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Guangshen Railway Company Limited (HKG:525): A Fundamentally Attractive Investment

Armando Maloney

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 Guangshen Railway Company Limited (HKG:525), it is a dependable dividend-paying company that has been able to sustain great financial health over the past. Below, I’ve touched on some key aspects you should know on a high level. For those interested in digger a bit deeper into my commentary, read the full report on Guangshen Railway here.

Flawless balance sheet average dividend payer

525’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 key determinant of the company’s health. Investors should not worry about 525’s debt levels because the company has none! This implies that the company is running its operations purely on off equity funding. which is rather impressive for a HK$30.76b market cap company. Investors’ risk associated with debt is virtually non-existent and the company has plenty of headroom to grow debt in the future, should the need arise.

SEHK:525 Historical Debt August 29th 18

For those seeking income streams from their portfolio, 525 is a robust dividend payer as well. Over the past decade, the company has consistently increased its dividend payout, reaching a yield of 2.6%.

SEHK:525 Historical Dividend Yield August 29th 18

Next Steps:

For Guangshen Railway, I’ve compiled three essential factors you should look at:

  1. Future Outlook: What are well-informed industry analysts predicting for 525’s future growth? Take a look at our free research report of analyst consensus for 525’s outlook.
  2. Historical Performance: What has 525’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.
  3. Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of 525? 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 past 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. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.