Is It Too Late To Consider Buying Fortaleza Materiales, S.A.B. de C.V. (BMV:FORTALE)?

By
Simply Wall St
Published
November 25, 2021
BMV:FORTALE *
Source: Shutterstock

Fortaleza Materiales, S.A.B. de C.V. (BMV:FORTALE), might not be a large cap stock, but it saw a double-digit share price rise of over 10% in the past couple of months on the BMV. Less-covered, small caps sees more of an opportunity for mispricing due to the lack of information available to the public, which can be a good thing. So, could the stock still be trading at a low price relative to its actual value? Let’s take a look at Fortaleza Materiales. de’s outlook and value based on the most recent financial data to see if the opportunity still exists.

See our latest analysis for Fortaleza Materiales. de

What is Fortaleza Materiales. de worth?

Great news for investors – Fortaleza Materiales. de is still trading at a fairly cheap price. My valuation model shows that the intrinsic value for the stock is MX$24.85, which is above what the market is valuing the company at the moment. This indicates a potential opportunity to buy low. Although, there may be another chance to buy again in the future. This is because Fortaleza Materiales. de’s beta (a measure of share price volatility) is high, meaning its price movements will be exaggerated relative to the rest of the market. If the market is bearish, the company's shares will likely fall by more than the rest of the market, providing a prime buying opportunity.

What kind of growth will Fortaleza Materiales. de generate?

earnings-and-revenue-growth
BMV:FORTALE * Earnings and Revenue Growth November 26th 2021

Investors looking for growth in their portfolio may want to consider the prospects of a company before buying its shares. 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. With revenues expected to grow by a double-digit 12% over the next couple of years, the outlook is positive for Fortaleza Materiales. de. If the level of expenses is able to be maintained, 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 FORTALE * is currently undervalued, it may be a great time to accumulate more of your holdings in the stock. With a positive 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 undervaluation.

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

If you want to dive deeper into Fortaleza Materiales. de, you'd also look into what risks it is currently facing. Every company has risks, and we've spotted 2 warning signs for Fortaleza Materiales. de (of which 1 makes us a bit uncomfortable!) you should know about.

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

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