Should You Investigate SUNIC SYSTEM Co., Ltd. (KOSDAQ:171090) At ₩51,800?

SUNIC SYSTEM Co., Ltd. (KOSDAQ:171090), is not the largest company out there, but it received a lot of attention from a substantial price increase on the KOSDAQ over the last few months. The company is now trading at yearly-high levels following the recent surge in its share price. 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 take a look at SUNIC SYSTEM’s outlook and value based on the most recent financial data to see if the opportunity still exists.

This technology could replace computers: discover the 20 stocks are working to make quantum computing a reality.

What's The Opportunity In SUNIC SYSTEM?

Great news for investors – SUNIC SYSTEM is still trading at a fairly cheap price according to our price multiple model, where we compare the company's price-to-earnings ratio to the industry average. We’ve used the price-to-earnings ratio in this instance because there’s not enough visibility to forecast its cash flows. The stock’s ratio of 12.52x is currently well-below the industry average of 23.48x, meaning that it is trading at a cheaper price relative to its peers. However, given that SUNIC SYSTEM’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.

See our latest analysis for SUNIC SYSTEM

Can we expect growth from SUNIC SYSTEM?

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. 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 76% over the next year, the near-term future seems bright for SUNIC SYSTEM. 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? Since A171090 is currently trading below the industry PE ratio, it may be a great time to accumulate more of your holdings in the stock. With a positive profit outlook on the horizon, it seems like this growth has not yet been fully factored into the share price. However, there are also other factors such as capital structure to consider, which could explain the current price multiple.

Are you a potential investor? If you’ve been keeping an eye on A171090 for a while, now might be the time to make a leap. Its buoyant future profit outlook isn’t fully reflected in the current share price yet, which means it’s not too late to buy A171090. But before you make any investment decisions, consider other factors such as the strength of its balance sheet, in order to make a well-informed assessment.

It can be quite valuable to consider what analysts expect for SUNIC SYSTEM from their most recent forecasts. So feel free to check out our free graph representing analyst forecasts.

If you are no longer interested in SUNIC SYSTEM, you can use our free platform to see our list of over 50 other stocks with a high growth potential.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.