When Should You Buy Hanwha Ocean Co., Ltd. (KRX:042660)?

While Hanwha Ocean Co., Ltd. (KRX:042660) might not have the largest market cap around , it received a lot of attention from a substantial price increase on the KOSE over the last few months. While good news for shareholders, the company has traded much higher in the past year. 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. However, could the stock still be trading at a relatively cheap price? Let’s take a look at Hanwha Ocean’s outlook and value based on the most recent financial data to see if the opportunity still exists.

Check out our latest analysis for Hanwha Ocean

What's The Opportunity In Hanwha Ocean?

According to our valuation model, Hanwha Ocean seems to be fairly priced at around 6.7% below our intrinsic value, which means if you buy Hanwha Ocean today, you’d be paying a fair price for it. And if you believe that the stock is really worth ₩34676.32, then there isn’t much room for the share price grow beyond what it’s currently trading. Is there another opportunity to buy low in the future? Since Hanwha Ocean’s share price is quite volatile, we could potentially see it sink lower (or rise higher) in the future, giving us another chance to buy. This is based on its high beta, which is a good indicator for how much the stock moves relative to the rest of the market.

Can we expect growth from Hanwha Ocean?

Investors looking for growth in their portfolio may want to consider the prospects of a company before buying its shares. Although value investors would argue that it’s the intrinsic value relative to the price that matter the most, a more compelling investment thesis would be high growth potential at a cheap price. However, with a relatively muted profit growth of 7.5% expected over the next couple of years, growth doesn’t seem like a key driver for a buy decision for Hanwha Ocean, at least in the short term.

What This Means For You

Are you a shareholder? It seems like the market has already priced in A042660’s future outlook, with shares trading around its fair value. 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 the stock? Will you have enough conviction to buy should the price fluctuates below the true value?

Are you a potential investor? If you’ve been keeping tabs on A042660, now may not be the most advantageous time to buy, given it is trading around its fair value. However, the positive outlook 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.

With this in mind, we wouldn't consider investing in a stock unless we had a thorough understanding of the risks. Our analysis shows 3 warning signs for Hanwha Ocean (2 are concerning!) and we strongly recommend you look at these before investing.

If you are no longer interested in Hanwha Ocean, 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.