I’ve been keeping an eye on Yangarra Resources Ltd. (TSE:YGR) because I’m attracted to its fundamentals. Looking at the company as a whole, as a potential stock investment, I believe YGR has a lot to offer. Basically, it has a a great track record of performance and a excellent growth outlook not yet priced into the stock. Below is a brief commentary on these key aspects. For those interested in digger a bit deeper into my commentary, take a look at the report on Yangarra Resources here.
Undervalued with high growth potential
YGR is an attractive stock for growth-seeking investors, with an expected earnings growth of 31% in the upcoming year. This growth in the bottom-line is bolstered by an impressive top-line expansion of 73% over the same period, which is a sustainable driver of high-quality earnings, as opposed to pure cost-cutting activities. YGR delivered a bottom-line expansion of 72% in the prior year, with its most recent earnings level surpassing its average level over the last five years. Not only did YGR outperformed its past performance, its growth also exceeded the Oil and Gas industry expansion, which generated a 12% earnings growth. This is what investors like to see!
YGR’s share price is trading at below its true value, meaning that the market sentiment for the stock is currently bearish. According to my intrinsic value of the stock, which is driven by analyst consensus forecast of YGR’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, YGR’s share price is trading below the group’s average. This further reaffirms that YGR is potentially undervalued.
For Yangarra Resources, I’ve compiled three relevant factors you should further research:
- Financial Health: Does it have a healthy balance sheet? Take a look at our free balance sheet analysis with six simple checks on key factors like leverage and risk.
- Dividend Income vs Capital Gains: Does YGR 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 YGR as an investment.
- Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of YGR? 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.