Should You Investigate Basic-Fit N.V. (AMS:BFIT) At €42.84?

Basic-Fit N.V. (AMS:BFIT), is not the largest company out there, but it saw a double-digit share price rise of over 10% in the past couple of months on the ENXTAM. With many analysts covering the mid-cap stock, we may expect any price-sensitive announcements have already been factored into the stock’s share price. But what if there is still an opportunity to buy? Today I will analyse the most recent data on Basic-Fit’s outlook and valuation to see if the opportunity still exists.

View our latest analysis for Basic-Fit

Is Basic-Fit still cheap?

According to my valuation model, Basic-Fit seems to be fairly priced at around 15.36% above my intrinsic value, which means if you buy Basic-Fit today, you’d be paying a relatively fair price for it. And if you believe that the stock is really worth €37.13, there’s only an insignificant downside when the price falls to its real value. So, is there another chance to buy low in the future? Given that Basic-Fit’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 an opportunity to buy later on. This is based on its high beta, which is a good indicator for share price volatility.

What kind of growth will Basic-Fit generate?

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 profit expected to grow by 56% over the next year, the near-term future seems bright for Basic-Fit. 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? It seems like the market has already priced in BFIT’s positive outlook, with shares trading around its fair value. However, there are also other important factors which we haven’t considered today, such as the track record of its management team. 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 BFIT, now may not be the most optimal time to buy, given it is trading around its fair value. However, the optimistic prospect 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.

If you want to dive deeper into Basic-Fit, you'd also look into what risks it is currently facing. Every company has risks, and we've spotted 1 warning sign for Basic-Fit you should know about.

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

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.

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