When Should You Buy Anhui Jinhe Industrial Co.,Ltd. (SZSE:002597)?

Anhui Jinhe Industrial Co.,Ltd. (SZSE:002597), is not the largest company out there, but it saw a decent share price growth of 19% on the SZSE over the last few months. While good news for shareholders, the company has traded much higher in the past year. As a stock with high coverage by analysts, you could assume any recent changes in the company’s outlook is already priced into the stock. But what if there is still an opportunity to buy? Let’s examine Anhui Jinhe IndustrialLtd’s valuation and outlook in more detail to determine if there’s still a bargain opportunity.

Check out our latest analysis for Anhui Jinhe IndustrialLtd

What Is Anhui Jinhe IndustrialLtd Worth?

According to our valuation model, Anhui Jinhe IndustrialLtd seems to be fairly priced at around 19% below our intrinsic value, which means if you buy Anhui Jinhe IndustrialLtd today, you’d be paying a fair price for it. And if you believe that the stock is really worth CN¥26.17, then there’s not much of an upside to gain from mispricing. Furthermore, Anhui Jinhe IndustrialLtd’s low beta implies that the stock is less volatile than the wider market.

Can we expect growth from Anhui Jinhe IndustrialLtd?

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. 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. Anhui Jinhe IndustrialLtd's earnings over the next few years are expected to increase by 82%, indicating a highly optimistic future ahead. This should lead to more robust cash flows, feeding into a higher share value.

What This Means For You

Are you a shareholder? 002597’s optimistic future growth appears to have been factored into the current share price, 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 confidence to invest in the company should the price drop below its fair value?

Are you a potential investor? If you’ve been keeping tabs on 002597, now may not be the most optimal time to buy, given it is trading around its fair value. However, the positive outlook 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.

In light of this, if you'd like to do more analysis on the company, it's vital to be informed of the risks involved. For example, we've discovered 2 warning signs that you should run your eye over to get a better picture of Anhui Jinhe IndustrialLtd.

If you are no longer interested in Anhui Jinhe IndustrialLtd, 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.