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Scientific Digital Imaging plc (LON:SDI) 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 SDI, it is a financially-healthy company with an impressive history and an optimistic growth outlook. In the following section, I expand a bit more on these key aspects. For those interested in digger a bit deeper into my commentary, take a look at the report on Scientific Digital Imaging here.
High growth potential with excellent balance sheet
SDI delivered a satisfying double-digit returns of 9.2% in the most recent year Not surprisingly, SDI outperformed its industry which returned 9.0%, giving us more conviction of the company's capacity to drive bottom-line growth going forward.
SDI's ability to maintain an adequate level of cash to meet upcoming liabilities is a good sign for its financial health. This indicates that SDI has sufficient cash flows and proper cash management in place, which is an important determinant of the company’s health. SDI appears to have made good use of debt, producing operating cash levels of 2.38x total debt in the prior year. This is a strong indication that debt is reasonably met with cash generated.
For Scientific Digital Imaging, there are three pertinent aspects you should look at:
- Valuation: What is SDI 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 SDI is currently mispriced by the market.
- Dividend Income vs Capital Gains: Does SDI 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 SDI as an investment.
- Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of SDI? 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.