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Building up an investment case requires looking at a stock holistically. Today I've chosen to put the spotlight on Cogeco Inc. (TSE:CGO) due to its excellent fundamentals in more than one area. CGO is a notable dividend-paying company with a a strong history of performance, trading at a discount. Below, I've touched on some key aspects you should know on a high level. For those interested in understanding where the figures come from and want to see the analysis, take a look at the report on Cogeco here.
Undervalued with proven track record and pays a dividend
In the previous year, CGO has ramped up its bottom line by 13%, with its latest earnings level surpassing its average level over the last five years. In addition to beating its historical values, CGO also outperformed its industry, which delivered a growth of -14%. This is an optimistic signal for the future. CGO is currently trading below its true value, which means the market is undervaluing the company's expected cash flow going forward. Investors have the opportunity to buy into the stock to reap capital gains, if CGO's projected earnings trajectory does follow analyst consensus growth, which determines my intrinsic value of the company. Compared to the rest of the media industry, CGO is also trading below its peers, relative to earnings generated. This supports the theory that CGO is potentially underpriced.
Income investors would also be happy to know that CGO is a great dividend company, with a current yield standing at 2.2%. CGO has also been regularly increasing its dividend payments to shareholders over the past decade.
For Cogeco, there are three key aspects you should further research:
- Future Outlook: What are well-informed industry analysts predicting for CGO’s future growth? Take a look at our free research report of analyst consensus for CGO’s outlook.
- Financial Health: Are CGO’s operations financially sustainable? Balance sheets can be hard to analyze, which is why we’ve done it for you. Check out our financial health checks here.
- Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of CGO? 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 firstname.lastname@example.org. 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.