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Westshore Terminals Investment Corporation (TSE:WTE) 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 WTE, it is a financially-healthy company with a an impressive history of performance, trading at a discount. Below is a brief commentary on these key aspects. If you're interested in understanding beyond my broad commentary, take a look at the report on Westshore Terminals Investment here.
Excellent balance sheet and good value
WTE delivered a bottom-line expansion of 9.2% in the prior year, with its most recent earnings level surpassing its average level over the last five years. The strong earnings growth is reflected in impressive double-digit 20% return to shareholders, which is an optimistic signal for the future. WTE is financially robust, with ample cash on hand and short-term investments to meet upcoming liabilities. This suggests prudent control over cash and cost by management, which is a crucial insight into the health of the company. Investors should not worry about WTE’s debt levels because the company has none! It has only utilized funding from its equity capital to run the business, which is typically normal for a small-cap company. Therefore the company has plenty of headroom to grow, and the ability to raise debt should it need to in the future.
WTE's shares are now trading at a price below its true value based on its discounted cash flows, indicating a relatively pessimistic market sentiment. According to my intrinsic value of the stock, which is driven by analyst consensus forecast of WTE's earnings, investors now have the opportunity to buy into the stock to reap capital gains. Also, relative to the rest of its peers with similar levels of earnings, WTE's share price is trading below the group's average. This bolsters the proposition that WTE's price is currently discounted.
For Westshore Terminals Investment, there are three key aspects you should look at:
- Future Outlook: What are well-informed industry analysts predicting for WTE’s future growth? Take a look at our free research report of analyst consensus for WTE’s outlook.
- Dividend Income vs Capital Gains: Does WTE 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 WTE as an investment.
- Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of WTE? 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.