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 TGS-NOPEC Geophysical Company ASA (OB:TGS), it is a financially-healthy company with an impressive track record and a excellent growth outlook. In the following section, I expand a bit more on these key aspects. For those interested in digging a bit deeper into my commentary, take a look at the report on TGS-NOPEC Geophysical here.
Excellent balance sheet with proven track record and pays a dividend
Investors in search for stocks with room to flourish should look no further than TGS, with its expected earnings growth of 28%. The optimistic bottom-line growth is supported by an outstanding revenue growth of 67% over the same time period, which indicates that earnings is driven by top-line activity rather than purely unsustainable cost-reduction initiatives. Over the past year, TGS has grown its earnings by 89%, with its most recent figure exceeding its annual average over the past five years. In addition to beating its historical values, TGS also outperformed its industry, which delivered a growth of 5.0%. This is an notable feat for the company.
TGS'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 TGS manages its cash and cost levels well, which is a key determinant of the company’s health. TGS's has produced operating cash levels of 171x total debt over the past year, which implies that TGS's management has put its borrowings into good use by generating enough cash to cover a sufficient portion of borrowings.
For TGS-NOPEC Geophysical, I've put together three key factors you should further research:
- Valuation: What is TGS 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 TGS is currently mispriced by the market.
- Dividend Income vs Capital Gains: Does TGS 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 TGS as an investment.
- Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of TGS? 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.