I’ve been keeping an eye on China Green Agriculture Inc (NYSE:CGA) because I’m attracted to its fundamentals. Looking at the company as a whole, as a potential stock investment, I believe CGA has a lot to offer. Basically, it is a company that has been able to sustain great financial health, trading at an attractive share price. In the following section, I expand a bit more on these key aspects. For those interested in digger a bit deeper into my commentary, read the full report on China Green Agriculture here.
Flawless balance sheet and undervalued
CGA’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 crucial insight into the health of the company. CGA appears to have made good use of debt, producing operating cash levels of 2.14x total debt in the prior year. This is a strong indication that debt is reasonably met with cash generated. CGA is currently trading below its true value, which means the market is undervaluing the company’s expected cash flow going forward. This mispricing gives investors the opportunity to buy into the stock at a cheap price compared to the value they will be receiving, should analysts’ consensus forecast growth be correct. Compared to the rest of the chemicals industry, CGA is also trading below its peers, relative to earnings generated. This supports the theory that CGA is potentially underpriced.
For China Green Agriculture, I’ve compiled three important factors you should further examine:
- Future Outlook: What are well-informed industry analysts predicting for CGA’s future growth? Take a look at our free research report of analyst consensus for CGA’s outlook.
- Historical Performance: What has CGA’s returns been like over the past? Go into more detail in the past track record analysis and take a look at the free visual representations of our analysis for more clarity.
- Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of CGA? 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 pass 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.