Indian Energy Exchange Limited is a company established in 2007 and has its headquarters situated in New Delhi, India. The company offers risk management and price discovery for the investors participating in the power sector.
IEX share price analysis – Is Indian energy exchange limited a good company to invest in?
Investing in stocks requires in-depth analysis and research of the financial performance of a company to determine its actual worth. This is usually done by taking the company’s cash flow reports, profit & loss account, and balance sheet into consideration. However, it can be a time-consuming and daunting task. Thankfully, there are stock analysis metrics such as the financial ratios, that can help in determining the overall performance of the company or a stock. [Check out the below link to learn more about IEX Share Price:
Below are some of the key financial ratios of IEX stock, you can take consider to make an informed decision :
Price to Earnings Ratio shows whether the stock is overvalued or undervalued. Generally, if the shares are having a low P/E value, it means they are undervalued. Talking about IEX share, it has a P/E value of 76.59, which is higher and hence, it is overvalued.
ROA (Return on Assets)
Return on Assets is a metric that helps in determining how well a company can gain returns on its investments. In simple words, the value of ROA determines if a company can use the money to buy assets into net profits. IEX share has a ROA value of 26.76%, which is a good indicator.
The current ratio shows the ability of a company to pay its liability using its short-term assets. Generally, the higher value of the current ratio is a good sign for the investors as it indicates that the company is stable and will overcome the bumps in future. The Current Ratio value of IEX is 1.85.
Return on equity (RoE)
RoE determines a company’s ability to gain profits from the investments made by its shareholders. In simple words, the ROE value shows the profit generated by oer rupee investment of the shareholders. The ROE value of Indian Energy Exch is 47.37%.
D/E Ratio (Debt to equity ratio)
Debt to equity ratio is another great metric to analyse the capital structure and performance of a company. IEX share has a D/E value of 0, which tells that the company has minimum debt, another great sign for investors.
Indian Energy Exchange Ltd. has a sales growth of 23.38%, which determines its increased performance.
The dividend yield is an indicator of the dividend investors will receive after investing in a stock. The latest year dividend of IEX share is ₹4 and yield is 0.67%.
Should you invest in IEX or not?
Currently, the IEX Share Price is ₹598, which is showing continuous growth from the past few years.
Below are the pros and cons of IEX that will help you in making an informed decision:
- Past three years of profit margin of 17.48%
- Healthy ROE value of 48.72% over a period of the last 3 years.
- Maintaining a great ROCE value of 64.34% over a period of the last 3 years.
- Good interest coverage of 138.14.
- Great operating margins from the last 5 years, 78.73%.
- As for the cons, IEX has a high PE value of 76.59 and EV of 54.94. Further, the revenue growth of the company is also not great.
As you can see, the cons of IEX are minor as compared to its strengths. This indicates, it is a great share to invest in. However, to and sound investment, do your research before making any informed decision.