As an investor, I look for investments which does not compromise one fundamental factor for another. By this I mean, I look at stocks holistically, from their financial health to their future outlook. In the case of Toromont Industries Ltd. (TSE:TIH), it is a financially-healthy , dividend-paying company with a an impressive history of performance. 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 Toromont Industries here.
Adequate balance sheet with proven track record and pays a dividend
TIH delivered a bottom-line expansion of 39% in the prior year, with its most recent earnings level surpassing its average level over the last five years. Not only did TIH outperformed its past performance, its growth also exceeded the Trade Distributors industry expansion, which generated a 15% earnings growth. This paints a buoyant picture for the company. TIH’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 TIH has sufficient cash flows and proper cash management in place, which is an important determinant of the company’s health. TIH’s has produced operating cash levels of 0.91x total debt over the past year, which implies that TIH’s management has put its borrowings into good use by generating enough cash to cover a sufficient portion of borrowings.
For those seeking income streams from their portfolio, TIH is a robust dividend payer as well. Over the past decade, the company has consistently increased its dividend payout, reaching a yield of 1.6%.
Next Steps:
For Toromont Industries, I’ve compiled three relevant aspects you should further examine:
- Future Outlook: What are well-informed industry analysts predicting for TIH’s future growth? Take a look at our free research report of analyst consensus for TIH’s outlook.
- Valuation: What is TIH 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 TIH is currently mispriced by the market.
- Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of TIH? Explore our interactive list of stocks with large potential to get an idea of what else is out there you may be missing!
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.