At CN¥29.44, Is It Time To Put Pharmaron Beijing Co., Ltd. (SZSE:300759) On Your Watch List?

While Pharmaron Beijing Co., Ltd. (SZSE:300759) might not have the largest market cap around , it received a lot of attention from a substantial price increase on the SZSE over the last few months. Shareholders may appreciate the recent price jump, but the company still has a way to go before reaching its yearly highs again. 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? Today we will analyse the most recent data on Pharmaron Beijing’s outlook and valuation to see if the opportunity still exists.

Check out our latest analysis for Pharmaron Beijing

What's The Opportunity In Pharmaron Beijing?

According to our valuation model, Pharmaron Beijing seems to be fairly priced at around 5.98% above our intrinsic value, which means if you buy Pharmaron Beijing today, you’d be paying a relatively fair price for it. And if you believe the company’s true value is CN¥27.78, there’s only an insignificant downside when the price falls to its real value. In addition to this, Pharmaron Beijing has a low beta, which suggests its share price is less volatile than the wider market.

Can we expect growth from Pharmaron Beijing?

Investors looking for growth in their portfolio may want to consider the prospects of a company before buying its shares. 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. With profit expected to grow by a double-digit 13% over the next couple of years, the outlook is positive for Pharmaron Beijing. 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? 300759’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 financial strength of the company. Have these factors changed since the last time you looked at the stock? Will you have enough conviction to buy should the price fluctuates below the true value?

Are you a potential investor? If you’ve been keeping an eye on 300759, 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.

Keep in mind, when it comes to analysing a stock it's worth noting the risks involved. While conducting our analysis, we found that Pharmaron Beijing has 2 warning signs and it would be unwise to ignore them.

If you are no longer interested in Pharmaron Beijing, 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.