New Value Analysis of Treatt Plc (LSE:TET)
New Value Analysis of Treatt Plc (LSE:TET)
A new value analysis of Treatt Plc (LSE:TET), a company listed on the London Stock exchange, has been added to our research pages here. Treatt Plc is an ingredient manufacturer with customers in the flavour, fragrance and personal care industries.
Why would a value investor consider an investment in Treatt Plc?
The value analysis of Treatt Plc shows that the company is very conservatively run. The financial structure of the company reveals low debt levels on any metric of earnings or company size to debt. Low debt levels are important to owners of the common stock. Low debt levels mean that there is low risk of bankruptcy and most of the returns made by the company will be available to owners of the common stock.
The conservative financial structure creates a margin of safety and the potential for returns for owners of the common stock. The opposite of a margin of safety would be if the company had significant debt levels, which creates risk for owners of the common stock. Value investors prefer to own the debt securities in highly indebted companies. Common stock owners receive protection if their management maintains a conservative approach to corporate financing.
The conservative financial structure allows owners of the common stock to be the significant beneficiaries of the returns created by management. In particular value investors look for a good return on equity to assess the ability of management to create value from the financial assets given to them. Treatt Plc has a very good return on equity number.
Treatt Plc looks like an excellent company in a niche industry conservatively managed. the only question for value investors is whether the current price is a good one to make an investment. Prior to the 2013 Annual results Treatt Plc underwent a 5 for 1 stock split. It is possible that the stock split has led to a misplacing of the common stock. the current price is the cautionary statistic for value investors.
To find out if a value investor should consider an investment in Treatt Plc common stock click here to download the new analysis.
OR
Click the button below to review options on becoming a member.
Free sample
For a free sample of the type of analysis you get from our reports please click Apple Inc or download the PDF on the link below.
[smlsubform prepend=”To receive updates when we add content to our website please use this form to register your e-mail”]
