Yahoo Finance OZ Minerals Limited (ASX:OZL): A Fundamentally Attractive Investment
I’ve been keeping an eye on OZ Minerals Limited (ASX:OZL) because I’m attracted to its fundamentals. Looking at the company as a whole, as a potential stock investment, I believe OZL has a lot to offer. Basically, it is a financially-healthy company with a an impressive track record of performance, trading at a great value. 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 OZ Minerals here.
Flawless balance sheet and undervalued
Over the past few years, OZL has more than doubled its earnings, with its most recent figure exceeding its annual average over the past five years. Not only did OZL outperformed its past performance, its growth also exceeded the Metals and Mining industry expansion, which generated a 18.18% earnings growth. This paints a buoyant picture for the company. OZL’s ability to maintain an adequate level of cash to meet upcoming liabilities is a good sign for its financial health. This suggests prudent control over cash and cost by management, which is a crucial insight into the health of the company. Looking at OZL’s capital structure, the company has no debt on its balance sheet. It has only utilized funding from its equity capital to run the business, which is rather impressive for a AU$3.08B market cap company. Therefore the company has plenty of headroom to grow, and the ability to raise debt should it need to in the future.
OZL’s share price is trading at below its true value, meaning that the market sentiment for the stock is currently bearish. 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. Also, relative to the rest of its peers with similar levels of earnings, OZL’s share price is trading below the group’s average. This supports the theory that OZL is potentially underpriced.
Next Steps:
For OZ Minerals, I’ve put together three relevant factors you should further research:
Future Outlook: What are well-informed industry analysts predicting for OZL’s future growth? Take a look at our free research report of analyst consensus for OZL’s outlook.
Dividend Income vs Capital Gains: Does OZL 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 OZL as an investment.
Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of OZL? 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.
