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Why Fundamental Investors Might Love ageas SA/NV (EBR:AGS)

Simply Wall St

Attractive stocks have exceptional fundamentals. In the case of ageas SA/NV (EBR:AGS), there's is a financially-robust company with 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 digging a bit deeper into my commentary, take a look at the report on ageas here.

Good value with proven track record and pays a dividend

AGS delivered a bottom-line expansion of 25% in the prior year, with its most recent earnings level surpassing its average level over the last five years. Not only did AGS outperformed its past performance, its growth also exceeded the Insurance industry expansion, which generated a 7.0% earnings growth. This is an notable feat for the company. AGS is financially robust, with ample cash on hand and short-term investments to meet upcoming liabilities. This suggests prudent control over cash and cost by management, which is a crucial insight into the health of the company. With a debt-to-equity ratio of 36%, AGS’s debt level is acceptable. This means that AGS’s capital structure strikes a good balance between low-cost debt funding and maintaining financial flexibility without overly restrictive terms of debt.

ENXTBR:AGS Income Statement, August 26th 2019

AGS's share price is trading at below its true value, meaning that the market sentiment for the stock is currently bearish. This mispricing gives investors the opportunity to buy into the stock at a cheap price compared to the value they will be receiving, should analysts' consensus forecast growth be correct. Also, relative to the rest of its peers with similar levels of earnings, AGS's share price is trading below the group's average. This supports the theory that AGS is potentially underpriced.

ENXTBR:AGS Intrinsic value, August 26th 2019

Next Steps:

For ageas, there are three relevant aspects you should look at:

  1. Future Outlook: What are well-informed industry analysts predicting for AGS’s future growth? Take a look at our free research report of analyst consensus for AGS’s outlook.
  2. Dividend Income vs Capital Gains: Does AGS 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 AGS as an investment.
  3. Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of AGS? 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.