Building up an investment case requires looking at a stock holistically. Today I've chosen to put the spotlight on Superior Group of Companies, Inc. (NASDAQ:SGC) due to its excellent fundamentals in more than one area. SGC is a financially-sound company with an impressive history high-grade dividend payments, trading at a discount. Below is a brief commentary on these key aspects. For those interested in understanding where the figures come from and want to see the analysis, read the full report on Superior Group of Companies here.
Good value with adequate balance sheet and pays a dividend
SGC 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. SGC appears to have made good use of debt, producing operating cash levels of 0.22x total debt in the prior year. This is a strong indication that debt is reasonably met with cash generated. SGC's shares are now trading at a price below its true value based on its discounted cash flows, indicating a relatively pessimistic market sentiment. According to my intrinsic value of the stock, which is driven by analyst consensus forecast of SGC's earnings, investors now have the opportunity to buy into the stock to reap capital gains. Compared to the rest of the luxury industry, SGC is also trading below its peers, relative to earnings generated. This further reaffirms that SGC is potentially undervalued.
SGC is also a dividend company, with ample net income to cover its dividend payout, which has been consistently growing over the past decade, keeping income investors happy.
For Superior Group of Companies, I've put together three important aspects you should further examine:
- Future Outlook: What are well-informed industry analysts predicting for SGC’s future growth? Take a look at our free research report of analyst consensus for SGC’s outlook.
- Historical Performance: What has SGC'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 SGC? 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.