Is It Time To Consider Buying Stora Enso Oyj (HEL:STERV)?

Today we're going to take a look at the well-established Stora Enso Oyj (HEL:STERV). The company's stock saw a decent share price growth of 14% on the HLSE over the last few months. The recent rally in share prices has nudged the company in the right direction, though it still falls short of its yearly peak. With many analysts covering the large-cap stock, we may expect any price-sensitive announcements have already been factored into the stock’s share price. However, what if the stock is still a bargain? Let’s take a look at Stora Enso Oyj’s outlook and value based on the most recent financial data to see if the opportunity still exists.

See our latest analysis for Stora Enso Oyj

Is Stora Enso Oyj Still Cheap?

Good news, investors! Stora Enso Oyj is still a bargain right now. Our valuation model shows that the intrinsic value for the stock is €16.02, which is above what the market is valuing the company at the moment. This indicates a potential opportunity to buy low. Stora Enso Oyj’s share price also seems relatively stable compared to the rest of the market, as indicated by its low beta. If you believe the share price should eventually reach its true value, a low beta could suggest it is unlikely to rapidly do so anytime soon, and once it’s there, it may be hard to fall back down into an attractive buying range.

What does the future of Stora Enso Oyj look like?

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 57% over the next couple of years, the future seems bright for Stora Enso Oyj. 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? Since STERV is currently undervalued, it may be a great time to increase your holdings in the stock. With an optimistic outlook on the horizon, it seems like this growth has not yet been fully factored into the share price. However, there are also other factors such as capital structure to consider, which could explain the current undervaluation.

Are you a potential investor? If you’ve been keeping an eye on STERV for a while, now might be the time to enter the stock. Its prosperous future outlook isn’t fully reflected in the current share price yet, which means it’s not too late to buy STERV. But before you make any investment decisions, consider other factors such as the track record of its management team, in order to make a well-informed buy.

If you want to dive deeper into Stora Enso Oyj, you'd also look into what risks it is currently facing. When we did our research, we found 3 warning signs for Stora Enso Oyj (1 is a bit concerning!) that we believe deserve your full attention.

If you are no longer interested in Stora Enso Oyj, 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.