Should You Investigate Saudi Kayan Petrochemical Company (TADAWUL:2350) At ر.س12.04?

Saudi Kayan Petrochemical Company (TADAWUL:2350), is not the largest company out there, but it led the SASE gainers with a relatively large price hike in the past couple of weeks. 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. However, could the stock still be trading at a relatively cheap price? Let’s take a look at Saudi Kayan Petrochemical’s outlook and value based on the most recent financial data to see if the opportunity still exists.

See our latest analysis for Saudi Kayan Petrochemical

What is Saudi Kayan Petrochemical worth?

Great news for investors – Saudi Kayan Petrochemical is still trading at a fairly cheap price. According to my valuation, the intrinsic value for the stock is SAR15.92, but it is currently trading at ر.س12.04 on the share market, meaning that there is still an opportunity to buy now. What’s more interesting is that, Saudi Kayan Petrochemical’s share price is theoretically quite stable, which could mean two things: firstly, it may take the share price a while to move to its intrinsic value, and secondly, there may be less chances to buy low in the future once it reaches that value. This is because the stock is less volatile than the wider market given its low beta.

What does the future of Saudi Kayan Petrochemical 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. 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. In the upcoming year, Saudi Kayan Petrochemical's earnings are expected to increase by 73%, 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? Since 2350 is currently undervalued, it may be a great time to accumulate more of your holdings in the stock. With an optimistic 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 2350 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 2350. But before you make any investment decisions, consider other factors such as the track record of its management team, in order to make a well-informed investment decision.

Diving deeper into the forecasts for Saudi Kayan Petrochemical mentioned earlier will help you understand how analysts view the stock going forward. At Simply Wall St, we have the analysts estimates which you can view by clicking here.

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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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