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MTY Food Group Inc. (TSE:MTY), might not be a large cap stock, but it saw a decent share price growth of 12% on the TSX over the last few months. While good news for shareholders, the company has traded much higher in the past year. With many analysts covering the stock, we may expect any price-sensitive announcements have already been factored into the stock’s share price. But what if there is still an opportunity to buy? Let’s take a look at MTY Food Group’s outlook and value based on the most recent financial data to see if the opportunity still exists.
View our latest analysis for MTY Food Group
Is MTY Food Group Still Cheap?
Good news, investors! MTY Food Group is still a bargain right now. According to our valuation, the intrinsic value for the stock is CA$74.42, but it is currently trading at CA$45.96 on the share market, meaning that there is still an opportunity to buy now. What’s more interesting is that, MTY Food Group’s share price is quite volatile, which gives us more chances to buy since the share price could sink lower (or rise higher) in the future. 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.
What kind of growth will MTY Food Group generate?
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. Though in the case of MTY Food Group, it is expected to deliver a relatively unexciting top-line growth of 1.0% in the next few years, which doesn’t help build up its investment thesis. Growth doesn’t appear to be a main reason for a buy decision for the company, at least in the near term.
What This Means For You
Are you a shareholder? Even though growth is relatively muted, since MTY is currently undervalued, it may be a great time to accumulate more of your holdings in the stock. However, there are also other factors such as capital structure to consider, which could explain the current undervaluation.
Are you a potential investor? If you’ve been keeping an eye on MTY for a while, now might be the time to enter the stock. Its future outlook isn’t fully reflected in the current share price yet, which means it’s not too late to buy MTY. But before you make any investment decisions, consider other factors such as the track record of its management team, in order to make a well-informed investment decision.