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While dormakaba Holding AG (VTX:DOKA) might not have the largest market cap around , it received a lot of attention from a substantial price movement on the SWX over the last few months, increasing to CHF477 at one point, and dropping to the lows of CHF421. 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 dormakaba Holding's current trading price of CHF462 reflective of the actual value of the mid-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let’s take a look at dormakaba Holding’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.
Check out our latest analysis for dormakaba Holding
What Is dormakaba Holding Worth?
dormakaba Holding appears to be expensive according to our price multiple model, which makes a comparison between the company's price-to-earnings ratio and the industry average. We’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 42.28x is currently well-above the industry average of 33.21x, meaning that it is trading at a more expensive price relative to its peers. But, is there another opportunity to buy low in the future? Since dormakaba Holding’s share price is quite volatile, this could mean it can sink lower (or rise even further) in the future, giving us another chance to invest. 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 dormakaba Holding generate?
Investors looking for growth in their portfolio may want to consider the prospects of a company before buying its shares. 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. dormakaba Holding's earnings over the next few years are expected to double, indicating a very optimistic future ahead. This should lead to stronger cash flows, feeding into a higher share value.
What This Means For You
Are you a shareholder? DOKA’s optimistic future growth appears to have been factored into the current share price, with shares trading above industry price multiples. However, this brings up another question – is now the right time to sell? If you believe DOKA should trade below its current price, selling high and buying it back up again when its price falls towards the industry PE ratio can be profitable. But before you make this decision, take a look at whether its fundamentals have changed.