I've been keeping an eye on Taitron Components Incorporated (NASDAQ:TAIT) because I'm attracted to its fundamentals. Looking at the company as a whole, as a potential stock investment, I believe TAIT has a lot to offer. Basically, it is a financially-sound company with an impressive history of performance, trading at a discount. Below is a brief commentary on these key aspects. If you're interested in understanding beyond my broad commentary, take a look at the report on Taitron Components here.
Flawless balance sheet, undervalued and pays a dividend
TAIT delivered a triple-digit bottom-line expansion over the past couple of years, with its most recent earnings level surpassing its average level over the last five years. In addition to beating its historical values, TAIT also outperformed its industry, which delivered a growth of 50%. This is an notable feat for the company. TAIT's ability to maintain an adequate level of cash to meet upcoming liabilities is a good sign for its financial health. This implies that TAIT manages its cash and cost levels well, which is a key determinant of the company’s health. Looking at TAIT's capital structure, the company has no debt on its balance sheet. This means it is running its business only on equity capital funding, which is typically normal for a small-cap company. Therefore the company has plenty of headroom to grow, and the ability to raise debt should it need to in the future.
TAIT 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 TAIT's earnings, investors now have the opportunity to buy into the stock to reap capital gains. Compared to the rest of the electronic industry, TAIT is also trading below its peers, relative to earnings generated. This further reaffirms that TAIT is potentially undervalued.
For Taitron Components, I've put together three important aspects you should look at:
- Future Outlook: What are well-informed industry analysts predicting for TAIT’s future growth? Take a look at our free research report of analyst consensus for TAIT’s outlook.
- Dividend Income vs Capital Gains: Does TAIT 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 TAIT as an investment.
- Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of TAIT? 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.