Growth expectations for Haulotte Group SA (ENXTPA:PIG) are high, but many investors are starting to ask whether its last close at €16.26 can still be rationalized by the future potential. Let’s look into this by assessing PIG’s expected growth over the next few years. View our latest analysis for Haulotte Group
Should you get excited about PIG’s future?Haulotte Group’s extremely high growth potential in the near future is attracting investors. Expectations from 8 analysts are extremely positive with earnings per share estimated to rise from today’s level of €0.595 to €1.455 over the next three years. This indicates an estimated earnings growth rate of 26.51% per year, on average, which signals a market-beating outlook in the upcoming years.
Is PIG available at a good price after accounting for its growth?
As the legendary value investor Ben Graham once said, “Price is what you pay, value is what you get.” Haulotte Group is trading at price-to-earnings (PE) ratio of 27.32x, which tells us the stock is undervalued based on its latest annual earnings update compared to the machinery average of 27.32x , and overvalued compared to the FR market average ratio of 18.51x .
Given that PIG’s price-to-earnings of 27.32x lies below the industry average, this already indicates that the company could be potentially undervalued. But, seeing as Haulotte Group is perceived as a high-growth stock, we must also account for its earnings growth, which is captured in the PEG ratio. A PE ratio of 27.32x and expected year-on-year earnings growth of 26.51% give Haulotte Group an acceptable PEG ratio of 1.03x. This means that, when we account for Haulotte Group’s growth, the stock can be viewed as slightly overvalued , based on its fundamentals.
What this means for you:
PIG’s current overvaluation could signal a potential selling opportunity to reduce your exposure to the stock, or it you’re a potential investor, now may not be the right time to buy. However, basing your investment decision off one metric alone is certainly not sufficient. There are many things I have not taken into account in this article and the PEG ratio is very one-dimensional. If you have not done so already, I urge you to complete your research by taking a look at the following:
- Financial Health: Is PIG’s operations financially sustainable? Balance sheets can be hard to analyze, which is why we’ve done it for you. Check out our financial health checks here.
- Past Track Record: Has PIG been consistently performing well irrespective of the ups and downs in the market? Go into more detail in the past performance analysis and take a look at the free visual representations of PIG’s historicals for more clarity.
- Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore our free list of these great stocks here.