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A Holistic Look At SH Group (Holdings) Limited (HKG:1637)

Simply Wall St

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Attractive stocks have exceptional fundamentals. In the case of SH Group (Holdings) Limited (HKG:1637), there's is a company that has been able to sustain great financial health, trading at an attractive share price. 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 SH Group (Holdings) here.

Undervalued with excellent balance sheet

1637'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 suggests prudent control over cash and cost by management, which is a crucial insight into the health of the company. 1637 appears to have made good use of debt, producing operating cash levels of 3.38x total debt in the prior year. This is a strong indication that debt is reasonably met with cash generated. 1637 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 1637'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, 1637's share price is trading below the group's average. This bolsters the proposition that 1637's price is currently discounted.

SEHK:1637 Price Estimation Relative to Market, May 27th 2019

Next Steps:

For SH Group (Holdings), I've put together three pertinent aspects you should look at:

  1. Future Outlook: What are well-informed industry analysts predicting for 1637’s future growth? Take a look at our free research report of analyst consensus for 1637’s outlook.
  2. Historical Performance: What has 1637'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 1637? 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 editorial-team@simplywallst.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.