Should You Investigate Apollo Tyres Limited (NSE:APOLLOTYRE) At ₹534?

Apollo Tyres Limited (NSE:APOLLOTYRE), is not the largest company out there, but it saw a double-digit share price rise of over 10% in the past couple of months on the NSEI. The recent share price gains has brought the company back closer to its yearly peak. As a mid-cap stock with high coverage by analysts, you could assume any recent changes in the company’s outlook is already priced into the stock. But what if there is still an opportunity to buy? Let’s take a look at Apollo Tyres’s outlook and value based on the most recent financial data to see if the opportunity still exists.

View our latest analysis for Apollo Tyres

What Is Apollo Tyres Worth?

Good news, investors! Apollo Tyres is still a bargain right now according to our price multiple model, which compares the company's price-to-earnings ratio to the industry average. We’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 23.41x is currently well-below the industry average of 33.29x, meaning that it is trading at a cheaper price relative to its peers.

What does the future of Apollo Tyres look like?

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. With profit expected to grow by 64% over the next couple of years, the future seems bright for Apollo Tyres. 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 APOLLOTYRE is currently below the industry PE ratio, 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 price multiple.

Are you a potential investor? If you’ve been keeping an eye on APOLLOTYRE for a while, now might be the time to enter the stock. Its prosperous future profit outlook isn’t fully reflected in the current share price yet, which means it’s not too late to buy APOLLOTYRE. 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 assessment.

It can be quite valuable to consider what analysts expect for Apollo Tyres from their most recent forecasts. So feel free to check out our free graph representing analyst forecasts.

If you are no longer interested in Apollo Tyres, 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.