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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 Qilu Expressway Company Limited (HKG:1576), it is a company that has been able to sustain great financial health, trading at an attractive share price. Below is a brief commentary on these key aspects. For those interested in digger a bit deeper into my commentary, read the full report on Qilu Expressway here.
Excellent balance sheet and good value
1576 is financially robust, with ample cash on hand and short-term investments to meet upcoming liabilities. This implies that 1576 manages its cash and cost levels well, which is a crucial insight into the health of the company. 1576's has produced operating cash levels of 1.31x total debt over the past year, which implies that 1576's management has put its borrowings into good use by generating enough cash to cover a sufficient portion of borrowings. 1576'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 1576's earnings, investors now have the opportunity to buy into the stock to reap capital gains. Compared to the rest of the infrastructure industry, 1576 is also trading below its peers, relative to earnings generated. This further reaffirms that 1576 is potentially undervalued.
For Qilu Expressway, I've put together three pertinent factors you should look at:
- Future Outlook: What are well-informed industry analysts predicting for 1576’s future growth? Take a look at our free research report of analyst consensus for 1576’s outlook.
- Historical Performance: What has 1576'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.
- Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of 1576? 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.