CompX International Inc. (NYSEMKT:CIX) is a company with exceptional fundamental characteristics. Upon building up an investment case for a stock, we should look at various aspects. In the case of CIX, it is a financially-sound company with an impressive track record of performance, trading at a great value. Below, I’ve touched on some key aspects you should know on a high level. For those interested in understanding where the figures come from and want to see the analysis, read the full report on CompX International here.
Flawless balance sheet and good value
CIX delivered a satisfying double-digit returns of 7.2% in the most recent year Not surprisingly, CIX outperformed its industry which returned 6.5%, giving us more conviction of the company’s capacity to drive bottom-line growth going forward. CIX is financially robust, with ample cash on hand and short-term investments to meet upcoming liabilities. This suggests prudent control over cash and cost by management, which is an important determinant of the company’s health. CIX currently has no debt on its balance sheet. This means it is running its business only on equity capital funding, which is typically normal for a small-cap company. CIX has plenty of financial flexibility, without debt obligations to meet in the short term, as well as the headroom to raise debt should it need to in the future.
CIX’s shares are now trading at a price below its true value based on its discounted cash flows, indicating a relatively pessimistic market sentiment. 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 commercial services industry, CIX is also trading below its peers, relative to earnings generated. This bolsters the proposition that CIX’s price is currently discounted.
For CompX International, I’ve put together three important factors you should further examine:
- Future Outlook: What are well-informed industry analysts predicting for CIX’s future growth? Take a look at our free research report of analyst consensus for CIX’s outlook.
- Dividend Income vs Capital Gains: Does CIX 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 CIX as an investment.
- Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of CIX? 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 firstname.lastname@example.org. 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.