Why We Think Ten Pao Group Holdings Limited (HKG:1979) Could Be Worth Looking At
Ten Pao Group Holdings Limited (HKG:1979) 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 1979, it is a financially-healthy company with a strong track record and a buoyant future outlook. Below is a brief commentary on these key aspects. For those interested in digging a bit deeper into my commentary, take a look at the report on Ten Pao Group Holdings here.
Undervalued with high growth potential
Investors in search for stocks with room to flourish should look no further than 1979, with its expected earnings growth of 23% which is expected to flow into an impressive return on equity of 27% over the next couple of years. Over the past few years, 1979 has more than doubled its earnings, with its most recent figure exceeding its annual average over the past five years. The strong earnings growth is reflected in impressive double-digit 23% return to shareholders, which is what investors like to see!
1979 is financially robust, with ample cash on hand and short-term investments to meet upcoming liabilities. This indicates that 1979 has sufficient cash flows and proper cash management in place, which is an important determinant of the company’s health. 1979's has produced operating cash levels of 0.83x total debt over the past year, which implies that 1979's management has put its borrowings into good use by generating enough cash to cover a sufficient portion of borrowings.
Next Steps:
For Ten Pao Group Holdings, there are three important factors you should look at:
Valuation: What is 1979 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 1979 is currently mispriced by the market.
Dividend Income vs Capital Gains: Does 1979 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 1979 as an investment.
Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of 1979? 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.
