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Valhi, Inc. (NYSE:VHI) is a stock with outstanding fundamental characteristics. When we build an investment case, we need to look at the stock with a holistic perspective. In the case of VHI, it is a company with great financial health as well as a a great history of performance. 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, read the full report on Valhi here.
Proven track record with adequate balance sheet
VHI delivered a satisfying double-digit returns of 22% in the most recent year Unsurprisingly, VHI surpassed the Chemicals industry return of 15%, which gives us more confidence of the company's capacity to drive earnings going forward. VHI'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 implies that VHI manages its cash and cost levels well, which is a crucial insight into the health of the company. VHI’s earnings amply cover its interest expense. Paying interest on time and in full can help the company get favourable debt terms in the future, leading to lower cost of debt and helps VHI expand.
For Valhi, I've put together three key aspects you should look at:
- Future Outlook: What are well-informed industry analysts predicting for VHI’s future growth? Take a look at our free research report of analyst consensus for VHI’s outlook.
- Valuation: What is VHI 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 VHI is currently mispriced by the market.
- Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of VHI? 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.