Reasons Why I Like Clinuvel Pharmaceuticals Limited (ASX:CUV)

Clinuvel Pharmaceuticals Limited (ASX:CUV) 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 CUV, it is a company with great financial health as well as a an impressive track record of performance. In the following section, I expand a bit more on these key aspects. If you’re interested in understanding beyond my high-level commentary, take a look at the report on Clinuvel Pharmaceuticals here.

Flawless balance sheet with solid track record

CUV delivered a triple-digit bottom-line expansion over the past couple of years, with its most recent earnings level surpassing its average level over the last five years. The strong earnings growth is reflected in impressive double-digit 21.93% return to shareholders, which is an notable feat for the company. CUV’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 implies that CUV manages its cash and cost levels well, which is an important determinant of the company’s health. Looking at CUV’s capital structure, the company has no debt on its balance sheet. It has only utilized funding from its equity capital to run the business, which is typically normal for a small-cap company. Therefore the company has plenty of headroom to grow, and the ability to raise debt should it need to in the future.

ASX:CUV Income Statement June 15th 18
ASX:CUV Income Statement June 15th 18

Next Steps:

For Clinuvel Pharmaceuticals, I’ve put together three relevant aspects you should further examine:

  1. Future Outlook: What are well-informed industry analysts predicting for CUV’s future growth? Take a look at our free research report of analyst consensus for CUV’s outlook.
  2. Valuation: What is CUV 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 CUV is currently mispriced by the market.
  3. Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of CUV? Explore our interactive list of stocks with large potential to get an idea of what else is out there you may be missing!