Why We Think Great Canadian Gaming Corporation (TSE:GC) Could Be Worth Looking At

Building up an investment case requires looking at a stock holistically. Today I’ve chosen to put the spotlight on Great Canadian Gaming Corporation (TSE:GC) due to its excellent fundamentals in more than one area. GC is a financially-robust company with an impressive track record and a buoyant growth outlook. In the following section, I expand a bit more on these key aspects. For those interested in digger a bit deeper into my commentary, read the full report on Great Canadian Gaming here.

Outstanding track record with reasonable growth potential

One reason why investors are attracted to GC is its notable earnings growth potential in the near future of 37%. The optimistic bottom-line growth is supported by an outstanding revenue growth of 53% over the same time period, which indicates that earnings is driven by top-line activity rather than purely unsustainable cost-reduction initiatives. Over the past year, GC has grown its earnings by 57%, with its most recent figure exceeding its annual average over the past five years. The strong earnings growth is reflected in impressive double-digit 28% return to shareholders, which is what investors like to see!

TSX:GC Future Profit November 30th 18

GC’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. GC appears to have made good use of debt, producing operating cash levels of 0.51x total debt in the prior year. This is a strong indication that debt is reasonably met with cash generated.

TSX:GC Historical Debt November 30th 18

Next Steps:

For Great Canadian Gaming, I’ve compiled three relevant aspects you should further research:

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

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

3. Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of GC? 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.