Why Fundamental Investors Might Love Diversified Gas & Oil PLC (LON:DGOC)

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Building up an investment case requires looking at a stock holistically. Today I've chosen to put the spotlight on Diversified Gas & Oil PLC (LON:DGOC) due to its excellent fundamentals in more than one area. DGOC is a dependable dividend payer with a a great track record of performance, trading at a discount. In the following section, I expand a bit more on these key aspects. If you're interested in understanding beyond my broad commentary, take a look at the report on Diversified Gas & Oil here.

Outstanding track record, good value and pays a dividend

DGOC 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 27% return to shareholders, which is an notable feat for the company. DGOC's share price is trading at below its true value, meaning that the market sentiment for the stock is currently bearish. According to my intrinsic value of the stock, which is driven by analyst consensus forecast of DGOC's earnings, investors now have the opportunity to buy into the stock to reap capital gains. Compared to the rest of the oil and gas industry, DGOC is also trading below its peers, relative to earnings generated. This further reaffirms that DGOC is potentially undervalued.

DGOC's high dividend payments make it one of the best dividend stocks on the market, and it has also been able to maintain it at a level in which net income is able to cover dividend payments.

Next Steps:

For Diversified Gas & Oil, I've compiled three pertinent factors you should further research:

1. Future Outlook: What are well-informed industry analysts predicting for DGOC’s future growth? Take a look at our free research report of analyst consensus for DGOC’s outlook.
2. Financial Health: Are DGOC’s operations financially sustainable? Balance sheets can be hard to analyze, which is why we’ve done it for you. Check out our financial health checks here.
3. Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of DGOC? 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.