Is Now An Opportune Moment To Examine Alps Alpine Co., Ltd. (TSE:6770)?

Alps Alpine Co., Ltd. (TSE:6770), might not be a large cap stock, but it saw a decent share price growth of 18% on the TSE over the last few months. The company is inching closer to its yearly highs following the recent share price climb. With many analysts covering the mid-cap stock, we may expect any price-sensitive announcements have already been factored into the stock’s share price. But what if there is still an opportunity to buy? Today we will analyse the most recent data on Alps Alpine’s outlook and valuation to see if the opportunity still exists.

Check out our latest analysis for Alps Alpine

Is Alps Alpine Still Cheap?

Alps Alpine appears to be overvalued by 28% at the moment, based on our discounted cash flow valuation. The stock is currently priced at JP¥1,549 on the market compared to our intrinsic value of ¥1207.77. This means that the buying opportunity has probably disappeared for now. In addition to this, it seems like Alps Alpine’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 Alps Alpine look like?

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. Though in the case of Alps Alpine, it is expected to deliver a negative revenue growth of -0.8% over the next couple of years, which doesn’t help build up its investment thesis. It appears that risk of future uncertainty is high, at least in the near term.

What This Means For You

Are you a shareholder? If you believe 6770 is currently trading above its value, selling high and buying it back up again when its price falls towards its real value can be profitable. Given the risk from a negative growth outlook, this could be the right time to de-risk your portfolio. 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 tabs on 6770 for some time, now may not be the best time to enter into the stock. The company’s price climbed passed its true value, in addition to a risky future outlook. However, there are also other important factors which we haven’t considered today, such as the financial strength of the company. Should the price fall in the future, will you be well-informed enough to buy?

In light of this, if you'd like to do more analysis on the company, it's vital to be informed of the risks involved. At Simply Wall St, we found 1 warning sign for Alps Alpine and we think they deserve your attention.

If you are no longer interested in Alps Alpine, 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.