Should You Investigate Cargojet Inc. (TSE:CJT) At CA$130?

While Cargojet Inc. (TSE:CJT) might not have the largest market cap around , it saw a decent share price growth of 20% on the TSX over the last few months. While good news for shareholders, the company has traded much higher in the past year. With many analysts covering the stock, we may expect any price-sensitive announcements have already been factored into the stock’s share price. However, could the stock still be trading at a relatively cheap price? Today we will analyse the most recent data on Cargojet’s outlook and valuation to see if the opportunity still exists.

Check out our latest analysis for Cargojet

What Is Cargojet Worth?

According to our valuation model, Cargojet seems to be fairly priced at around 7.98% above our intrinsic value, which means if you buy Cargojet today, you’d be paying a relatively reasonable price for it. And if you believe the company’s true value is CA$120.77, then there isn’t really any room for the share price grow beyond what it’s currently trading. In addition to this, Cargojet has a low beta, which suggests its share price is less volatile than the wider market.

What does the future of Cargojet look like?

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. Cargojet's earnings over the next few years are expected to double, indicating a very optimistic future ahead. This should lead to stronger cash flows, feeding into a higher share value.

What This Means For You

Are you a shareholder? It seems like the market has already priced in CJT’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 track record of its management team. Have these factors changed since the last time you looked at the stock? Will you have enough conviction to buy should the price fluctuates below the true value?

Are you a potential investor? If you’ve been keeping an eye on CJT, 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.

If you'd like to know more about Cargojet as a business, it's important to be aware of any risks it's facing. To that end, you should learn about the 4 warning signs we've spotted with Cargojet (including 1 which doesn't sit too well with us).

If you are no longer interested in Cargojet, 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com