Luks Group (Vietnam Holdings) Company Limited (HKG:366): The Best Of Both Worlds
Luks Group (Vietnam Holdings) Company Limited (HKG:366) 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 366, it is a financially-robust company with an impressive history high-quality dividend payments, trading at a discount. Below is a brief commentary on these key aspects. If you're interested in understanding beyond my broad commentary, take a look at the report on Luks Group (Vietnam Holdings) here.
Undervalued with excellent balance sheet and pays a dividend
366'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 indicates that 366 has sufficient cash flows and proper cash management in place, which is an important determinant of the company’s health. 366 appears to have made good use of debt, producing operating cash levels of 2.81x total debt in the prior year. This is a strong indication that debt is reasonably met with cash generated. 366'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. Compared to the rest of the materials industry, 366 is also trading below its peers, relative to earnings generated. This supports the theory that 366 is potentially underpriced.
For those seeking income streams from their portfolio, 366 is a robust dividend payer as well. Over the past decade, the company has consistently increased its dividend payout, reaching a yield of 7.4%, making it one of the best dividend companies in the market.
Next Steps:
For Luks Group (Vietnam Holdings), I've put together three essential factors you should further examine:
Future Outlook: What are well-informed industry analysts predicting for 366’s future growth? Take a look at our free research report of analyst consensus for 366’s outlook.
Historical Performance: What has 366'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 366? 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.
