Is There Now An Opportunity In Boyd Group Services Inc. (TSE:BYD)?

While Boyd Group Services Inc. (TSE:BYD) might not be the most widely known stock at the moment, it saw significant share price movement during recent months on the TSX, rising to highs of CA$216 and falling to the lows of CA$187. 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 Boyd Group Services' current trading price of CA$204 reflective of the actual value of the mid-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let’s take a look at Boyd Group Services’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 Boyd Group Services

What's the opportunity in Boyd Group Services?

Great news for investors – Boyd Group Services is still trading at a fairly cheap price. My valuation model shows that the intrinsic value for the stock is CA$267.58, but it is currently trading at CA$204 on the share market, meaning that there is still an opportunity to buy now. What’s more interesting is that, Boyd Group Services’s share price is quite volatile, which gives us more chances to buy since the share price could sink lower (or rise higher) in the future. 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 Boyd Group Services?

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. With profit expected to more than double over the next couple of years, the future seems bright for Boyd Group Services. 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? Since BYD is currently undervalued, it may be a great time to accumulate more of your holdings in the stock. With a positive 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 BYD for a while, now might be the time to make a leap. Its buoyant future outlook isn’t fully reflected in the current share price yet, which means it’s not too late to buy BYD. 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.

Keep in mind, when it comes to analysing a stock it's worth noting the risks involved. Every company has risks, and we've spotted 4 warning signs for Boyd Group Services (of which 1 can't be ignored!) you should know about.

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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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