Is Now The Time To Look At Buying CTT - Correios De Portugal, S.A. (ELI:CTT)?

CTT - Correios De Portugal, S.A. (ELI:CTT), is not the largest company out there, but it saw significant share price movement during recent months on the ENXTLS, rising to highs of €4.68 and falling to the lows of €3.30. 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 CTT - Correios De Portugal's current trading price of €3.30 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 CTT - Correios De Portugal’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.

Check out our latest analysis for CTT - Correios De Portugal

Is CTT - Correios De Portugal still cheap?

According to my valuation model, CTT - Correios De Portugal seems to be fairly priced at around 5.63% above my intrinsic value, which means if you buy CTT - Correios De Portugal today, you’d be paying a relatively fair price for it. And if you believe that the stock is really worth €3.12, then there isn’t really any room for the share price grow beyond what it’s currently trading. What's more, CTT - Correios De Portugal’s share price may be more stable over time (relative to the market), as indicated by its low beta.

What kind of growth will CTT - Correios De Portugal generate?

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. CTT - Correios De Portugal's earnings over the next few years are expected to increase by 78%, indicating a highly optimistic future ahead. This should lead to more robust cash flows, feeding into a higher share value.

What this means for you:

Are you a shareholder? It seems like the market has already priced in CTT’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 confidence to invest in the company should the price drop below its fair value?

Are you a potential investor? If you’ve been keeping tabs on CTT, 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 diving deeper into other factors such as the strength of its balance sheet, in order to take advantage of the next price drop.

Keep in mind, when it comes to analysing a stock it's worth noting the risks involved. While conducting our analysis, we found that CTT - Correios De Portugal has 2 warning signs and it would be unwise to ignore these.

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

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.