Should You Consider K-Bro Linen Inc. (TSE:KBL)?

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K-Bro Linen Inc. (TSE:KBL) 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 KBL, it is a notable dividend payer that has been able to sustain great financial health over the past. In the following section, I expand a bit more on these key aspects. For those interested in digger a bit deeper into my commentary, take a look at the report on K-Bro Linen here.

Adequate balance sheet average dividend payer

KBL’s ability to maintain an adequate level of cash to meet upcoming liabilities is a good sign for its financial health. This suggests prudent control over cash and cost by management, which is a key determinant of the company’s health. KBL’s has produced operating cash levels of 0.25x total debt over the past year, which implies that KBL’s management has put its borrowings into good use by generating enough cash to cover a sufficient portion of borrowings.

TSX:KBL Historical Debt, April 30th 2019
TSX:KBL Historical Debt, April 30th 2019

KBL pays a decent dividend yield to its shareholders, beating the low-risk savings rate, which is what investors expect when they take on the risk of investing in the stock market. That said, please remember that dividend yields are a function of stock prices and corporate profits, both of which can be volatile.

TSX:KBL Historical Dividend Yield, April 30th 2019
TSX:KBL Historical Dividend Yield, April 30th 2019

Next Steps:

For K-Bro Linen, there are three fundamental aspects you should look at:

  1. Future Outlook: What are well-informed industry analysts predicting for KBL’s future growth? Take a look at our free research report of analyst consensus for KBL’s outlook.
  2. Historical Performance: What has KBL’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.
  3. Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of KBL? 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.