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Mahanagar Gas Limited (NSE:MGL) is a stock with outstanding fundamental characteristics. When we build an investment case, we need to look at the stock with a holistic perspective. In the case of MGL, it is a financially-sound , dividend-paying company with a a great track record of performance. 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 Mahanagar Gas here.
Flawless balance sheet with solid track record and pays a dividend
In the previous year, MGL has ramped up its bottom line by 14%, with its latest earnings level surpassing its average level over the last five years. This illustrates a strong track record, leading to a satisfying return on equity of 23%. which is an notable feat for the company. MGL’s ability to maintain an adequate level of cash to meet upcoming liabilities is a good sign for its financial health. This indicates that MGL has sufficient cash flows and proper cash management in place, which is a key determinant of the company’s health. Looking at MGL’s capital structure, the company has no debt on its balance sheet. This means it is running its business only on equity capital funding, which is typically normal for a small-cap company. Investors’ risk associated with debt is virtually non-existent and the company has plenty of headroom to grow debt in the future, should the need arise.
MGL’s high dividend payments make it one of the best dividend stocks on the market, and its profitability ensures that dividends are well-covered by its net income.
For Mahanagar Gas, there are three essential aspects you should further examine:
- Future Outlook: What are well-informed industry analysts predicting for MGL’s future growth? Take a look at our free research report of analyst consensus for MGL’s outlook.
- Valuation: What is MGL 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 MGL is currently mispriced by the market.
- Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of MGL? 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.