Is There Now An Opportunity In TAG Immobilien AG (ETR:TEG)?

TAG Immobilien AG (ETR:TEG), is not the largest company out there, but it received a lot of attention from a substantial price movement on the XTRA over the last few months, increasing to €13.38 at one point, and dropping to the lows of €11.32. 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 TAG Immobilien's current trading price of €11.32 reflective of the actual value of the mid-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let’s take a look at TAG Immobilien’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.

See our latest analysis for TAG Immobilien

What Is TAG Immobilien Worth?

According to our valuation model, the stock is currently overvalued by about 35%, trading at €11.32 compared to our intrinsic value of €8.39. This means that the buying opportunity has probably disappeared for now. Another thing to keep in mind is that TAG Immobilien’s share price is quite stable relative to the market, as indicated by its low beta. This means that if you believe the current share price should move towards its intrinsic value over time, a low beta could suggest it is not likely to reach that level anytime soon, and once it’s there, it may be hard to fall back down into an attractive buying range again.

What kind of growth will TAG Immobilien 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. 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. In the upcoming year, TAG Immobilien's earnings are expected to increase by 86%, 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? It seems like the market has well and truly priced in TEG’s positive outlook, with shares trading above its fair value. However, this brings up another question – is now the right time to sell? If you believe TEG should trade below its current price, selling high and buying it back up again when its price falls towards its real value can be profitable. But before you make this decision, take a look at whether its fundamentals have changed.

Are you a potential investor? If you’ve been keeping an eye on TEG for a while, now may not be the best time to enter into the stock. The price has surpassed its true value, which means there’s no upside from mispricing. However, the positive outlook is encouraging for TEG, which means it’s worth diving deeper into other factors in order to take advantage of the next price drop.

So if you'd like to dive deeper into this stock, it's crucial to consider any risks it's facing. Case in point: We've spotted 1 warning sign for TAG Immobilien you should be aware of.

If you are no longer interested in TAG Immobilien, 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.