I’ve been keeping an eye on Consun Pharmaceutical Group Limited (HKG:1681) because I’m attracted to its fundamentals. Looking at the company as a whole, as a potential stock investment, I believe 1681 has a lot to offer. Basically, it is a financially-sound company with a great history and a excellent future outlook. In the following section, I expand a bit more on these key aspects. For those interested in understanding where the figures come from and want to see the analysis, take a look at the report on Consun Pharmaceutical Group here.

Outstanding track record and undervalued

Investors seeking high cash growth potential should consider 1681, with forecasted operating cash flow growth of triple-digits in the upcoming year. This underlies the notable 23.7% return on equity over the next few years leading up to 2021. 1681 delivered a bottom-line expansion of 24.1% in the prior year, with its most recent earnings level surpassing its average level over the last five years. This strong performance generated a robust double-digit return on equity of 20.5%, which is what investors like to see!

1681’s ability to maintain an adequate level of cash to meet upcoming liabilities is a good sign for its financial health. This implies that 1681 manages its cash and cost levels well, which is an important determinant of the company’s health. 1681 seems to have put its debt to good use, generating operating cash levels of 0.56x total debt in the most recent year. This is also a good indication as to whether debt is properly covered by the company’s cash flows.

Next Steps:

For Consun Pharmaceutical Group, I’ve put together three fundamental aspects you should further research:

1. Valuation: What is 1681 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 1681 is currently mispriced by the market.

2. Dividend Income vs Capital Gains: Does 1681 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 1681 as an investment.

3. Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of 1681? 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.