Attractive stocks have exceptional fundamentals. In the case of Griffin Mining Limited (AIM:GFM), there’s is a financially-robust company with a a great track record of performance, trading at a discount. Below, I’ve touched on some key aspects you should know on a high level. For those interested in understanding where the figures come from and want to see the analysis, take a look at the report on Griffin Mining here.
Outstanding track record with excellent balance sheet
GFM delivered a triple-digit bottom-line expansion over the past couple of years, with its most recent earnings level surpassing its average level over the last five years. This strong performance generated a robust double-digit return on equity of 22.64%, which paints a buoyant picture for the company. GFM’s debt-to-equity ratio stands at 2.30%, which means its debt level is low. This means the company has plenty of headroom to grow, and the ability to raise debt should it need to in the future. GFM seems to have put its debt to good use, generating operating cash levels of 17.58x 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.
GFM is currently trading below its true value, which means the market is undervaluing the company’s expected cash flow going forward. 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. Compared to the rest of the metals and mining industry, GFM is also trading below its peers, relative to earnings generated. This supports the theory that GFM is potentially underpriced.
For Griffin Mining, I’ve put together three relevant factors you should further research:
- Future Outlook: What are well-informed industry analysts predicting for GFM’s future growth? Take a look at our free research report of analyst consensus for GFM’s outlook.
- Dividend Income vs Capital Gains: Does GFM 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 GFM as an investment.
- Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of GFM? 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 pass 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.