At AU$3.58, Is It Time To Put Beacon Lighting Group Limited (ASX:BLX) On Your Watch List?

Beacon Lighting Group Limited (ASX:BLX), is not the largest company out there, but it saw a double-digit share price rise of over 10% in the past couple of months on the ASX. The company is now trading at yearly-high levels following the recent surge in its share price. With many analysts covering the stock, we may expect any price-sensitive announcements have already been factored into the stock’s share price. But what if there is still an opportunity to buy? Let’s examine Beacon Lighting Group’s valuation and outlook in more detail to determine if there’s still a bargain opportunity.

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What's The Opportunity In Beacon Lighting Group?

The stock seems fairly valued at the moment according to our valuation model. It’s trading around 6.83% above our intrinsic value, which means if you buy Beacon Lighting Group today, you’d be paying a relatively fair price for it. And if you believe that the stock is really worth A$3.35, there’s only an insignificant downside when the price falls to its real value. In addition to this, Beacon Lighting Group has a low beta, which suggests its share price is less volatile than the wider market.

See our latest analysis for Beacon Lighting Group

Can we expect growth from Beacon Lighting Group?

Investors looking for growth in their portfolio may want to consider the prospects of a company before buying its shares. 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 35% over the next couple of years, the future seems bright for Beacon Lighting Group. 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? It seems like the market has already priced in BLX’s positive outlook, with shares trading around its fair value. However, there are also other important factors which we haven’t considered today, such as the financial strength of the company. Have these factors changed since the last time you looked at the stock? Will you have enough confidence to invest in the company should the price drop below its fair value?

Are you a potential investor? If you’ve been keeping tabs on BLX, now may not be the most advantageous time to buy, given it is trading around its fair value. However, the optimistic prospect is encouraging for the company, which means it’s worth further examining other factors such as the strength of its balance sheet, in order to take advantage of the next price drop.

It can be quite valuable to consider what analysts expect for Beacon Lighting Group from their most recent forecasts. Luckily, you can check out what analysts are forecasting by clicking here.

If you are no longer interested in Beacon Lighting Group, you can use our free platform to see our list of over 50 other stocks with a high growth potential.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.