Should You Think About Buying The National Agricultural Development Company (TADAWUL:6010) Now?

By
Simply Wall St
Published
January 08, 2022
SASE:6010
Source: Shutterstock

The National Agricultural Development Company (TADAWUL:6010), is not the largest company out there, but it saw significant share price movement during recent months on the SASE, rising to highs of ر.س36.50 and falling to the lows of ر.س30.10. 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 National Agricultural Development's current trading price of ر.س32.20 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 National Agricultural Development’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 National Agricultural Development

What is National Agricultural Development worth?

Good news, investors! National Agricultural Development is still a bargain right now. My valuation model shows that the intrinsic value for the stock is SAR42.77, which is above what the market is valuing the company at the moment. This indicates a potential opportunity to buy low. Another thing to keep in mind is that National Agricultural Development’s share price may be quite stable relative to the rest of the market, as indicated by its low beta. This means that if you believe the current share price should move towards its intrinsic value over time, a low beta could suggest it is not likely to reach that level anytime soon, and once it’s there, it may be hard to fall back down into an attractive buying range again.

What kind of growth will National Agricultural Development generate?

earnings-and-revenue-growth
SASE:6010 Earnings and Revenue Growth January 8th 2022

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. National Agricultural Development's revenue growth are expected to be in the teens in the upcoming years, indicating a solid future ahead. Unless expenses grow at the same level, or higher, this top-line growth should lead to robust cash flows, feeding into a higher share value.

What this means for you:

Are you a shareholder? Since 6010 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 financial health to consider, which could explain the current undervaluation.

Are you a potential investor? If you’ve been keeping an eye on 6010 for a while, now might be the time to enter the stock. Its prosperous future outlook isn’t fully reflected in the current share price yet, which means it’s not too late to buy 6010. 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.

Keep in mind, when it comes to analysing a stock it's worth noting the risks involved. Every company has risks, and we've spotted 1 warning sign for National Agricultural Development you should know about.

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

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