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 GFT Technologies SE (ETR:GFT), it is a financially-healthy company with a an impressive track record of performance, trading at a great value. In the following section, I expand a bit more on these key aspects. If you're interested in understanding beyond my broad commentary, read the full report on GFT Technologies here.
Established dividend payer and good value
Over the past year, GFT has grown its earnings by 27%, with its most recent figure exceeding its annual average over the past five years. Not only did GFT outperformed its past performance, its growth also surpassed the IT industry expansion, which generated a 18% earnings growth. This paints a buoyant picture for the company. GFT's ability to maintain an adequate level of cash to meet upcoming liabilities is a good sign for its financial health. This implies that GFT manages its cash and cost levels well, which is a crucial insight into the health of the company. GFT seems to have put its debt to good use, generating operating cash levels of 0.37x 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.
GFT is currently trading below its true value, which means the market is undervaluing the company's expected cash flow going forward. According to my intrinsic value of the stock, which is driven by analyst consensus forecast of GFT's earnings, investors now have the opportunity to buy into the stock to reap capital gains. Compared to the rest of the it industry, GFT is also trading below its peers, relative to earnings generated. This further reaffirms that GFT is potentially undervalued.
For GFT Technologies, there are three essential aspects you should further research:
- Future Outlook: What are well-informed industry analysts predicting for GFT’s future growth? Take a look at our free research report of analyst consensus for GFT’s outlook.
- Dividend Income vs Capital Gains: Does GFT 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 GFT as an investment.
- Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of GFT? 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.