What Is COSCO SHIPPING Ports Limited's (HKG:1199) Share Price Doing?

COSCO SHIPPING Ports Limited (HKG:1199), is not the largest company out there, but it saw significant share price movement during recent months on the SEHK, rising to highs of HK$6.16 and falling to the lows of HK$4.76. 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 COSCO SHIPPING Ports' current trading price of HK$4.88 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 COSCO SHIPPING Ports’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 COSCO SHIPPING Ports

Is COSCO SHIPPING Ports Still Cheap?

According to my price multiple model, which makes a comparison between the company's price-to-earnings ratio and the industry average, the stock price seems to be justfied. 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 COSCO SHIPPING Ports’s ratio of 5.91x is trading slightly above its industry peers’ ratio of 5.44x, which means if you buy COSCO SHIPPING Ports today, you’d be paying a relatively sensible price for it. And if you believe COSCO SHIPPING Ports should be trading in this range, then there isn’t really any room for the share price grow beyond the levels of other industry peers over the long-term. In addition to this, it seems like COSCO SHIPPING Ports’s share price is quite stable, which could mean there may be less chances to buy low in the future now that it’s trading around the price multiples of other industry peers. This is because the stock is less volatile than the wider market given its low beta.

What kind of growth will COSCO SHIPPING Ports generate?

Future outlook is an important aspect when you’re looking at buying a stock, especially if you are an investor looking for growth in your portfolio. 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. COSCO SHIPPING Ports' earnings growth are expected to be in the teens in the upcoming years, indicating a solid future ahead. This should lead to robust cash flows, feeding into a higher share value.

What This Means For You

Are you a shareholder? It seems like the market has already priced in 1199’s positive outlook, with shares trading around industry price multiples. However, there are also other important factors which we haven’t considered today, such as the track record of its management team. Have these factors changed since the last time you looked at 1199? Will you have enough confidence to invest in the company should the price drop below the industry PE ratio?

Are you a potential investor? If you’ve been keeping an eye on 1199, now may not be the most advantageous time to buy, given it is trading around industry price multiples. However, the positive outlook is encouraging for 1199, which means it’s worth further examining other factors such as the strength of its balance sheet, in order to take advantage of the next price drop.

If you want to dive deeper into COSCO SHIPPING Ports, you'd also look into what risks it is currently facing. While conducting our analysis, we found that COSCO SHIPPING Ports has 2 warning signs and it would be unwise to ignore these.

If you are no longer interested in COSCO SHIPPING Ports, 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.