Is Grupo Televisa, S.A.B. (BMV:TLEVISACPO) Potentially Undervalued?

Grupo Televisa, S.A.B. (BMV:TLEVISACPO), might not be a large cap stock, but it saw significant share price movement during recent months on the BMV, rising to highs of Mex$10.31 and falling to the lows of Mex$7.13. 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 Grupo Televisa's current trading price of Mex$7.21 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 Grupo Televisa’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.

See our latest analysis for Grupo Televisa

Is Grupo Televisa Still Cheap?

The stock seems fairly valued at the moment according to our valuation model. It’s trading around 0.89% above our intrinsic value, which means if you buy Grupo Televisa today, you’d be paying a relatively fair price for it. And if you believe the company’s true value is MX$7.15, then there isn’t really any room for the share price grow beyond what it’s currently trading. Is there another opportunity to buy low in the future? Since Grupo Televisa’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 Grupo Televisa?

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. Though in the case of Grupo Televisa, it is expected to deliver a negative revenue growth of -7.3% over the next couple of years, which doesn’t help build up its investment thesis. It appears that risk of future uncertainty is high, at least in the near term.

What This Means For You

Are you a shareholder? TLEVISA CPO seems fairly priced right now, but given the uncertainty from negative returns in the future, this could be the right time to reduce the risk in your portfolio. Is your current exposure to the stock optimal for your total portfolio? And is the opportunity cost of holding a negative-outlook stock too high? Before you make a decision on the stock, take a look at whether its fundamentals have changed.

Are you a potential investor? If you’ve been keeping an eye on TLEVISA CPO for a while, now may not be the most optimal time to buy, given it is trading around its fair value. The price seems to be trading at fair value, which means there’s less benefit from mispricing. Furthermore, the negative growth outlook increases the risk of holding the stock. However, there are also other important factors we haven’t considered today, which can help gel your views on TLEVISA CPO should the price fluctuate below its true value.

If you want to dive deeper into Grupo Televisa, you'd also look into what risks it is currently facing. To help with this, we've discovered 3 warning signs (2 are significant!) that you ought to be aware of before buying any shares in Grupo Televisa.

If you are no longer interested in Grupo Televisa, 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.