"If we can analyze a company's earnings or cash-flow prospects, we're as comfortable buying that as anything else".
Questar has bright cash-flow prospects.
But the larger, macro-message in these cuts is a little disconcerting: Just as dividend increases signal cash-flow optimism, these cuts could be a credible signal that managements do not see a quick turnaround in their cash-flow prospects.
We scrutinize a firm's financial strength, cash flow, management, prospects for growth, contracts and other crucial factors to ensure that the company is rock-solid and its shares are reasonably priced.
Galileo did so because it felt that the stock market did not value the company's financial performance, cash flow and growth prospects highly enough.
"Supported by our strong balance sheet, robust generation of free cash flow and excellent growth prospects, this new program and last week's increase in our regular quarterly cash dividend further advance our commitment to return value directly to our shareholders," Chief Executive Officer Dick Parsons said Wednesday.
Once the companies are ranked, Mr. Perkins examines the cash flow of the most attractive prospects and looks at their balance sheets to rule out those with too much debt".We're not after buying really cheap stocks; we like to buy really cheap stocks that ultimately have growth ahead of them," he said.
Evraz, the Russian steel maker where he holds a 31% stake, has announced a plan to return up to $375m to shareholders after its strong cash flow last year and its improved prospects for 2015, despite currency concerns and the current sanctions against the company.
"But we knew we had plenty of cash flow and some very good prospects".
Corporate bonds have credit risk, and therefore must be analyzed based on the company's business prospects and cash flow.
Business prospects and cash flow are different a company might have a bright future, but might not have the current cash flow to meet its debt obligations.
