When Should You Buy FGV Holdings Berhad (KLSE:FGV)?

While FGV Holdings Berhad (KLSE:FGV) might not be the most widely known stock at the moment, it saw significant share price movement during recent months on the KLSE, rising to highs of RM1.34 and falling to the lows of RM1.01. 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 FGV Holdings Berhad's current trading price of RM1.05 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 FGV Holdings Berhad’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 FGV Holdings Berhad

Is FGV Holdings Berhad still cheap?

Good news, investors! FGV Holdings Berhad is still a bargain right now. My valuation model shows that the intrinsic value for the stock is MYR1.65, but it is currently trading at RM1.05 on the share market, meaning that there is still an opportunity to buy now. Although, there may be another chance to buy again in the future. This is because FGV Holdings Berhad’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.

Can we expect growth from FGV Holdings Berhad?

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. 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 18% over the next couple of years, the outlook is positive for FGV Holdings Berhad. 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 FGV is currently undervalued, it may be a great time to increase 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 FGV for a while, now might be the time to make a leap. Its buoyant future outlook isn’t fully reflected in the current share price yet, which means it’s not too late to buy FGV. 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 buy.

With this in mind, we wouldn't consider investing in a stock unless we had a thorough understanding of the risks. For example, we've discovered 3 warning signs that you should run your eye over to get a better picture of FGV Holdings Berhad.

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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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