In This Article:
Today we're going to take a look at the well-established Henry Schein, Inc. (NASDAQ:HSIC). The company's stock received a lot of attention from a substantial price increase on the NASDAQGS over the last few months. As a large-cap stock with high coverage by analysts, you could assume any recent changes in the company’s outlook is already priced into the stock. However, could the stock still be trading at a relatively cheap price? Let’s examine Henry Schein’s valuation and outlook in more detail to determine if there’s still a bargain opportunity.
Check out our latest analysis for Henry Schein
Is Henry Schein still cheap?
Good news, investors! Henry Schein is still a bargain right now. My valuation model shows that the intrinsic value for the stock is $119.60, but it is currently trading at US$78.90 on the share market, meaning that there is still an opportunity to buy now. What’s more interesting is that, Henry Schein’s share price is theoretically quite stable, which could mean two things: firstly, it may take the share price a while to move to its intrinsic value, and secondly, there may be less chances to buy low in the future once it reaches that value. This is because the stock is less volatile than the wider market given its low beta.
What does the future of Henry Schein look like?
Investors looking for growth in their portfolio may want to consider the prospects of a company before buying its shares. 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. With profit expected to grow by 43% over the next couple of years, the future seems bright for Henry Schein. It looks like higher cash flow is on the cards for the stock, which should feed into a higher share valuation.
What this means for you:
Are you a shareholder? Since HSIC is currently undervalued, it may be a great time to increase your holdings in the stock. With a positive outlook on the horizon, it seems like this growth has not yet been fully factored into the share price. However, there are also other factors such as financial health to consider, which could explain the current undervaluation.
Are you a potential investor? If you’ve been keeping an eye on HSIC for a while, now might be the time to make a leap. Its buoyant future outlook isn’t fully reflected in the current share price yet, which means it’s not too late to buy HSIC. But before you make any investment decisions, consider other factors such as the strength of its balance sheet, in order to make a well-informed buy.