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Bechtle AG (ETR:BC8), is not the largest company out there, but it saw significant share price movement during recent months on the XTRA, rising to highs of €36.22 and falling to the lows of €29.60. 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 Bechtle's current trading price of €31.32 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 Bechtle’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.
See our latest analysis for Bechtle
What's The Opportunity In Bechtle?
According to our valuation model, Bechtle seems to be fairly priced at around 7.7% below our intrinsic value, which means if you buy Bechtle today, you’d be paying a reasonable price for it. And if you believe the company’s true value is €33.92, then there’s not much of an upside to gain from mispricing. Furthermore, Bechtle’s low beta implies that the stock is less volatile than the wider market.
What kind of growth will Bechtle 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. Bechtle's earnings growth are expected to be in the teens in the upcoming years, indicating a solid future ahead. This should lead to robust cash flows, feeding into a higher share value.
What This Means For You
Are you a shareholder? It seems like the market has already priced in BC8’s positive outlook, 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 an eye on BC8, now may not be the most advantageous time to buy, given it is trading around its fair value. However, the optimistic prospect 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.
Diving deeper into the forecasts for Bechtle mentioned earlier will help you understand how analysts view the stock going forward. Luckily, you can check out what analysts are forecasting by clicking here.