Imperial Brands PLC (LON:IMB): The Best Of Both Worlds

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Attractive stocks have exceptional fundamentals. In the case of Imperial Brands PLC (LON:IMB), there’s is a notable dividend-paying company with a an impressive track record of performance, trading at a great value. Below, I’ve touched on some key aspects you should know on a high level. For those interested in digger a bit deeper into my commentary, read the full report on Imperial Brands here.

Good value with proven track record and pays a dividend

In the previous year, IMB has ramped up its bottom line by 27%, with its latest earnings level surpassing its average level over the last five years. In addition to beating its historical values, IMB also outperformed its industry, which delivered a growth of 16%. This paints a buoyant picture for the company. IMB’s shares are now trading at a price below its true value based on its discounted cash flows, indicating a relatively pessimistic market sentiment. 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. Also, relative to the rest of its peers with similar levels of earnings, IMB’s share price is trading below the group’s average. This supports the theory that IMB is potentially underpriced.

LSE:IMB Income Statement, May 13th 2019
LSE:IMB Income Statement, May 13th 2019

For those seeking income streams from their portfolio, IMB is a robust dividend payer as well. Over the past decade, the company has consistently increased its dividend payout, reaching a yield of 8.7%, making it one of the best dividend companies in the market.

LSE:IMB Historical Dividend Yield, May 13th 2019
LSE:IMB Historical Dividend Yield, May 13th 2019

Next Steps:

For Imperial Brands, I’ve compiled three relevant factors you should further examine:

  1. Future Outlook: What are well-informed industry analysts predicting for IMB’s future growth? Take a look at our free research report of analyst consensus for IMB’s outlook.
  2. Financial Health: Are IMB’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 IMB? 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.