Sterling Bancorp (NYSE:STL), operating in the financial services industry based in United States, maintained its current share price over the past couple of month on the NYSE, with a relatively tight range of US$19.62 to US$21.58. However, does this price actually reflect the true value of the mid-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let’s take a look at Sterling Bancorp’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.
What is Sterling Bancorp worth?
Good news, investors! Sterling Bancorp is still a bargain right now. According to my valuation, the intrinsic value for the stock is $38.23, which is above what the market is valuing the company at the moment. This indicates a potential opportunity to buy low. However, given that Sterling Bancorp’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 Sterling Bancorp 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. Though in the case of Sterling Bancorp, it is expected to deliver a relatively unexciting earnings growth of 3.1%, which doesn’t help build up its investment thesis. Growth doesn’t appear to be a main reason for a buy decision for the company, at least in the near term.
What this means for you:
Are you a shareholder? Even though growth is relatively muted, since STL is currently undervalued, it may be a great time to accumulate more of your holdings in the stock. 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 STL for a while, now might be the time to enter the stock. Its future outlook isn’t fully reflected in the current share price yet, which means it’s not too late to buy STL. 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.
Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on Sterling Bancorp. You can find everything you need to know about Sterling Bancorp in the latest infographic research report. If you are no longer interested in Sterling Bancorp, you can use our free platform to see my list of over 50 other stocks with a high growth potential.
If you spot an error that warrants correction, please contact the editor at email@example.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned.
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