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 Zhengzhou Coal Mining Machinery Group Company Limited (HKG:564), it is a financially-sound company with a a excellent future outlook, not yet reflected in the share price. 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 Zhengzhou Coal Mining Machinery Group here.
Good value with reasonable growth potential
564’s share price is trading below its true value according to its price-to-earnings ratio of 8.05x compared to its industry as well as the wider stock market, so potential investors can purchase the stock below its value.
564’s ability to maintain an adequate level of cash to meet upcoming liabilities is a good sign for its financial health. This implies that 564 manages its cash and cost levels well, which is a crucial insight into the health of the company. 564’s debt-to-equity ratio stands at 36%, which means its debt level is acceptable. This indicates a good balance between taking advantage of low cost funding through debt financing, but having enough financial flexibility and headroom to grow debt in the future.
For Zhengzhou Coal Mining Machinery Group, there are three fundamental aspects you should further research:
- Historical Performance: What has 564’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.
- Dividend Income vs Capital Gains: Does 564 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 564 as an investment.
- Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of 564? Explore our interactive list of stocks with large potential to get an idea of what else is out there you may be missing!
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at email@example.com.