Stock Analysis

What Does Keller Group plc's (LON:KLR) Share Price Indicate?

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LSE:KLR
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While Keller Group plc (LON:KLR) might not be the most widely known stock at the moment, it received a lot of attention from a substantial price movement on the LSE over the last few months, increasing to UK£10.00 at one point, and dropping to the lows of UK£8.52. 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 Keller Group's current trading price of UK£8.52 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 Keller Group’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 Keller Group

What is Keller Group worth?

Good news, investors! Keller Group is still a bargain right now. My valuation model shows that the intrinsic value for the stock is £13.94, but it is currently trading at UK£8.52 on the share market, meaning that there is still an opportunity to buy now. What’s more interesting is that, Keller Group’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 does the future of Keller Group look like?

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LSE:KLR Earnings and Revenue Growth January 25th 2022

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. Keller Group's earnings over the next few years are expected to increase by 26%, indicating a highly optimistic future ahead. This should lead to more robust cash flows, feeding into a higher share value.

What this means for you:

Are you a shareholder? Since KLR is currently undervalued, it may be a great time to accumulate more of your holdings in the stock. With a positive 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 KLR for a while, now might be the time to make a leap. Its prosperous future outlook isn’t fully reflected in the current share price yet, which means it’s not too late to buy KLR. 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.

Since timing is quite important when it comes to individual stock picking, it's worth taking a look at what those latest analysts forecasts are. At Simply Wall St, we have the analysts estimates which you can view by clicking here.

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

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Find out whether Keller Group is potentially over or undervalued by checking out our comprehensive analysis, which includes fair value estimates, risks and warnings, dividends, insider transactions and financial health.

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