Yahoo Finance Spotlight On Technology One Limited’s (ASX:TNE) Fundamentals
Building up an investment case requires looking at a stock holistically. Today I’ve chosen to put the spotlight on Technology One Limited (ASX:TNE) due to its excellent fundamentals in more than one area. TNE is a financially-robust company with an impressive track record and an optimistic future outlook. 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, read the full report on Technology One here.
Excellent balance sheet with reasonable growth potential and pays a dividend
Investors seeking high cash growth potential should consider TNE, with forecasted operating cash flow growth of 94.80%. This is expected to flow down into an impressive return on equity of 30.92% over the next couple of years. TNE has a strong track record of performance. In the previous year, TNE delivered an impressive double-digit return of 31.03% Unsurprisingly, TNE surpassed the Software industry return of 20.59%, which gives us more confidence of the company’s capacity to drive earnings going forward.
TNE’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 suggests prudent control over cash and cost by management, which is a key determinant of the company’s health. TNE’s has produced operating cash levels of 4179x total debt over the past year, which implies that TNE’s management has put its borrowings into good use by generating enough cash to cover a sufficient portion of borrowings.
Next Steps:
For Technology One, there are three fundamental aspects you should further examine:
Valuation: What is TNE 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 TNE is currently mispriced by the market.
Dividend Income vs Capital Gains: Does TNE 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 TNE as an investment.
Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of TNE? 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.
