What Does Sino-Ocean Group Holding Limited's (HKG:3377) Share Price Indicate?

By
Simply Wall St
Published
October 03, 2021
SEHK:3377
Source: Shutterstock

While Sino-Ocean Group Holding Limited (HKG:3377) might not be the most widely known stock at the moment, it saw a double-digit share price rise of over 10% in the past couple of months on the SEHK. As a stock with high coverage by analysts, you could assume any recent changes in the company’s outlook is already priced into the stock. However, what if the stock is still a bargain? Let’s take a look at Sino-Ocean Group Holding’s outlook and value based on the most recent financial data to see if the opportunity still exists.

Check out our latest analysis for Sino-Ocean Group Holding

What is Sino-Ocean Group Holding worth?

Great news for investors – Sino-Ocean Group Holding is still trading at a fairly cheap price. My valuation model shows that the intrinsic value for the stock is HK$2.44, but it is currently trading at HK$1.53 on the share market, meaning that there is still an opportunity to buy now. Although, there may be another chance to buy again in the future. This is because Sino-Ocean Group Holding’s beta (a measure of share price volatility) is high, meaning its price movements will be exaggerated relative to the rest of the market. If the market is bearish, the company's shares will likely fall by more than the rest of the market, providing a prime buying opportunity.

Can we expect growth from Sino-Ocean Group Holding?

earnings-and-revenue-growth
SEHK:3377 Earnings and Revenue Growth October 4th 2021

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. Though in the case of Sino-Ocean Group Holding, it is expected to deliver a relatively unexciting earnings growth of 6.0%, which doesn’t help build up its investment thesis. Growth doesn’t appear to be a main reason for a buy decision for the company, at least in the near term.

What this means for you:

Are you a shareholder? Even though growth is relatively muted, since 3377 is currently undervalued, it may be a great time to accumulate more of your holdings in the stock. 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 3377 for a while, now might be the time to enter the stock. Its future outlook isn’t fully reflected in the current share price yet, which means it’s not too late to buy 3377. 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 investment decision.

Keep in mind, when it comes to analysing a stock it's worth noting the risks involved. For example, Sino-Ocean Group Holding has 2 warning signs (and 1 which doesn't sit too well with us) we think you should know about.

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

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