What Does Bharti Infratel Limited's (NSE:INFRATEL) Share Price Indicate?

Bharti Infratel Limited (NSEI:INFRATEL), a telecom company based in India, saw significant share price volatility over the past couple of months on the NSEI, rising to the highs of ₹386.6 and falling to the lows of ₹327.4. This high level of volatility gives investors the opportunity to enter into the stock, and potentially buy at an artificially low price. A question to answer is whether Bharti Infratel's current trading price of ₹333.85 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 Bharti Infratel’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 Bharti Infratel

What is Bharti Infratel worth?

The stock is currently trading at IN₨333.85 on the share market, which means it is overvalued by 95% compared to my intrinsic value of ₹171.58. Not the best news for investors looking to buy! In addition to this, it seems like Bharti Infratel’s share price is quite stable, which could mean two things: firstly, it may take the share price a while to fall back down to an attractive buying range, and secondly, there may be less chances to buy low in the future once it reaches that value. This is because the stock is less volatile than the wider market given its low beta.

What does the future of Bharti Infratel 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. Bharti Infratel’s 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? INFRATEL’s optimistic future growth appears to have been factored into the current share price, with shares trading above its fair value. However, this brings up another question – is now the right time to sell? If you believe INFRATEL should trade below its current price, selling high and buying it back up again when its price falls towards its real value can be profitable. But before you make this decision, take a look at whether its fundamentals have changed.

Are you a potential investor? If you’ve been keeping an eye on INFRATEL for a while, now may not be the best time to enter into the stock. The price has surpassed its true value, which means there’s no upside from mispricing. However, the positive outlook is encouraging for INFRATEL, which means it’s worth diving deeper into other factors in order to take advantage of the next price drop.

Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on Bharti Infratel. You can find everything you need to know about Bharti Infratel in the latest infographic research report. If you are no longer interested in Bharti Infratel, you can use our free platform to see my list of over 50 other stocks with a high growth potential.

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Simply Wall St analyst Simply Wall St and Simply Wall St have no position in any of the companies mentioned. This article 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.