What Is NOROO PAINT & COATINGS Co., Ltd.'s (KRX:090350) Share Price Doing?

NOROO PAINT & COATINGS Co., Ltd. (KRX:090350), is not the largest company out there, but it received a lot of attention from a substantial price increase on the KOSE over the last few months. As a small cap stock, hardly covered by any analysts, there is generally more of an opportunity for mispricing as there is less activity to push the stock closer to fair value. Is there still an opportunity here to buy? Let’s examine NOROO PAINT & COATINGS’s valuation and outlook in more detail to determine if there’s still a bargain opportunity.

Check out our latest analysis for NOROO PAINT & COATINGS

What is NOROO PAINT & COATINGS worth?

According to my valuation model, NOROO PAINT & COATINGS seems to be fairly priced at around 14.93% above my intrinsic value, which means if you buy NOROO PAINT & COATINGS today, you’d be paying a relatively fair price for it. And if you believe that the stock is really worth ₩8161.49, there’s only an insignificant downside when the price falls to its real value. Furthermore, NOROO PAINT & COATINGS’s low beta implies that the stock is less volatile than the wider market.

What does the future of NOROO PAINT & COATINGS look like?

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. With profit expected to grow by 82% over the next couple of years, the future seems bright for NOROO PAINT & COATINGS. 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? A090350’s optimistic future growth appears to have been factored into the current share price, with shares trading around its fair value. However, there are also other important factors which we haven’t considered today, such as the financial strength of the company. 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 an eye on A090350, now may not be the most advantageous time to buy, given it is trading around its fair value. However, the positive outlook is encouraging for the company, which 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.

So if you'd like to dive deeper into this stock, it's crucial to consider any risks it's facing. In terms of investment risks, we've identified 2 warning signs with NOROO PAINT & COATINGS, and understanding these should be part of your investment process.

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This article by Simply Wall St is general in nature. 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.
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