Founded in by brothers Tom and David Gardner, The Motley Fool helps millions of people attain financial freedom through our website, podcasts, books, newspaper column, radio show, and premium investing services. LONDON -- To me, capital growth and dividend income are equally important.

Together, they provide the total return from any share investment, and, as you might expect, my aim is to invest in companies that can beat the total return delivered by the wider market.

Quality and value If my investments are to outperform, I need to back companies that score well on several quality indicators and buy at prices that offer decent value. GKN , which is a global engineering company. GKN is an engineering group employing around 44, people in more than 35 countries.

The firm reckons its technologies and products are at the heart of vehicles and aircraft produced by the world's leading manufacturers. Indeed, its products, such as drive shafts and axle joints, are responsible for making most of the cars around the world move. It's clear from the table that GKN's markets are cyclical.

In fact, the company required a dilutive 6-for-5 rights issue in that raised about million pounds to pay down some of its debt and support its balance sheet. The company issued around million new shares, roughly doubling the share count. It's often a good idea to hold cyclical, high-beta shares on the up-leg of economic cycles.

If the current recovery proves to be enduring, GKN could offer investors decent total-return potential from here.

GKN's total-return potential Let's examine five indicators to help judge the quality of the company's total-return potential:. Foolish summary Since raising more money on the stock market during , GKN seems to have gotten its debt under control. Cash flow has come back from its nadir in , and there's reasonable free-cash dividend cover and plenty of cash to meet interest payments. One thing noticeable from the table of results is that the business has grown beyond a mere cyclical recovery; all of revenue, profits, and cash flow now comfortably exceed the pre-crisis levels seen in , although earnings-per-share figures are down because of the rights-issue dilution.

Yes, GKN is a growing business, although the latest company guidance sees the directors speak of softening demand in some areas. Despite the fivefold share price increase since the dark days of , I'm happy to put GKN on my watch list and may even buy the shares if something knocks them back.

GKN | The Motley Fool UK

Generally, I'm more likely to buy shares when a company hits a spot of bother, as that's often when I find bargains. Investors tend to like bargains, as share price recovery from low levels can lead to enhanced total returns. Right now, on one selection I find myself in the company of master investor Warren Buffett. In fact, the share in question is the only publicly listed U.

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Share That Warren Buffett Loves. Kevin Godbold and The Motley Fool have no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days.

GKN Share Price | GKN Stock News | Interactive Investor

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Jan 28, at 5: Year to December Revenue millions of pounds 3, 4, 4, 5, 5, Net cash from operations millions of pounds 33 Adjusted earnings per share pence Prev 1 2 3 4 Next.

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