the best dividend stocks on the market, and its profitability ensures that dividends are well-covered by its net income.
Next Steps:
For UMS Holdings, I've compiled three essential aspects you should further examine:
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Future Outlook: What are well-informed industry analysts predicting for 558’s future growth? Take a look at our free research report of analyst consensus for 558’s outlook.
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Historical Performance: What has 558'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 558? Explore our interactive list of stocks with large potential to get an idea of what else is out there you may be missing!
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.