Building up an investment case requires looking at a stock holistically. Today I've chosen to put the spotlight on EVZ Limited (ASX:EVZ) due to its excellent fundamentals in more than one area. EVZ is a company that has been able to sustain great financial health, trading at an attractive share price. In the following section, I expand a bit more on these key aspects. If you're interested in understanding beyond my broad commentary, read the full report on EVZ here.
Flawless balance sheet and undervalued
EVZ is financially robust, with ample cash on hand and short-term investments to meet upcoming liabilities. This indicates that EVZ has sufficient cash flows and proper cash management in place, which is an important determinant of the company’s health. EVZ seems to have put its debt to good use, generating operating cash levels of 0.68x total debt in the most recent year. This is also a good indication as to whether debt is properly covered by the company’s cash flows. EVZ's share price is trading at below its true value, meaning that the market sentiment for the stock is currently bearish. According to my intrinsic value of the stock, which is driven by analyst consensus forecast of EVZ's earnings, investors now have the opportunity to buy into the stock to reap capital gains. Compared to the rest of the construction industry, EVZ is also trading below its peers, relative to earnings generated. This bolsters the proposition that EVZ's price is currently discounted.
For EVZ, I've put together three important aspects you should further examine:
- Future Outlook: What are well-informed industry analysts predicting for EVZ’s future growth? Take a look at our free research report of analyst consensus for EVZ’s outlook.
- Historical Performance: What has EVZ's returns been like over the past? Go into more detail in the past track record analysis and take a look at the free visual representations of our analysis for more clarity.
- Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of EVZ? 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.