As an investor, I look for investments which does not compromise one fundamental factor for another. By this I mean, I look at stocks holistically, from their financial health to their future outlook. In the case of Brickworks Limited (ASX:BKW), it is a financially-sound , dividend-paying company with a strong history of performance. 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, read the full report on Brickworks here.
Excellent balance sheet established dividend payer
BKW has a strong track record of performance. In the previous year, BKW delivered an impressive double-digit return of 7.1% Unsurprisingly, BKW surpassed the industry return of 6.9%, which gives us more confidence of the company's capacity to drive earnings going forward. BKW's ability to maintain an adequate level of cash to meet upcoming liabilities is a good sign for its financial health. This implies that BKW manages its cash and cost levels well, which is a key determinant of the company’s health. BKW appears to have made good use of debt, producing operating cash levels of 0.37x total debt in the prior year. This is a strong indication that debt is reasonably met with cash generated.
For those seeking income streams from their portfolio, BKW is a robust dividend payer as well. Over the past decade, the company has consistently increased its dividend payout, reaching a yield of 3.2%.
For Brickworks, there are three essential factors you should look at:
- Future Outlook: What are well-informed industry analysts predicting for BKW’s future growth? Take a look at our free research report of analyst consensus for BKW’s outlook.
- Valuation: What is BKW 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 BKW is currently mispriced by the market.
- Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of BKW? 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 firstname.lastname@example.org. 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.