Is Anglo Asian Mining a worthy addition to your portfolio?
Screening for companies with strong balance sheets and solid dividend yields can be a quick and simple way of identifying potentially high-quality investments that might be attractively priced. One way of doing might be to include stocks that have a Piotroski F-Score of 8 or 9 and a dividend yield of at least, say, 3%.
Take Anglo Asian Mining (LON:AAZ), for example, which is a small cap highly speculative super stock company in the Basic Materials sector. Anglo Asian Mining pays out a rolling 4.03% of its share price in dividend payments.
Does Anglo Asian Mining pass our F-Score test?
Stockopedia applies algorithms to its stream of financial data to automatically calculate the Piotroski F-Score for every stock on the market. It shows that Anglo Asian Mining scores 8 out of a possible 9.
By investing in companies scoring 8 or 9 by these measures, Piotroski showed that, over a 20-year test period through to 1996, the return earned by a value-focused investor could be increased by an astounding 7.5% each year. Even better, it suggests that the company is well-placed to continue to pay out attractive dividends.
Prospects for Anglo Asian Mining
Perhaps we can see why this is by looking at the company's most recent financial results. For the fiscal year ended 31 December 2018, Anglo Asian Mining Plc revenues increased 26% to $90.4m and net income jumped from $2.5m to $16.3m thanks to improving market conditions.
Anglo Asian Mining's improving financial condition, reasonable yield, and decent results justify further analysis.
What does this mean for potential investors?
Anglo Asian Mining has an F-Score that suggests it could be a promising investment candidate worthy of further research - but it's only a first step. Higher F-Score stocks can still have weaknesses and may trade at premium prices compared to other stocks. We've identified some areas of concern with Anglo Asian Mining that you can find out about here.
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