Copenhagen Stock Exchange: Focus: Investors Should Focus On Capital Structure And Cash Flows

In Focus no. 47 equity analyst Bjørn Schwarz, Sydbank Markets, describes how focus has increasingly returned to the companies’ capital structure and cash flows. The companies’ capital structure reflects the financial risk and indicates how well prepared a company is to ‘major blows’ to the balance sheet.

In periods of dropping share prices, the investors will be much more interested in shares with a direct yield in the form of dividend payment. An alternative to dividend payment are the companies’ buy-back schemes, which have become more and more popular throughout the last years. The author gives examples of Danish companies that remunerate the investors through dividend or buy-back schemes.

Bjørn Schwarz looks at the investment openings in a number of Danish companies, for the patient investor, based on the following five criteria:

Cash flows
Yield shares
Capital structure
Takeover candidates
Non-cyclical shares

as well as Sydbank’s valuation of the shares’ current pricing.

Read the entire article "Emu convergence in the Swedish and Danish bond markets" in Focus no. 47 on the Copenhagen Stock Exchange’s website www.cse.dk.