Is Indutrade AB (publ) (STO:INDT) Potentially Underrated?

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I’ve been keeping an eye on Indutrade AB (publ) (STO:INDT) because I’m attracted to its fundamentals. Looking at the company as a whole, as a potential stock investment, I believe INDT has a lot to offer. Basically, it is a financially-sound company with a strong track record and an optimistic future outlook. In the following section, I expand a bit more on these key aspects. For those interested in digger a bit deeper into my commentary, take a look at the report on Indutrade here.

Excellent balance sheet with solid track record

INDT is expected to churn out cash in the short term, with its operating cash flow predicted to expand by 64%. This underlies the notable 22% return on equity over the next few years leading up to 2022. In the previous year, INDT has ramped up its bottom line by 33%, with its latest earnings level surpassing its average level over the last five years. This strong performance generated a robust double-digit return on equity of 22%, which is an notable feat for the company.

OM:INDT Future Profit February 15th 19
OM:INDT Future Profit February 15th 19

INDT is financially robust, with ample cash on hand and short-term investments to meet upcoming liabilities. This implies that INDT manages its cash and cost levels well, which is an important determinant of the company’s health. INDT seems to have put its debt to good use, generating operating cash levels of 0.29x total debt in the most recent year. This is also a good indication as to whether debt is properly covered by the company’s cash flows.

OM:INDT Historical Debt February 15th 19
OM:INDT Historical Debt February 15th 19

Next Steps:

For Indutrade, there are three pertinent aspects you should look at:

  1. Valuation: What is INDT 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 INDT is currently mispriced by the market.
  2. Dividend Income vs Capital Gains: Does INDT 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 INDT as an investment.
  3. Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of INDT? 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.