Is Now The Time To Look At Buying Husqvarna AB (publ) (STO:HUSQ B)?

Husqvarna AB (publ) (STO:HUSQ B), might not be a large cap stock, but it received a lot of attention from a substantial price movement on the OM over the last few months, increasing to kr145 at one point, and dropping to the lows of kr121. 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 Husqvarna's current trading price of kr122 reflective of the actual value of the mid-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let’s take a look at Husqvarna’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 Husqvarna

Is Husqvarna still cheap?

Good news, investors! Husqvarna is still a bargain right now. My valuation model shows that the intrinsic value for the stock is SEK192.56, but it is currently trading at kr122 on the share market, meaning that there is still an opportunity to buy now. However, given that Husqvarna’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 another chance to buy in the future. This is based on its high beta, which is a good indicator for share price volatility.

What does the future of Husqvarna look like?

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 a double-digit 17% over the next couple of years, the outlook is positive for Husqvarna. 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? Since HUSQ B 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 capital structure to consider, which could explain the current undervaluation.

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

Since timing is quite important when it comes to individual stock picking, it's worth taking a look at what those latest analysts forecasts are. So feel free to check out our free graph representing analyst forecasts.

If you are no longer interested in Husqvarna, 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.