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China Travel International Investment Hong Kong Limited (HKG:308), which is in the hospitality business, and is based in Hong Kong, saw significant share price movement during recent months on the SEHK, rising to highs of HK$2.6 and falling to the lows of HK$1.96. Some share price movements can give investors a better opportunity to enter into the stock, and potentially buy at a lower price. A question to answer is whether China Travel International Investment Hong Kong's current trading price of HK$1.96 reflective of the actual value of the small-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let’s take a look at China Travel International Investment Hong Kong’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.

View our latest analysis for China Travel International Investment Hong Kong

What's the opportunity in China Travel International Investment Hong Kong?

The stock seems fairly valued at the moment according to my relative valuation model. I’ve used the price-to-earnings ratio in this instance because there’s not enough visibility to forecast its cash flows. The stock’s ratio of 15.56x is currently trading slightly above its industry peers’ ratio of 15.34x, which means if you buy China Travel International Investment Hong Kong today, you’d be paying a relatively fair price for it. And if you believe that China Travel International Investment Hong Kong should be trading at this level in the long run, there’s only an insignificant downside when the price falls to its real value. Is there another opportunity to buy low in the future? Since China Travel International Investment Hong Kong’s share price is quite volatile, we could potentially see it sink lower (or rise higher) in the future, giving us another chance to buy. This is based on its high beta, which is a good indicator for how much the stock moves relative to the rest of the market.

Can we expect growth from China Travel International Investment Hong Kong?

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. Although value investors would argue that it’s the intrinsic value relative to the price that matter the most, a more compelling investment thesis would be high growth potential at a cheap price. China Travel International Investment Hong Kong’s earnings over the next few years are expected to increase by 22%, indicating a highly optimistic future ahead. This should lead to more robust cash flows, feeding into a higher share value.