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S.A.S. Dragon Holdings Limited (HKG:1184) 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 1184, it is a financially-healthy company with a a strong history of performance, trading at a great value. 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 S.A.S. Dragon Holdings here.

Undervalued with proven track record and pays a dividend

1184 delivered a satisfying double-digit returns of 7.0% in the most recent year Unsurprisingly, 1184 surpassed the industry return of 5.0%, which gives us more confidence of the company's capacity to drive earnings going forward. 1184'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 1184 manages its cash and cost levels well, which is an important determinant of the company’s health. 1184 appears to have made good use of debt, producing operating cash levels of 0.32x total debt in the prior year. This is a strong indication that debt is reasonably met with cash generated.

1184's share price is trading at below its true value, meaning that the market sentiment for the stock is currently bearish. Investors have the opportunity to buy into the stock to reap capital gains, if 1184's projected earnings trajectory does follow analyst consensus growth, which determines my intrinsic value of the company. Compared to the rest of the electronic industry, 1184 is also trading below its peers, relative to earnings generated. This further reaffirms that 1184 is potentially undervalued.

Next Steps:

For S.A.S. Dragon Holdings, I've compiled three fundamental aspects you should look at:

1. Future Outlook: What are well-informed industry analysts predicting for 1184’s future growth? Take a look at our free research report of analyst consensus for 1184’s outlook.

2. Dividend Income vs Capital Gains: Does 1184 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 1184 as an investment.

3. Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of 1184? 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.