Building up an investment case requires looking at a stock holistically. Today I’ve chosen to put the spotlight on Larsen & Toubro Infotech Limited (NSE:LTI) due to its excellent fundamentals in more than one area. LTI is a company with great financial health as well as a an impressive history of performance. Below, I’ve touched on some key aspects you should know on a high level. If you’re interested in understanding beyond my high-level commentary, read the full report on Larsen & Toubro Infotech here.
Flawless balance sheet with solid track record
LTI delivered a bottom-line expansion of 20.4% 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 29.6%, which is what investors like to see! LTI’s ability to maintain an adequate level of cash to meet upcoming liabilities is a good sign for its financial health. This implies that LTI manages its cash and cost levels well, which is a key determinant of the company’s health. Investors should not worry about LTI’s debt levels because the company has none! It has only utilized funding from its equity capital to run the business, which is rather impressive for a ₹331.73b market cap company. LTI has plenty of financial flexibility, without debt obligations to meet in the short term, as well as the headroom to raise debt should it need to in the future.
Next Steps:
For Larsen & Toubro Infotech, I’ve compiled three pertinent factors you should further examine:
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Future Outlook: What are well-informed industry analysts predicting for LTI’s future growth? Take a look at our free research report of analyst consensus for LTI’s outlook.
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Valuation: What is LTI 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 LTI is currently mispriced by the market.
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Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of LTI? 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.