Is It Too Late To Consider Buying ASSA ABLOY AB (publ) (STO:ASSA B)?

Let's talk about the popular ASSA ABLOY AB (publ) (STO:ASSA B). The company's shares received a lot of attention from a substantial price movement on the OM over the last few months, increasing to kr317 at one point, and dropping to the lows of kr282. 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 ASSA ABLOY's current trading price of kr311 reflective of the actual value of the large-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let’s take a look at ASSA ABLOY’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 ASSA ABLOY

What's The Opportunity In ASSA ABLOY?

According to our valuation model, ASSA ABLOY seems to be fairly priced at around 20% below our intrinsic value, which means if you buy ASSA ABLOY today, you’d be paying a reasonable price for it. And if you believe the company’s true value is SEK387.07, then there’s not much of an upside to gain from mispricing. Furthermore, ASSA ABLOY’s low beta implies that the stock is less volatile than the wider market.

What kind of growth will ASSA ABLOY 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 37% over the next couple of years, the future seems bright for ASSA ABLOY. 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 ASSA B’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 ASSA B, now may not be the most optimal time to buy, given it is trading around its fair value. However, the positive outlook 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.

With this in mind, we wouldn't consider investing in a stock unless we had a thorough understanding of the risks. At Simply Wall St, we found 1 warning sign for ASSA ABLOY and we think they deserve your attention.

If you are no longer interested in ASSA ABLOY, 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.