In This Article:
Xinyi Solar Holdings Limited (HKG:968) 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 968, it is a financially-robust company with a an impressive track record of performance, trading at a discount. Below is a brief commentary on these key aspects. For those interested in understanding where the figures come from and want to see the analysis, read the full report on Xinyi Solar Holdings here.
Solid track record and good value
968 has a strong track record of performance. In the previous year, 968 delivered an impressive double-digit return of 20% Not surprisingly, 968 outperformed its industry which returned 8.0%, giving us more conviction of the company’s capacity to drive bottom-line growth going forward. 968’s ability to maintain an adequate level of cash to meet upcoming liabilities is a good sign for its financial health. This suggests prudent control over cash and cost by management, which is a key determinant of the company’s health. 968’s has produced operating cash levels of 0.22x total debt over the past year, which implies that 968’s management has put its borrowings into good use by generating enough cash to cover a sufficient portion of borrowings.
968’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 968’s projected earnings trajectory does follow analyst consensus growth, which determines my intrinsic value of the company. Also, relative to the rest of its peers with similar levels of earnings, 968’s share price is trading below the group’s average. This further reaffirms that 968 is potentially undervalued.
Next Steps:
For Xinyi Solar Holdings, I’ve compiled three important aspects you should further examine:
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Future Outlook: What are well-informed industry analysts predicting for 968’s future growth? Take a look at our free research report of analyst consensus for 968’s outlook.
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Dividend Income vs Capital Gains: Does 968 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 968 as an investment.
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Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of 968? 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.