As an investor, I look for investments which do 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 DCC plc (LON:DCC), it is a financially-sound , dividend-paying company with a great history of performance. Below, I've touched on some key aspects you should know on a high level. For those interested in understanding where the figures come from and want to see the analysis, read the full report on DCC here.
Excellent balance sheet with proven track record and pays a dividend
Over the past few years, DCC has demonstrated a proven ability to generate robust returns of 4.3% Not surprisingly, DCC outperformed its industry which returned 3.1%, giving us more conviction of the company's capacity to drive bottom-line growth going forward. DCC's strong financial health means that all of its upcoming liability payments are able to be met by its current cash and short-term investment holdings. This implies that DCC manages its cash and cost levels well, which is a crucial insight into the health of the company. DCC seems to have put its debt to good use, generating operating cash levels of 0.26x 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.
DCC is also a dividend company, with ample net income to cover its dividend payout, which has been consistently growing over the past decade, keeping income investors happy.
For DCC, there are three important factors you should look at:
- Future Outlook: What are well-informed industry analysts predicting for DCC’s future growth? Take a look at our free research report of analyst consensus for DCC’s outlook.
- Valuation: What is DCC 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 DCC is currently mispriced by the market.
- Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of DCC? 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 email@example.com. 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.