When Should You Buy Fleury S.A. (BVMF:FLRY3)?

Fleury S.A. (BVMF:FLRY3), is not the largest company out there, but it saw a decent share price growth in the teens level on the BOVESPA over the last few months. As a stock with high coverage by analysts, you could assume any recent changes in the company’s outlook is already priced into the stock. But what if there is still an opportunity to buy? Today I will analyse the most recent data on Fleury’s outlook and valuation to see if the opportunity still exists.

See our latest analysis for Fleury

What is Fleury worth?

The stock is currently trading at R$15.09 on the share market, which means it is overvalued by 23% compared to my intrinsic value of R$12.29. Not the best news for investors looking to buy! But, is there another opportunity to buy low in the future? Since Fleury’s share price is quite volatile, this could mean it can sink lower (or rise even further) in the future, giving us another chance to invest. This is based on its high beta, which is a good indicator for how much the stock moves relative to the rest of the market.

Can we expect growth from Fleury?

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. Fleury's earnings growth are expected to be in the teens in the upcoming years, indicating a solid future ahead. This 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 FLRY3’s positive outlook, with shares trading above its fair value. At this current price, shareholders may be asking a different question – should I sell? If you believe FLRY3 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 an eye on FLRY3 for a while, 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 FLRY3, 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 Fleury, you'd also look into what risks it is currently facing. At Simply Wall St, we found 2 warning signs for Fleury and we think they deserve your attention.

If you are no longer interested in Fleury, 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.