Is It Time To Consider Buying Finnair Oyj (HEL:FIA1S)?

Finnair Oyj (HEL:FIA1S), is not the largest company out there, but it received a lot of attention from a substantial price movement on the HLSE over the last few months, increasing to €0.38 at one point, and dropping to the lows of €0.034. 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 Finnair Oyj's current trading price of €0.036 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 Finnair 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 Finnair Oyj

What Is Finnair Oyj Worth?

Great news for investors – Finnair Oyj is still trading at a fairly cheap price. According to our valuation, the intrinsic value for the stock is €0.05, which is above what the market is valuing the company at the moment. This indicates a potential opportunity to buy low. However, given that Finnair Oyj’s share is fairly volatile (i.e. its price movements are magnified relative to the rest of the market) this could mean the price can sink lower, giving us another chance to buy in the future. This is based on its high beta, which is a good indicator for share price volatility.

What kind of growth will Finnair Oyj generate?

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. However, with an extremely negative double-digit change in profit expected over the next couple of years, near-term growth is certainly not a driver of a buy decision. It seems like high uncertainty is on the cards for Finnair Oyj, at least in the near future.

What This Means For You

Are you a shareholder? Although FIA1S is currently undervalued, the adverse prospect of negative growth brings about some degree of risk. We recommend you think about whether you want to increase your portfolio exposure to FIA1S, 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 an eye on FIA1S for a while, but hesitant on making the leap, we 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.

With this in mind, we wouldn't consider investing in a stock unless we had a thorough understanding of the risks. At Simply Wall St, we found 3 warning signs for Finnair Oyj and we think they deserve your attention.

If you are no longer interested in Finnair 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.