What Does Fluidra, S.A.'s (BME:FDR) Share Price Indicate?

While Fluidra, S.A. (BME:FDR) might not be the most widely known stock at the moment, it saw significant share price movement during recent months on the BME, rising to highs of €19.81 and falling to the lows of €12.30. 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 Fluidra's current trading price of €13.40 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 Fluidra’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.

Our analysis indicates that FDR is potentially undervalued!

What's The Opportunity In Fluidra?

Great news for investors – Fluidra is still trading at a fairly cheap price. My valuation model shows that the intrinsic value for the stock is €19.10, but it is currently trading at €13.40 on the share market, meaning that there is still an opportunity to buy now. What’s more interesting is that, Fluidra’s share price is quite volatile, which gives us more chances to buy since the share price could sink lower (or rise higher) in the future. 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.

Can we expect growth from Fluidra?

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. Though in the case of Fluidra, it is expected to deliver a negative earnings growth of -9.4%, which doesn’t help build up its investment thesis. It appears that risk of future uncertainty is high, at least in the near term.

What This Means For You

Are you a shareholder? Although FDR is currently undervalued, the negative outlook does bring on some uncertainty, which equates to higher risk. Consider whether you want to increase your portfolio exposure to FDR, or whether diversifying into another stock may be a better move for your total risk and return.

Are you a potential investor? If you’ve been keeping tabs on FDR for some time, but hesitant on making the leap, I recommend you dig deeper into the stock. Given its current undervaluation, now is a great time to make a decision. But keep in mind the risks that come with negative growth prospects in the future.

If you'd like to know more about Fluidra as a business, it's important to be aware of any risks it's facing. Every company has risks, and we've spotted 4 warning signs for Fluidra (of which 3 can't be ignored!) you should know about.

If you are no longer interested in Fluidra, 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.