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ABO Energy GmbH & Co. KGaA (ETR:AB9), is not the largest company out there, but it received a lot of attention from a substantial price movement on the XTRA over the last few months, increasing to €54.60 at one point, and dropping to the lows of €42.80. 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 ABO Energy GmbH KGaA's current trading price of €46.70 reflective of the actual value of the small-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let’s take a look at ABO Energy GmbH KGaA’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 ABO Energy GmbH KGaA
Is ABO Energy GmbH KGaA Still Cheap?
Great news for investors – ABO Energy GmbH KGaA is still trading at a fairly cheap price according to our price multiple model, where we compare the company's price-to-earnings ratio to the industry average. In this instance, we’ve used the price-to-earnings (PE) ratio given that there is not enough information to reliably forecast the stock’s cash flows. we find that ABO Energy GmbH KGaA’s ratio of 14.48x is below its peer average of 18.51x, which indicates the stock is trading at a lower price compared to the Renewable Energy industry. What’s more interesting is that, ABO Energy GmbH KGaA’s share price is quite stable, which could mean two things: firstly, it may take the share price a while to move closer to its industry peers, 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.
Can we expect growth from ABO Energy GmbH KGaA?
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 a double-digit 17% over the next couple of years, the outlook is positive for ABO Energy GmbH KGaA. 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 AB9 is currently trading below the industry PE ratio, it may be a great time to increase your holdings in the stock. With a positive profit 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 price multiple.