- By GF Value
The stock of AP (Thailand) PCL (BKK:AP, 30-year Financials) gives every indication of being fairly valued, according to GuruFocus Value calculation. GuruFocus Value is GuruFocus' estimate of the fair value at which the stock should be traded. It is calculated based on the historical multiples that the stock has traded at, the past business growth and analyst estimates of future business performance. If the price of a stock is significantly above the GF Value Line, it is overvalued and its future return is likely to be poor. On the other hand, if it is significantly below the GF Value Line, its future return will likely be higher. At its current price of ?8.2 per share and the market cap of ?25.8 billion, AP (Thailand) PCL stock gives every indication of being fairly valued. GF Value for AP (Thailand) PCL is shown in the chart below.
Because AP (Thailand) PCL is fairly valued, the long-term return of its stock is likely to be close to the rate of its business growth, which averaged 10.5% over the past three years and is estimated to grow 6.56% annually over the next three to five years.
Link: These companies may deliever higher future returns at reduced risk.
Since investing in companies with low financial strength could result in permanent capital loss, investors must carefully review a company's financial strength before deciding whether to buy shares. Looking at the cash-to-debt ratio and interest coverage can give a good initial perspective on the company's financial strength. AP (Thailand) PCL has a cash-to-debt ratio of 0.12, which ranks worse than 71% of the companies in Real Estate industry. Based on this, GuruFocus ranks AP (Thailand) PCL's financial strength as 5 out of 10, suggesting fair balance sheet. This is the debt and cash of AP (Thailand) PCL over the past years:
Companies that have been consistently profitable over the long term offer less risk for investors who may want to purchase shares. Higher profit margins usually dictate a better investment compared to a company with lower profit margins. AP (Thailand) PCL has been profitable 10 over the past 10 years. Over the past twelve months, the company had a revenue of ?29.9 billion and earnings of ?1.34 a share. Its operating margin is 11.14%, which ranks in the middle range of the companies in Real Estate industry. Overall, the profitability of AP (Thailand) PCL is ranked 8 out of 10, which indicates strong profitability. This is the revenue and net income of AP (Thailand) PCL over the past years: