Is Now An Opportune Moment To Examine Thrace Plastics Holding and Commercial S.A. (ATH:PLAT)?

Thrace Plastics Holding and Commercial S.A. (ATH:PLAT), is not the largest company out there, but it saw a significant share price rise of over 20% in the past couple of months on the ATSE. 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 examine Thrace Plastics Holding and Commercial’s valuation and outlook in more detail to determine if there’s still a bargain opportunity.

See our latest analysis for Thrace Plastics Holding and Commercial

What is Thrace Plastics Holding and Commercial worth?

Great news for investors – Thrace Plastics Holding and Commercial 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. I’ve used the price-to-earnings ratio in this instance because there’s not enough visibility to forecast its cash flows. The stock’s ratio of 5.15x is currently well-below the industry average of 25.32x, meaning that it is trading at a cheaper price relative to its peers. What’s more interesting is that, Thrace Plastics Holding and Commercial’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 Thrace Plastics Holding and Commercial generate?

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 negative profit growth of -1.6% expected over the next couple of years, near-term growth certainly doesn’t appear to be a driver for a buy decision for Thrace Plastics Holding and Commercial. This certainty tips the risk-return scale towards higher risk.

What this means for you:

Are you a shareholder? Although PLAT is currently trading below the industry PE ratio, the negative profit outlook does bring on some uncertainty, which equates to higher risk. I recommend you think about whether you want to increase your portfolio exposure to PLAT, 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 PLAT for some time, but hesitant on making the leap, I recommend you dig deeper into the stock. Given its current price multiple, 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 want to dive deeper into Thrace Plastics Holding and Commercial, you'd also look into what risks it is currently facing. Our analysis shows 3 warning signs for Thrace Plastics Holding and Commercial (1 is significant!) and we strongly recommend you look at these before investing.

If you are no longer interested in Thrace Plastics Holding and Commercial, 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. 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.
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