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An Examination Of Breville Group Limited (ASX:BRG)

Breville Group Limited (ASX:BRG) is a stock with outstanding fundamental characteristics. When we build an investment case, we need to look at the stock with a holistic perspective. In the case of BRG, it is a financially-robust company with an impressive history and a excellent future outlook. Below, I’ve touched on some key aspects you should know on a high level. For those interested in digger a bit deeper into my commentary, take a look at the report on Breville Group here.

Excellent balance sheet with solid track record and pays a dividend

In the previous year, BRG has ramped up its bottom line by 8.7%, with its latest earnings level surpassing its average level over the last five years. This illustrates a strong track record, leading to a satisfying return on equity of 21%. which is an optimistic signal for the future.

ASX:BRG Future Profit November 10th 18
ASX:BRG Future Profit November 10th 18

BRG’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 an important determinant of the company’s health. BRG’s has produced operating cash levels of 1.96x total debt over the past year, which implies that BRG’s management has put its borrowings into good use by generating enough cash to cover a sufficient portion of borrowings.

ASX:BRG Historical Debt November 10th 18
ASX:BRG Historical Debt November 10th 18

Next Steps:

For Breville Group, I’ve compiled three key factors you should further examine:

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  1. Valuation: What is BRG 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 BRG is currently mispriced by the market.

  2. Dividend Income vs Capital Gains: Does BRG 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 BRG as an investment.

  3. Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of BRG? 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 past 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. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.