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Attractive stocks have exceptional fundamentals. In the case of I.T Limited (HKG:999), there’s is a financially-robust company with a a strong history of performance, 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, read the full report on I.T here.
Flawless balance sheet with solid track record and pays a dividend
In the previous year, 999 has ramped up its bottom line by 44%, with its latest earnings level surpassing its average level over the last five years. Not only did 999 outperformed its past performance, its growth also exceeded the Specialty Retail industry expansion, which generated a 28% earnings growth. This is an notable feat for the company. 999’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 999 manages its cash and cost levels well, which is an important determinant of the company’s health. 999’s has produced operating cash levels of 0.77x total debt over the past year, which implies that 999’s management has put its borrowings into good use by generating enough cash to cover a sufficient portion of borrowings.
999’s shares are now trading at a price below its true value based on its discounted cash flows, indicating a relatively pessimistic market sentiment. According to my intrinsic value of the stock, which is driven by analyst consensus forecast of 999’s earnings, investors now have the opportunity to buy into the stock to reap capital gains. Also, relative to the rest of HK companies with similar levels of earnings, 999’s share price is trading below the group’s average. This bolsters the proposition that 999’s price is currently discounted.
Next Steps:
For I.T, I’ve put together three fundamental factors you should look at:
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Future Outlook: What are well-informed industry analysts predicting for 999’s future growth? Take a look at our free research report of analyst consensus for 999’s outlook.
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Dividend Income vs Capital Gains: Does 999 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 999 as an investment.
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Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of 999? 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. On rare occasion, data errors may occur. Thank you for reading.