What Is Tikkurila Oyj’s (HEL:TIK1V) Share Price Doing?

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Tikkurila Oyj (HEL:TIK1V), which is in the chemicals business, and is based in Finland, received a lot of attention from a substantial price movement on the HLSE over the last few months, increasing to €15.4 at one point, and dropping to the lows of €13.76. 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 Tikkurila Oyj’s current trading price of €14.34 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 Tikkurila Oyj’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 Tikkurila Oyj

Is Tikkurila Oyj still cheap?

The stock seems fairly valued at the moment according to my valuation model. It’s trading around 4.8% below my intrinsic value, which means if you buy Tikkurila Oyj today, you’d be paying a fair price for it. And if you believe the company’s true value is €15.06, then there’s not much of an upside to gain from mispricing. Is there another opportunity to buy low in the future? Since Tikkurila Oyj’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 Tikkurila Oyj generate?

HLSE:TIK1V Past and Future Earnings, June 4th 2019
HLSE:TIK1V Past and Future Earnings, June 4th 2019

Investors looking for growth in their portfolio may want to consider the prospects of a company before buying its shares. 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. Tikkurila Oyj’s earnings over the next few years are expected to double, indicating a very optimistic future ahead. This should lead to stronger cash flows, feeding into a higher share value.

What this means for you:

Are you a shareholder? TIK1V’s optimistic future growth appears to have been factored into the current share price, with shares trading around its fair value. However, there are also other important factors which we haven’t considered today, such as the financial strength of the company. Have these factors changed since the last time you looked at the stock? Will you have enough confidence to invest in the company should the price drop below its fair value?

Are you a potential investor? If you’ve been keeping tabs on TIK1V, 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 diving deeper into 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 Tikkurila Oyj. You can find everything you need to know about Tikkurila Oyj in the latest infographic research report. If you are no longer interested in Tikkurila Oyj, you can use our free platform to see my list of over 50 other stocks with a high growth potential.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.