When Should You Buy bpost SA/NV (EBR:BPOST)?

While bpost SA/NV (EBR:BPOST) might not be the most widely known stock at the moment, it saw significant share price movement during recent months on the ENXTBR, rising to highs of €10.18 and falling to the lows of €8.05. 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 bpost's current trading price of €8.14 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 bpost’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 bpost

What's the opportunity in bpost?

bpost appears to be overvalued by 34% at the moment, based on my discounted cash flow valuation. The stock is currently priced at €8.14 on the market compared to my intrinsic value of €6.09. This means that the buying opportunity has probably disappeared for now. But, is there another opportunity to buy low in the future? Given that bpost’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 kind of growth will bpost generate?

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. bpost's revenue growth are expected to be in the teens in the upcoming years, indicating a solid future ahead. Unless expenses grow at the same level, or higher, this top-line growth should lead to robust cash flows, feeding into a higher share value.

What this means for you:

Are you a shareholder? It seems like the market has well and truly priced in BPOST’s positive outlook, with shares trading above its fair value. However, this brings up another question – is now the right time to sell? If you believe BPOST 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.

Are you a potential investor? If you’ve been keeping tabs on BPOST for some time, now may not be the best time to enter into the stock. The price has surpassed its true value, which means there’s no upside from mispricing. However, the positive outlook is encouraging for BPOST, which means it’s worth diving deeper into other factors in order to take advantage of the next price drop.

If you want to dive deeper into bpost, you'd also look into what risks it is currently facing. When we did our research, we found 2 warning signs for bpost (1 is potentially serious!) that we believe deserve your full attention.

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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. 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.
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