Is Now The Time To Look At Buying Lagardere SA (EPA:MMB)?

Lagardere SA (EPA:MMB), is not the largest company out there, but it maintained its current share price over the past couple of month on the ENXTPA, with a relatively tight range of €21.15 to €22.80. However, does this price actually reflect the true value of the mid-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let’s take a look at Lagardere’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.

Check out our latest analysis for Lagardere

What's The Opportunity In Lagardere?

Great news for investors – Lagardere is still trading at a fairly cheap price. Our valuation model shows that the intrinsic value for the stock is €29.56, but it is currently trading at €21.20 on the share market, meaning that there is still an opportunity to buy now. However, given that Lagardere’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 does the future of Lagardere look like?

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. With profit expected to more than double over the next couple of years, the future seems bright for Lagardere. It looks like higher cash flow is on the cards for the stock, which should feed into a higher share valuation.

What This Means For You

Are you a shareholder? Since MMB is currently undervalued, it may be a great time to accumulate more of your holdings in the stock. With an optimistic outlook on the horizon, it seems like this growth has not yet been fully factored into the share price. However, there are also other factors such as capital structure to consider, which could explain the current undervaluation.

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

So while earnings quality is important, it's equally important to consider the risks facing Lagardere at this point in time. When we did our research, we found 4 warning signs for Lagardere (1 shouldn't be ignored!) that we believe deserve your full attention.

If you are no longer interested in Lagardere, 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.