At ₩55,400, Is Hyundai Wia Corporation (KRX:011210) Worth Looking At Closely?

Hyundai Wia Corporation (KRX:011210), might not be a large cap stock, but it saw significant share price movement during recent months on the KOSE, rising to highs of ₩64,500 and falling to the lows of ₩55,000. 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 Hyundai Wia's current trading price of ₩55,400 reflective of the actual value of the small-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let’s take a look at Hyundai Wia’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 Hyundai Wia

Is Hyundai Wia Still Cheap?

Hyundai Wia appears to be expensive according to our price multiple model, which makes a comparison between the company's price-to-earnings ratio and the industry average. In this instance, we’ve used the price-to-earnings (PE) ratio given that there is not enough information to reliably forecast the stock’s cash flows. We find that Hyundai Wia’s ratio of 16.14x is above its peer average of 7.73x, which suggests the stock is trading at a higher price compared to the Auto Components industry. But, is there another opportunity to buy low in the future? Given that Hyundai Wia’s share is fairly volatile (i.e. its price movements are magnified relative to the rest of the market) this could mean the price can sink lower, giving us another chance to buy in the future. This is based on its high beta, which is a good indicator for share price volatility.

What does the future of Hyundai Wia 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. Hyundai Wia's earnings over the next few years are expected to double, indicating a very optimistic future ahead. This should lead to stronger cash flows, feeding into a higher share value.

What This Means For You

Are you a shareholder? A011210’s optimistic future growth appears to have been factored into the current share price, with shares trading above industry price multiples. At this current price, shareholders may be asking a different question – should I sell? If you believe A011210 should trade below its current price, selling high and buying it back up again when its price falls towards the industry PE ratio 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 tabs on A011210 for some time, now may not be the best time to enter into the stock. The price has surpassed its industry peers, which means it is likely that there is no more upside from mispricing. However, the optimistic prospect is encouraging for A011210, which means it’s worth diving deeper into other factors in order to take advantage of the next price drop.

If you want to dive deeper into Hyundai Wia, you'd also look into what risks it is currently facing. In terms of investment risks, we've identified 1 warning sign with Hyundai Wia, and understanding this should be part of your investment process.

If you are no longer interested in Hyundai Wia, 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.