Good value with adequate balance sheet and pays a dividend
DIA seems to have put its debt to good use, generating operating cash levels of 0.29x total debt in the most recent year. This is also a good indication as to whether debt is properly covered by the company’s cash flows. Also, DIA’s earnings amply cover its interest expense. Paying interest on time and in full can help the company get favourable debt terms in the future, leading to lower cost of debt and helps DIA expand. DIA is currently trading below its true value, which means the market is undervaluing the company’s expected cash flow going forward. 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 consumer retailing industry, DIA is also trading below its peers, relative to earnings generated. This further reaffirms that DIA is potentially undervalued.
DIA is considered one of the top dividend payers in the market, and it has also been able to maintain it at a level in which net income is able to cover dividend payments.
For Distribuidora Internacional de Alimentación, I’ve compiled three essential factors you should further research:
- Future Outlook: What are well-informed industry analysts predicting for DIA’s future growth? Take a look at our free research report of analyst consensus for DIA’s outlook.
- Historical Performance: What has DIA’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.
- Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of DIA? Explore our interactive list of stocks with large potential to get an idea of what else is out there you may be missing!