At CN¥14.43, Is Beijing Oriental Yuhong Waterproof Technology Co., Ltd. (SZSE:002271) Worth Looking At Closely?

While Beijing Oriental Yuhong Waterproof Technology Co., Ltd. (SZSE:002271) might not have the largest market cap around , it saw a significant share price rise of 46% 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 Beijing Oriental Yuhong Waterproof 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 Beijing Oriental Yuhong Waterproof Technology

What Is Beijing Oriental Yuhong Waterproof Technology Worth?

The share price seems sensible at the moment according to our price multiple model, where we compare the company's price-to-earnings ratio to the industry average. We’ve used the price-to-earnings ratio in this instance because there’s not enough visibility to forecast its cash flows. The stock’s ratio of 18.19x is currently trading slightly below its industry peers’ ratio of 19.26x, which means if you buy Beijing Oriental Yuhong Waterproof Technology today, you’d be paying a reasonable price for it. And if you believe Beijing Oriental Yuhong Waterproof Technology should be trading in this range, then there isn’t much room for the share price to grow beyond the levels of other industry peers over the long-term. In addition to this, it seems like Beijing Oriental Yuhong Waterproof Technology’s share price is quite stable, which could mean there may be less chances to buy low in the future now that it’s trading around the price multiples of other industry peers. This is because the stock is less volatile than the wider market given its low beta.

What does the future of Beijing Oriental Yuhong Waterproof Technology look like?

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. 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 56% over the next couple of years, the future seems bright for Beijing Oriental Yuhong Waterproof 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? It seems like the market has already priced in 002271’s positive outlook, with shares trading around industry price multiples. However, there are also other important factors which we haven’t considered today, such as the financial strength of the company. Have these factors changed since the last time you looked at 002271? Will you have enough confidence to invest in the company should the price drop below the industry PE ratio?

Are you a potential investor? If you’ve been keeping tabs on 002271, now may not be the most optimal time to buy, given it is trading around industry price multiples. However, the optimistic forecast is encouraging for 002271, 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 want to dive deeper into Beijing Oriental Yuhong Waterproof Technology, you'd also look into what risks it is currently facing. You'd be interested to know, that we found 1 warning sign for Beijing Oriental Yuhong Waterproof Technology and you'll want to know about this.

If you are no longer interested in Beijing Oriental Yuhong Waterproof Technology, 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.