P.I.E. Industrial Berhad (KLSE:PIE), is not the largest company out there, but it received a lot of attention from a substantial price movement on the KLSE over the last few months, increasing to RM3.72 at one point, and dropping to the lows of RM2.93. 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 P.I.E. Industrial Berhad's current trading price of RM2.93 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 P.I.E. Industrial Berhad’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.
View our latest analysis for P.I.E. Industrial Berhad
What Is P.I.E. Industrial Berhad Worth?
According to my valuation model, the stock is currently overvalued by about 26%, trading at RM2.93 compared to my intrinsic value of MYR2.32. Not the best news for investors looking to buy! But, is there another opportunity to buy low in the future? Given that P.I.E. Industrial Berhad’s share is fairly volatile (i.e. its price movements are magnified relative to the rest of the market) this could mean the price can sink lower, giving us another chance to buy in the future. This is based on its high beta, which is a good indicator for share price volatility.
What does the future of P.I.E. Industrial Berhad 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. With profit expected to grow by 23% over the next year, the near-term future seems bright for P.I.E. Industrial Berhad. 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? PIE’s optimistic future growth appears to have been factored into the current share price, with shares trading above its fair value. However, this brings up another question – is now the right time to sell? If you believe PIE should trade below its current price, selling high and buying it back up again when its price falls towards its real value can be profitable. But before you make this decision, take a look at whether its fundamentals have changed.