Is It Time To Consider Buying Eckert & Ziegler Strahlen- und Medizintechnik AG (ETR:EUZ)?

Eckert & Ziegler Strahlen- und Medizintechnik AG (ETR:EUZ), is not the largest company out there, but it saw significant share price movement during recent months on the XTRA, rising to highs of €56.85 and falling to the lows of €37.02. Some share price movements can give investors a better opportunity to enter into the stock, and potentially buy at a lower price. A question to answer is whether Eckert & Ziegler Strahlen- und Medizintechnik's current trading price of €37.02 reflective of the actual value of the small-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let’s take a look at Eckert & Ziegler Strahlen- und Medizintechnik’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.

Check out our latest analysis for Eckert & Ziegler Strahlen- und Medizintechnik

What Is Eckert & Ziegler Strahlen- und Medizintechnik Worth?

According to my price multiple model, which makes a comparison between the company's price-to-earnings ratio and the industry average, the stock price seems to be justfied. In this instance, I’ve used the price-to-earnings (PE) ratio given that there is not enough information to reliably forecast the stock’s cash flows. I find that Eckert & Ziegler Strahlen- und Medizintechnik’s ratio of 28.03x is trading slightly below its industry peers’ ratio of 30.92x, which means if you buy Eckert & Ziegler Strahlen- und Medizintechnik today, you’d be paying a reasonable price for it. And if you believe Eckert & Ziegler Strahlen- und Medizintechnik 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. Is there another opportunity to buy low in the future? Since Eckert & Ziegler Strahlen- und Medizintechnik’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 Eckert & Ziegler Strahlen- und Medizintechnik generate?

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. However, with a relatively muted profit growth of 6.8% expected over the next year, growth doesn’t seem like a key driver for a buy decision for Eckert & Ziegler Strahlen- und Medizintechnik, at least in the short term.

What This Means For You

Are you a shareholder? It seems like the market has already priced in EUZ’s growth outlook, with shares trading around industry price multiples. 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 EUZ? Will you have enough conviction to buy should the price fluctuate below the industry PE ratio?

Are you a potential investor? If you’ve been keeping tabs on EUZ, now may not be the most optimal time to buy, given it is trading around industry price multiples. However, the positive growth outlook may mean it’s worth diving deeper into other factors in order to take advantage of the next price drop.

Since timing is quite important when it comes to individual stock picking, it's worth taking a look at what those latest analysts forecasts are. At Simply Wall St, we have the analysts estimates which you can view by clicking here.

If you are no longer interested in Eckert & Ziegler Strahlen- und Medizintechnik, 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.