At CN¥14.87, Is Wanda Film Holding Co., Ltd. (SZSE:002739) Worth Looking At Closely?

Wanda Film Holding Co., Ltd. (SZSE:002739), might not be a large cap stock, but it saw a significant share price rise of 48% 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. But what if there is still an opportunity to buy? Let’s examine Wanda Film Holding’s valuation and outlook in more detail to determine if there’s still a bargain opportunity.

View our latest analysis for Wanda Film Holding

Is Wanda Film Holding Still Cheap?

According to our valuation model, Wanda Film Holding seems to be fairly priced at around 19% below our intrinsic value, which means if you buy Wanda Film Holding today, you’d be paying a fair price for it. And if you believe the company’s true value is CN¥18.38, then there’s not much of an upside to gain from mispricing. Is there another opportunity to buy low in the future? Since Wanda Film Holding’s share price is quite volatile, we could potentially see it sink lower (or rise higher) in the future, giving us another chance to buy. This is based on its high beta, which is a good indicator for how much the stock moves relative to the rest of the market.

What kind of growth will Wanda Film Holding generate?

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 revenues expected to grow by 33% over the next couple of years, the future seems bright for Wanda Film Holding. If the level of expenses is able to be maintained, 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? 002739’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 002739, now may not be the most optimal time to buy, given it is trading around its fair value. However, the optimistic prospect 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.

Diving deeper into the forecasts for Wanda Film Holding mentioned earlier will help you understand how analysts view the stock going forward. At Simply Wall St, we have the analysts estimates which you can view by clicking here.

If you are no longer interested in Wanda Film Holding, 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.