Is It Time To Consider Buying Jiugui Liquor Co., Ltd. (SZSE:000799)?

While Jiugui Liquor Co., Ltd. (SZSE:000799) might not have the largest market cap around , it received a lot of attention from a substantial price movement on the SZSE over the last few months, increasing to CN¥62.70 at one point, and dropping to the lows of CN¥45.93. 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 Jiugui Liquor's current trading price of CN¥46.56 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 Jiugui Liquor’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.

See our latest analysis for Jiugui Liquor

What Is Jiugui Liquor Worth?

Great news for investors – Jiugui Liquor is still trading at a fairly cheap price. Our valuation model shows that the intrinsic value for the stock is CN¥65.48, but it is currently trading at CN¥46.56 on the share market, meaning that there is still an opportunity to buy now. However, given that Jiugui Liquor’s share is fairly volatile (i.e. its price movements are magnified relative to the rest of the market) this could mean the price can sink lower, giving us another chance to buy in the future. This is based on its high beta, which is a good indicator for share price volatility.

What kind of growth will Jiugui Liquor generate?

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 more than double over the next couple of years, the future seems bright for Jiugui Liquor. 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 000799 is currently undervalued, it may be a great time to increase your holdings in the stock. With an optimistic 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 000799 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 000799. 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 buy.

Keep in mind, when it comes to analysing a stock it's worth noting the risks involved. Case in point: We've spotted 3 warning signs for Jiugui Liquor you should be mindful of and 2 of them shouldn't be ignored.

If you are no longer interested in Jiugui Liquor, 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