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Nemetschek SE (ETR:NEM) saw a decent share price growth of 17% on the XTRA over the last few months. The recent share price gains has brought the company back closer to its yearly peak. With many analysts covering the large-cap stock, we may expect any price-sensitive announcements have already been factored into the stock’s share price. However, what if the stock is still a bargain? Today we will analyse the most recent data on Nemetschek’s outlook and valuation to see if the opportunity still exists.
See our latest analysis for Nemetschek
What's The Opportunity In Nemetschek?
The stock seems fairly valued at the moment according to our valuation model. It’s trading around 16.31% above our intrinsic value, which means if you buy Nemetschek today, you’d be paying a relatively reasonable price for it. And if you believe that the stock is really worth €87.27, then there isn’t really any room for the share price grow beyond what it’s currently trading. What's more, Nemetschek’s share price may be more stable over time (relative to the market), as indicated by its low beta.
What does the future of Nemetschek look like?
Future outlook is an important aspect when you’re looking at buying a stock, especially if you are an investor looking for growth in your portfolio. Buying a great company with a robust outlook at a cheap price is always a good investment, so let’s also take a look at the company's future expectations. Nemetschek's earnings over the next few years are expected to increase by 81%, indicating a highly optimistic future ahead. This should lead to more robust cash flows, feeding into a higher share value.
What This Means For You
Are you a shareholder? NEM’s optimistic future growth appears to have been factored into the current share price, with shares trading around its fair value. However, there are also other important factors which we haven’t considered today, such as the track record of its management team. Have these factors changed since the last time you looked at the stock? Will you have enough conviction to buy should the price fluctuates below the true value?
Are you a potential investor? If you’ve been keeping tabs on NEM, now may not be the most optimal time to buy, given it is trading around its fair value. However, the positive outlook is encouraging for the company, which means it’s worth diving deeper into other factors such as the strength of its balance sheet, in order to take advantage of the next price drop.
Keep in mind, when it comes to analysing a stock it's worth noting the risks involved. Case in point: We've spotted 1 warning sign for Nemetschek you should be aware of.