Yahoo Finance Why Saga plc (LON:SAGA) Is An Attractive Investment
Attractive stocks have exceptional fundamentals. In the case of Saga plc (LSE:SAGA), there’s is a financially-sound company with a a great track record high-grade dividend payments, trading at a discount. Below is a brief commentary on these key aspects. For those interested in digger a bit deeper into my commentary, read the full report on Saga here.
Excellent balance sheet, good value and pays a dividend
SAGA’s debt-to-equity ratio stands at 37.25%, which means its debt level is reasonable. This implies that SAGA has a healthy balance between taking advantage of low cost debt funding as well as sufficient financial flexibility without succumbing to the strict terms of debt. SAGA appears to have made good use of debt, producing operating cash levels of 0.3x total debt in the prior year. This is a strong indication that debt is reasonably met with cash generated. SAGA’s share price is trading at below its true value, meaning that the market sentiment for the stock is currently bearish. According to my intrinsic value of the stock, which is driven by analyst consensus forecast of SAGA’s earnings, investors now have the opportunity to buy into the stock to reap capital gains. Also, relative to the rest of its peers with similar levels of earnings, SAGA’s share price is trading below the group’s average. This supports the theory that SAGA is potentially underpriced.
SAGA’s high dividend payments make it one of the best dividend stocks on the market, and it has also been able to maintain it at a level in which net income is able to cover dividend payments.
Next Steps:
For Saga, I’ve compiled three relevant factors you should further research:
Future Outlook: What are well-informed industry analysts predicting for SAGA’s future growth? Take a look at our free research report of analyst consensus for SAGA’s outlook.
Historical Performance: What has SAGA’s returns been like over the past? Go into more detail in the past track record analysis and take a look at the free visual representations of our analysis for more clarity.
Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of SAGA? 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.
