What happened to the HSN share price?
Hansen Technologies Ltd [ASX:HSN] is one of those super-growth companies on the Australian stock exchange. The company has strong fundamentals and its price has largely reflected its amazing growth in the last decade.
What I just said is not something you can easily find in today’s press. Today’s press is all about the gloom doom of crisis. But the press is telling the truth. We are in an exceptional period, much like all those crisis points in the past. Investors are very cautious and it certainly does feel that something big can happen in Greece, China and the world.
Nothing has changed
Apart from trying to hedge yourself in this period of extreme risk, nothing has really changed. The correct investment strategy is still to have positions in fundamentally healthy companies. Buy them when they are cheap and hold onto them for an extended period of time. Hansen is such a company.
Ok, I will quote you some boring figures. The company has a P/E of 26.6. It is not too cheap, but it is acceptable given the speed of growth. Its return on equity is over 22% and its return on asset is 15.5%. The company is a financially healthy. This is why it is interesting for value investors.
What should you do with HSN shares now?
HSN is a profitable asset to trade. However, it can give volatility periodically. I recommend a well-hedged strategy and a leverage level of no more than 1.8 times. With the right trading strategy, you should have easily scored more than 100% in the last 52 weeks.
HSN continues to be a profitable asset to trade, and it is financially healthy for value investors to hold onto.
Emerging Market Analyst, New Frontier Investor