Is Now The Time To Look At Buying Dätwyler Holding AG (VTX:DAE)?

While Dätwyler Holding AG (VTX:DAE) might not be the most widely known stock at the moment, it received a lot of attention from a substantial price increase on the SWX over the last few months. With many analysts covering the mid-cap 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? Today I will analyse the most recent data on Dätwyler Holding’s outlook and valuation to see if the opportunity still exists.

View our latest analysis for Dätwyler Holding

What is Dätwyler Holding worth?

The stock is currently trading at CHF272 on the share market, which means it is overvalued by 34% compared to my intrinsic value of CHF202.29. This means that the opportunity to buy Dätwyler Holding at a good price has disappeared! If you like the stock, you may want to keep an eye out for a potential price decline in the future. Since Dätwyler Holding’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.

What does the future of Dätwyler Holding look like?

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. However, with a negative profit growth of -6.2% expected next year, near-term growth certainly doesn’t appear to be a driver for a buy decision for Dätwyler Holding. This certainty tips the risk-return scale towards higher risk.

What this means for you:

Are you a shareholder? If you believe DAE 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. Given the uncertainty from negative growth in the future, this could be the right time to de-risk your portfolio. 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 DAE for some time, now may not be the best time to enter into the stock. Its price has risen beyond its true value, on top of a negative future outlook. However, there are also other important factors which we haven’t considered today, such as the track record of its management. Should the price fall in the future, will you be well-informed enough to buy?

With this in mind, we wouldn't consider investing in a stock unless we had a thorough understanding of the risks. Every company has risks, and we've spotted 1 warning sign for Dätwyler Holding you should know about.

If you are no longer interested in Dätwyler Holding, 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. 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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