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Vail Resorts, Inc. (NYSE:MTN), is not the largest company out there, but it received a lot of attention from a substantial price movement on the NYSE over the last few months, increasing to US$195 at one point, and dropping to the lows of US$166. 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 Vail Resorts' current trading price of US$179 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 Vail Resorts’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.
Check out our latest analysis for Vail Resorts
What's The Opportunity In Vail Resorts?
Great news for investors – Vail Resorts is still trading at a fairly cheap price. According to our valuation, the intrinsic value for the stock is $279.09, which is above what the market is valuing the company at the moment. This indicates a potential opportunity to buy low. However, given that Vail Resorts’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 Vail Resorts 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. Vail Resorts' earnings over the next few years are expected to increase by 36%, 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? Since MTN 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 capital structure to consider, which could explain the current undervaluation.
Are you a potential investor? If you’ve been keeping an eye on MTN for a while, now might be the time to make a leap. Its prosperous future outlook isn’t fully reflected in the current share price yet, which means it’s not too late to buy MTN. But before you make any investment decisions, consider other factors such as the track record of its management team, in order to make a well-informed buy.