Building up an investment case requires looking at a stock holistically. Today I've chosen to put the spotlight on Korvest Ltd (ASX:KOV) due to its excellent fundamentals in more than one area. KOV is a financially-sound , dividend-paying company with a great track record of performance. Below is a brief commentary on these key aspects. For those interested in digging a bit deeper into my commentary, take a look at the report on Korvest here.
Flawless balance sheet with proven track record and pays a dividend
In the past couple of years, KOV has ramped up its bottom line by over 100%, with its latest earnings level surpassing its average level over the last five years. Not only did KOV outperformed its past performance, its growth also surpassed the Machinery industry expansion, which generated a 45% earnings growth. This is an notable feat for the company. KOV'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 indicates that KOV has sufficient cash flows and proper cash management in place, which is an important determinant of the company’s health. Looking at KOV's capital structure, the company has no debt on its balance sheet. This implies that the company is running its operations purely on off equity funding. which is typically normal for a small-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.
KOV's high dividend payments make it one of the best dividend stocks on the market, and its profitability ensures that dividends are well-covered by its net income.
For Korvest, there are three essential aspects you should look at:
- Future Outlook: What are well-informed industry analysts predicting for KOV’s future growth? Take a look at our free research report of analyst consensus for KOV’s outlook.
- Valuation: What is KOV worth today? Is the stock undervalued, even when its growth outlook is factored into its intrinsic value? The intrinsic value infographic in our free research report helps visualize whether KOV is currently mispriced by the market.
- Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of KOV? 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.