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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 Quinsam Capital Corporation (CNSX:QCA), it is a financially-sound company with a an impressive track record of performance, trading at a discount. 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, read the full report on Quinsam Capital here.
Outstanding track record with flawless balance sheet
In the past couple of years, QCA has ramped up its bottom line by over 100%, with its latest earnings level surpassing its average level over the last five years. This illustrates a strong track record, leading to a satisfying return on equity of 24%, which is what investors like to see! QCA’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 suggests prudent control over cash and cost by management, which is a crucial insight into the health of the company. Looking at QCA’s capital structure, the company 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. Investors’ risk associated with debt is virtually non-existent and the company has plenty of headroom to grow debt in the future, should the need arise.
QCA is currently trading below its true value, which means the market is undervaluing the company’s expected cash flow going forward. Investors have the opportunity to buy into the stock to reap capital gains, if QCA’s projected earnings trajectory does follow analyst consensus growth, which determines my intrinsic value of the company. Compared to the rest of the capital markets industry, QCA is also trading below its peers, relative to earnings generated. This supports the theory that QCA is potentially underpriced.
For Quinsam Capital, I’ve compiled three fundamental factors you should further research:
- Future Outlook: What are well-informed industry analysts predicting for QCA’s future growth? Take a look at our free research report of analyst consensus for QCA’s outlook.
- Dividend Income vs Capital Gains: Does QCA 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 QCA as an investment.
- Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of QCA? 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.