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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 Central Depository Services (India) Limited (NSE:CDSL), it is a company with great financial health as well as a a great track record of performance. Below is a brief commentary on these key aspects. For those interested in digger a bit deeper into my commentary, take a look at the report on Central Depository Services (India) here.
Flawless balance sheet with proven track record
Over the past few years, CDSL has demonstrated a proven ability to generate robust returns of 14% Not surprisingly, CDSL outperformed its industry which returned 3.8%, giving us more conviction of the company’s capacity to drive bottom-line growth going forward. CDSL’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 implies that CDSL manages its cash and cost levels well, which is a key determinant of the company’s health. CDSL currently has no debt on its balance sheet. This implies that the company is running its operations purely on off equity funding. which is typically normal for a small-cap company. CDSL has plenty of financial flexibility, without debt obligations to meet in the short term, as well as the headroom to raise debt should it need to in the future.
For Central Depository Services (India), I’ve compiled three essential factors you should further research:
- Future Outlook: What are well-informed industry analysts predicting for CDSL’s future growth? Take a look at our free research report of analyst consensus for CDSL’s outlook.
- Valuation: What is CDSL worth today? Is the stock undervalued, even when its growth outlook is factored into its intrinsic value? The intrinsic value infographic in our free research report helps visualize whether CDSL is currently mispriced by the market.
- Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of CDSL? 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.