On January 19th this year, I recommended a French media company with a market value of €1.8 billion. As of April 5, 2012, the share price is up just over 3% so the idea is still interesting as the company is still very undervalued.

The company owns the most popular television channel in France but is also very active in new media channels including the internet, tablets and smart phones. In spite of this, the market views it as an old media company that is soon going the way of the dinosaur.

However, when you look at the financial statements of the company you will see what a great business it is. Its balance sheet is solid with hardly any debt, and it generates a high amount of free cash flow and profits. This enables it to pay a dividend of nearly 6.5% that can be maintained and has room to increase.