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Henry Schein, Inc. (NASDAQ:HSIC), might not be a large cap stock, but it saw significant share price movement during recent months on the NASDAQGS, rising to highs of US$77.66 and falling to the lows of US$66.54. 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 Henry Schein's current trading price of US$73.18 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 Henry Schein’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 Henry Schein
What Is Henry Schein Worth?
According to our valuation model, Henry Schein seems to be fairly priced at around 6.42% above our intrinsic value, which means if you buy Henry Schein today, you’d be paying a relatively reasonable price for it. And if you believe that the stock is really worth $68.77, then there isn’t really any room for the share price grow beyond what it’s currently trading. What's more, Henry Schein’s share price may be more stable over time (relative to the market), as indicated by its low beta.
What does the future of Henry Schein look like?
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. Henry Schein's earnings over the next few years are expected to increase by 92%, indicating a highly optimistic future ahead. This should lead to more robust cash flows, feeding into a higher share value.
What This Means For You
Are you a shareholder? HSIC’s optimistic future growth appears to have been factored into the current share price, with shares trading around its fair value. However, there are also other important factors which we haven’t considered today, such as the financial strength of the company. 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 tabs on HSIC, now may not be the most optimal time to buy, given it is trading around its fair value. However, the positive outlook 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.