Should You Think About Buying Zoomlion Heavy Industry Science and Technology Co., Ltd. (SZSE:000157) Now?

Zoomlion Heavy Industry Science and Technology Co., Ltd. (SZSE:000157), is not the largest company out there, but it saw a significant share price rise of 22% in the past couple of months on the SZSE. The recent rally in share prices has nudged the company in the right direction, though it still falls short of its yearly peak. As a mid-cap stock with high coverage by analysts, you could assume any recent changes in the company’s outlook is already priced into the stock. However, could the stock still be trading at a relatively cheap price? Let’s take a look at Zoomlion Heavy Industry Science and Technology’s outlook and value based on the most recent financial data to see if the opportunity still exists.

Check out our latest analysis for Zoomlion Heavy Industry Science and Technology

What's The Opportunity In Zoomlion Heavy Industry Science and Technology?

Good news, investors! Zoomlion Heavy Industry Science and Technology is still a bargain right now. According to our valuation, the intrinsic value for the stock is CN¥11.44, but it is currently trading at CN¥7.01 on the share market, meaning that there is still an opportunity to buy now. What’s more interesting is that, Zoomlion Heavy Industry Science and Technology’s share price is theoretically quite stable, which could mean two things: firstly, it may take the share price a while to move to its intrinsic value, and secondly, there may be less chances to buy low in the future once it reaches that value. This is because the stock is less volatile than the wider market given its low beta.

Can we expect growth from Zoomlion Heavy Industry Science and Technology?

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. With profit expected to grow by 58% over the next couple of years, the future seems bright for Zoomlion Heavy Industry Science and Technology. 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 000157 is currently undervalued, it may be a great time to increase 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 capital structure to consider, which could explain the current undervaluation.

Are you a potential investor? If you’ve been keeping an eye on 000157 for a while, now might be the time to enter the stock. Its buoyant future outlook isn’t fully reflected in the current share price yet, which means it’s not too late to buy 000157. But before you make any investment decisions, consider other factors such as the strength of its balance sheet, in order to make a well-informed 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 3 warning signs for Zoomlion Heavy Industry Science and Technology you should know about.

If you are no longer interested in Zoomlion Heavy Industry Science and Technology, you can use our free platform to see our list of over 50 other stocks with a high growth potential.

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

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.