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La-Z-Boy Incorporated (NYSE:LZB), is not the largest company out there, but it saw a decent share price growth of 18% on the NYSE over the last few months. While good news for shareholders, the company has traded much higher in the past year. Less-covered, small caps sees more of an opportunity for mispricing due to the lack of information available to the public, which can be a good thing. So, could the stock still be trading at a low price relative to its actual value? Let’s examine La-Z-Boy’s valuation and outlook in more detail to determine if there’s still a bargain opportunity.
What's The Opportunity In La-Z-Boy?
Great news for investors – La-Z-Boy is still trading at a fairly cheap price. Our valuation model shows that the intrinsic value for the stock is $61.80, which is above what the market is valuing the company at the moment. This indicates a potential opportunity to buy low. Although, there may be another chance to buy again in the future. This is because La-Z-Boy’s beta (a measure of share price volatility) is high, meaning its price movements will be exaggerated relative to the rest of the market. If the market is bearish, the company's shares will likely fall by more than the rest of the market, providing a prime buying opportunity.
View our latest analysis for La-Z-Boy
Can we expect growth from La-Z-Boy?
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. La-Z-Boy's earnings over the next few years are expected to increase by 21%, 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 LZB is currently undervalued, it may be a great time to accumulate more of your holdings in the stock. With an optimistic 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 LZB for a while, now might be the time to enter the stock. Its prosperous future outlook isn’t fully reflected in the current share price yet, which means it’s not too late to buy LZB. 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 investment decision.