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Why Straco Corporation Limited (SGX:S85) Could Be Your Next Investment

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Attractive stocks have exceptional fundamentals. In the case of Straco Corporation Limited (SGX:S85), there's is a company with great financial health as well as a a strong track record of performance. Below is a brief commentary on these key aspects. For those interested in understanding where the figures come from and want to see the analysis, read the full report on Straco here.

Excellent balance sheet with proven track record

S85 delivered a bottom-line expansion of 10% in the prior year, with its most recent earnings level surpassing its average level over the last five years. Not only did S85 outperformed its past performance, its growth also surpassed the Hospitality industry expansion, which generated a -11% earnings growth. This paints a buoyant picture for the company. S85's strong financial health means that all of its upcoming liability payments are able to be met by its current cash and short-term investment holdings. This suggests prudent control over cash and cost by management, which is an important determinant of the company’s health. S85 appears to have made good use of debt, producing operating cash levels of 0.84x total debt in the prior year. This is a strong indication that debt is reasonably met with cash generated.

SGX:S85 Income Statement, June 23rd 2019
SGX:S85 Income Statement, June 23rd 2019

Next Steps:

For Straco, there are three fundamental factors you should look at:

  1. Future Outlook: What are well-informed industry analysts predicting for S85’s future growth? Take a look at our free research report of analyst consensus for S85’s outlook.

  2. Valuation: What is S85 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 S85 is currently mispriced by the market.

  3. Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of S85? 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.

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