U.S. Markets open in 6 hrs 40 mins

Wesdome Gold Mines Ltd. (TSE:WDO): The Best Of Both Worlds

Simply Wall St

Want to participate in a research study? Help shape the future of investing tools and earn a $60 gift card!

Attractive stocks have exceptional fundamentals. In the case of Wesdome Gold Mines Ltd. (TSE:WDO), there's is a financially-robust company with an impressive track record and an optimistic growth outlook. 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 Wesdome Gold Mines here.

Flawless balance sheet with high growth potential

Investors in search for stocks with room to flourish should look no further than WDO, with its expected earnings growth of 46%. This growth in the bottom-line is bolstered by an impressive top-line expansion of 90% over the same period, which is a sustainable driver of high-quality earnings, as opposed to pure cost-cutting activities. Over the past few years, WDO has more than doubled its earnings, with its most recent figure exceeding its annual average over the past five years. Not only did WDO outperformed its past performance, its growth also surpassed the Metals and Mining industry expansion, which generated a -29% earnings growth. This is what investors like to see!

TSX:WDO Past and Future Earnings, April 3rd 2019

WDO's ability to maintain an adequate level of cash to meet upcoming liabilities is a good sign for its financial health. This suggests prudent control over cash and cost by management, which is a key determinant of the company’s health. WDO appears to have made good use of debt, producing operating cash levels of 4.72x total debt in the prior year. This is a strong indication that debt is reasonably met with cash generated.

TSX:WDO Historical Debt, April 3rd 2019

Next Steps:

For Wesdome Gold Mines, I've compiled three pertinent factors you should look at:

  1. Valuation: What is WDO 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 WDO is currently mispriced by the market.
  2. Dividend Income vs Capital Gains: Does WDO 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 WDO as an investment.
  3. Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of WDO? 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.