Is There Now An Opportunity In Verallia Société Anonyme (EPA:VRLA)?

Verallia Société Anonyme (EPA:VRLA), is not the largest company out there, but it saw significant share price movement during recent months on the ENXTPA, rising to highs of €44.44 and falling to the lows of €33.40. 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 Verallia Société Anonyme's current trading price of €36.26 reflective of the actual value of the mid-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let’s take a look at Verallia Société Anonyme’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.

View our latest analysis for Verallia Société Anonyme

What Is Verallia Société Anonyme Worth?

Great news for investors – Verallia Société Anonyme is still trading at a fairly cheap price according to my price multiple model, where I compare the company's price-to-earnings ratio to the industry average. In this instance, I’ve used the price-to-earnings (PE) ratio given that there is not enough information to reliably forecast the stock’s cash flows. I find that Verallia Société Anonyme’s ratio of 8.86x is below its peer average of 17.49x, which indicates the stock is trading at a lower price compared to the Packaging industry. Verallia Société Anonyme’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 industry peers, 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 Verallia Société Anonyme look like?

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. However, with a relatively muted profit growth of 5.6% expected over the next couple of years, growth doesn’t seem like a key driver for a buy decision for Verallia Société Anonyme, at least in the short term.

What This Means For You

Are you a shareholder? Even though growth is relatively muted, since VRLA is currently trading below the industry PE ratio, it may be a great time to increase your holdings in the stock. However, there are also other factors such as capital structure to consider, which could explain the current price multiple.

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

If you want to dive deeper into Verallia Société Anonyme, you'd also look into what risks it is currently facing. Every company has risks, and we've spotted 2 warning signs for Verallia Société Anonyme you should know about.

If you are no longer interested in Verallia Société Anonyme, you can use our free platform to see our list of over 50 other stocks with a high growth potential.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.