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Building up an investment case requires looking at a stock holistically. Today I've chosen to put the spotlight on Jujiang Construction Group Co., Ltd. (HKG:1459) due to its excellent fundamentals in more than one area. 1459 is a financially-healthy company with a an impressive track record of performance, trading at a great value. In the following section, I expand a bit more on these key aspects. For those interested in understanding where the figures come from and want to see the analysis, take a look at the report on Jujiang Construction Group here.

Flawless balance sheet and undervalued

In the previous year, 1459 has ramped up its bottom line by 38%, with its latest earnings level surpassing its average level over the last five years. In addition to beating its historical values, 1459 also outperformed its industry, which delivered a growth of -6.1%. This is what investors like to see! 1459 is financially robust, with ample cash on hand and short-term investments to meet upcoming liabilities. This implies that 1459 manages its cash and cost levels well, which is a crucial insight into the health of the company. 1459 seems to have put its debt to good use, generating operating cash levels of 0.88x 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.

1459's shares are now trading at a price below its true value based on its discounted cash flows, indicating a relatively pessimistic market sentiment. Investors have the opportunity to buy into the stock to reap capital gains, if 1459's projected earnings trajectory does follow analyst consensus growth, which determines my intrinsic value of the company. Also, relative to the rest of its peers with similar levels of earnings, 1459's share price is trading below the group's average. This supports the theory that 1459 is potentially underpriced.

Next Steps:

For Jujiang Construction Group, I've put together three pertinent aspects you should further examine:

1. Future Outlook: What are well-informed industry analysts predicting for 1459’s future growth? Take a look at our free research report of analyst consensus for 1459’s outlook.

2. Dividend Income vs Capital Gains: Does 1459 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 1459 as an investment.

3. Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of 1459? 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.