At €128, Is BE Semiconductor Industries N.V. (AMS:BESI) Worth Looking At Closely?

BE Semiconductor Industries N.V. (AMS:BESI) saw a significant share price rise of over 20% in the past couple of months on the ENXTAM. As a large-cap stock with high coverage by analysts, you could assume any recent changes in the company’s outlook is already priced into the stock. However, what if the stock is still a bargain? Today I will analyse the most recent data on BE Semiconductor Industries’s outlook and valuation to see if the opportunity still exists.

See our latest analysis for BE Semiconductor Industries

Is BE Semiconductor Industries Still Cheap?

The stock seems fairly valued at the moment according to my valuation model. It’s trading around 18.92% above my intrinsic value, which means if you buy BE Semiconductor Industries today, you’d be paying a relatively reasonable price for it. And if you believe that the stock is really worth €107.21, 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 BE Semiconductor Industries’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 does the future of BE Semiconductor Industries look like?

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. BE Semiconductor Industries' earnings over the next few years are expected to double, indicating a very optimistic future ahead. This should lead to stronger cash flows, feeding into a higher share value.

What This Means For You

Are you a shareholder? BESI’s optimistic future growth appears to have been factored into the current share price, 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 confidence to invest in the company should the price drop below its fair value?

Are you a potential investor? If you’ve been keeping an eye on BESI, now may not be the most advantageous 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 diving deeper into 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 BE Semiconductor Industries, you'd also look into what risks it is currently facing. Every company has risks, and we've spotted 2 warning signs for BE Semiconductor Industries you should know about.

If you are no longer interested in BE Semiconductor Industries, 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.