Is Now The Time To Look At Buying Yunnan Energy New Material Co., Ltd. (SZSE:002812)?

Yunnan Energy New Material Co., Ltd. (SZSE:002812), is not the largest company out there, but it saw a double-digit share price rise of over 10% in the past couple of months on the SZSE. While good news for shareholders, the company has traded much higher in the past year. 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 examine Yunnan Energy New Material’s valuation and outlook in more detail to determine if there’s still a bargain opportunity.

Check out our latest analysis for Yunnan Energy New Material

Is Yunnan Energy New Material Still Cheap?

Great news for investors – Yunnan Energy New Material is still trading at a fairly cheap price. According to our valuation, the intrinsic value for the stock is CN¥64.36, which is above what the market is valuing the company at the moment. This indicates a potential opportunity to buy low. However, given that Yunnan Energy New Material’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 does the future of Yunnan Energy New Material look like?

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. Yunnan Energy New Material's earnings over the next few years are expected to increase by 46%, 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? Since 002812 is currently undervalued, it may be a great time to accumulate more of 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 financial health to consider, which could explain the current undervaluation.

Are you a potential investor? If you’ve been keeping an eye on 002812 for a while, now might be the time to make a leap. Its prosperous future outlook isn’t fully reflected in the current share price yet, which means it’s not too late to buy 002812. 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 investment decision.

If you'd like to know more about Yunnan Energy New Material as a business, it's important to be aware of any risks it's facing. You'd be interested to know, that we found 3 warning signs for Yunnan Energy New Material and you'll want to know about them.

If you are no longer interested in Yunnan Energy New Material, 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.