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 Regal Beloit Corporation (NYSE:RBC), it is a financially-healthy company with a great history superior dividend payments, trading at a discount. In the following section, I expand a bit more on these key aspects. If you're interested in understanding beyond my broad commentary, take a look at the report on Regal Beloit here.
Established dividend payer and good value
RBC's ability to maintain an adequate level of cash to meet upcoming liabilities is a good sign for its financial health. This implies that RBC manages its cash and cost levels well, which is a key determinant of the company’s health. RBC's has produced operating cash levels of 0.29x total debt over the past year, which implies that RBC's management has put its borrowings into good use by generating enough cash to cover a sufficient portion of borrowings. RBC's shares are now trading at a price below its true value based on its PE ratio of 11.75x, compared to the industry and wider stock market ratio, making it a relatively cheap stock compared to its peers.
For those seeking income streams from their portfolio, RBC is a robust dividend payer as well. Over the past decade, the company has consistently increased its dividend payout, reaching a yield of 1.7%.
For Regal Beloit, I've compiled three essential aspects you should further research:
- Future Outlook: What are well-informed industry analysts predicting for RBC’s future growth? Take a look at our free research report of analyst consensus for RBC’s outlook.
- Historical Performance: What has RBC'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 RBC? 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 [email protected]. 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.