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Is Motor Oil (Hellas) Corinth Refineries S.A. (ATH:MOH) Potentially Underrated?

Lester Strauss

I’ve been keeping an eye on Motor Oil (Hellas) Corinth Refineries S.A. (ATH:MOH) because I’m attracted to its fundamentals. Looking at the company as a whole, as a potential stock investment, I believe MOH has a lot to offer. Basically, it is a financially-sound company with a a great track record of performance, trading at a discount. Below, I’ve touched on some key aspects you should know on a high level. If you’re interested in understanding beyond my broad commentary, take a look at the report on Motor Oil (Hellas) Corinth Refineries here.

Excellent balance sheet established dividend payer

Over the past few years, MOH has demonstrated a proven ability to generate robust returns of 30% Unsurprisingly, MOH surpassed the Oil and Gas industry return of 13%, which gives us more confidence of the company’s capacity to drive earnings going forward. MOH is financially robust, with ample cash on hand and short-term investments to meet upcoming liabilities. This suggests prudent control over cash and cost by management, which is an important determinant of the company’s health. MOH’s has produced operating cash levels of 0.27x total debt over the past year, which implies that MOH’s management has put its borrowings into good use by generating enough cash to cover a sufficient portion of borrowings.

ATSE:MOH Income Statement Export January 30th 19

MOH is currently trading below its true value, which means the market is undervaluing the company’s expected cash flow going forward. Investors have the opportunity to buy into the stock to reap capital gains, if MOH’s projected earnings trajectory does follow analyst consensus growth, which determines my intrinsic value of the company. Compared to the rest of the oil and gas industry, MOH is also trading below its peers, relative to earnings generated. This bolsters the proposition that MOH’s price is currently discounted.

ATSE:MOH Intrinsic Value Export January 30th 19

Next Steps:

For Motor Oil (Hellas) Corinth Refineries, there are three essential factors you should further examine:

  1. Future Outlook: What are well-informed industry analysts predicting for MOH’s future growth? Take a look at our free research report of analyst consensus for MOH’s outlook.
  2. Dividend Income vs Capital Gains: Does MOH 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 MOH as an investment.
  3. Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of MOH? 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.