Almirall SA. (BME:ALM), a pharmaceuticals company based in Spain, saw a decent share price growth in the teens level on the BME over the last few months. 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. However, could the stock still be trading at a relatively cheap price? Let’s take a look at Almirall’s outlook and value based on the most recent financial data to see if the opportunity still exists. View our latest analysis for Almirall
Is Almirall still cheap?According to my valuation model, Almirall seems to be fairly priced at around 5.13% below my intrinsic value, which means if you buy Almirall today, you’d be paying a reasonable price for it. And if you believe that the stock is really worth €9.85, then there isn’t much room for the share price grow beyond what it’s currently trading. Furthermore, it seems like Almirall’s share price is quite stable, which means there may be less chances to buy low in the future now that it’s fairly valued. This is because the stock is less volatile than the wider market given its low beta.
What does the future of Almirall look like?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 a double-digit 20.63% over the next couple of years, the outlook is positive for Almirall. If the level of expenses is able to be maintained, it looks like higher cash flows is on the cards for the stock, which should feed into a higher share valuation.
What this means for you:
Are you a shareholder? It seems like the market has already priced in ALM’s positive outlook, 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 conviction to buy should the price fluctuates below the true value?
Are you a potential investor? If you’ve been keeping tabs on ALM, now may not be the most advantageous time to buy, given it is trading around its fair value. However, the positive outlook 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.
Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on Almirall. You can find everything you need to know about Almirall in the latest infographic research report. If you are no longer interested in Almirall, you can use our free platform to see my list of over 50 other stocks with a high growth potential.