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Is Thelloy Development Group Limited (HKG:1546) Potentially Underrated?

Simply Wall St

Building up an investment case requires looking at a stock holistically. Today I've chosen to put the spotlight on Thelloy Development Group Limited (HKG:1546) due to its excellent fundamentals in more than one area. 1546 is a company with great financial health as well as a a great track record of performance. In the following section, I expand a bit more on these key aspects. For those interested in digging a bit deeper into my commentary, read the full report on Thelloy Development Group here.

Excellent balance sheet with proven track record

Over the past few years, 1546 has demonstrated a proven ability to generate robust returns of 27%. Unsurprisingly, 1546 surpassed the Construction industry return of 10%, which gives us more confidence of the company's capacity to drive earnings going forward. 1546'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 1546 has sufficient cash flows and proper cash management in place, which is an important determinant of the company’s health. 1546 appears to have made good use of debt, producing operating cash levels of 7.83x total debt in the prior year. This is a strong indication that debt is reasonably met with cash generated.

SEHK:1546 Income Statement, September 25th 2019

Next Steps:

For Thelloy Development Group, I've put together three fundamental aspects you should further examine:

  1. Future Outlook: What are well-informed industry analysts predicting for 1546’s future growth? Take a look at our free research report of analyst consensus for 1546’s outlook.
  2. Valuation: What is 1546 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 1546 is currently mispriced by the market.
  3. Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of 1546? 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 editorial-team@simplywallst.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.