Why Catering International & Services Société Anonyme (EPA:CTRG) Could Be Worth Watching

Catering International & Services Société Anonyme (EPA:CTRG), is not the largest company out there, but it saw a double-digit share price rise of over 10% in the past couple of months on the ENXTPA. As a small cap stock, hardly covered by any analysts, there is generally more of an opportunity for mispricing as there is less activity to push the stock closer to fair value. Is there still an opportunity here to buy? Let’s take a look at Catering International & Services Société Anonyme’s outlook and value based on the most recent financial data to see if the opportunity still exists.

Our analysis indicates that CTRG is potentially undervalued!

What Is Catering International & Services Société Anonyme Worth?

Great news for investors – Catering International & Services Société Anonyme is still trading at a fairly cheap price. According to my valuation, the intrinsic value for the stock is €14.28, but it is currently trading at €9.40 on the share market, meaning that there is still an opportunity to buy now. What’s more interesting is that, Catering International & Services Société Anonyme’s share price is quite volatile, which gives us more chances to buy since the share price could sink lower (or rise higher) in the future. 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 Catering International & Services Société Anonyme generate?

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. However, with a negative profit growth of -5.4% expected over the next couple of years, near-term growth certainly doesn’t appear to be a driver for a buy decision for Catering International & Services Société Anonyme. This certainty tips the risk-return scale towards higher risk.

What This Means For You

Are you a shareholder? Although CTRG is currently undervalued, the adverse prospect of negative growth brings about some degree of risk. I recommend you think about whether you want to increase your portfolio exposure to CTRG, 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 tabs on CTRG for some time, but hesitant on making the leap, I recommend you research further 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.

If you'd like to know more about Catering International & Services Société Anonyme as a business, it's important to be aware of any risks it's facing. When we did our research, we found 2 warning signs for Catering International & Services Société Anonyme (1 can't be ignored!) that we believe deserve your full attention.

If you are no longer interested in Catering International & Services Société Anonyme, 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.