July Fundamental Stock Pick: National Steel and Agro Industries Limited (NSE:NATNLSTEEL)

Attractive stocks have exceptional fundamentals. In the case of National Steel and Agro Industries Limited (NSE:NATNLSTEEL), there’s is a financially-sound company with a a excellent growth outlook, not yet factored into the price. Below is a brief commentary on these key aspects. For those interested in understanding where the figures come from and want to see the analysis, read the full report on National Steel and Agro Industries here.

Very undervalued with reasonable growth potential

NATNLSTEEL’s share price is trading at below its true value, meaning that the market sentiment for the stock is currently bearish. 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, NATNLSTEEL’s share price is trading below the group’s average. This supports the theory that NATNLSTEEL is potentially underpriced.

NSEI:NATNLSTEEL Future Profit July 26th 18
NSEI:NATNLSTEEL Future Profit July 26th 18

NATNLSTEEL’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 indicates that NATNLSTEEL has sufficient cash flows and proper cash management in place, which is a crucial insight into the health of the company. NATNLSTEEL appears to have made good use of debt, producing operating cash levels of 0.71x total debt in the prior year. This is a strong indication that debt is reasonably met with cash generated.

NSEI:NATNLSTEEL Historical Debt July 26th 18
NSEI:NATNLSTEEL Historical Debt July 26th 18

Next Steps:

For National Steel and Agro Industries, there are three important factors you should further examine:

  1. Historical Performance: What has NATNLSTEEL’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.
  2. Dividend Income vs Capital Gains: Does NATNLSTEEL 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 NATNLSTEEL as an investment.
  3. Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of NATNLSTEEL? 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 editorial-team@simplywallst.com.