What Is HEXPOL AB (publ)'s (STO:HPOL B) Share Price Doing?

HEXPOL AB (publ) (STO:HPOL B), might not be a large cap stock, but it saw a double-digit share price rise of over 10% in the past couple of months on the OM. 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 HEXPOL’s outlook and value based on the most recent financial data to see if the opportunity still exists.

Check out our latest analysis for HEXPOL

Is HEXPOL still cheap?

Good news, investors! HEXPOL is still a bargain right now. According to my valuation, the intrinsic value for the stock is SEK141.83, but it is currently trading at kr110 on the share market, meaning that there is still an opportunity to buy now. Although, there may be another chance to buy again in the future. This is because HEXPOL’s beta (a measure of share price volatility) is high, meaning its price movements will be exaggerated relative to the rest of the market. If the market is bearish, the company's shares will likely fall by more than the rest of the market, providing a prime buying opportunity.

What does the future of HEXPOL 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. 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. However, with a negative profit growth of -4.0% expected over the next couple of years, near-term growth certainly doesn’t appear to be a driver for a buy decision for HEXPOL. This certainty tips the risk-return scale towards higher risk.

What this means for you:

Are you a shareholder? Although HPOL B is currently undervalued, the negative outlook does bring on some uncertainty, which equates to higher risk. I recommend you think about whether you want to increase your portfolio exposure to HPOL B, or whether diversifying into another stock may be a better move for your total risk and return.

Are you a potential investor? If you’ve been keeping tabs on HPOL B for some time, but hesitant on making the leap, I recommend you dig deeper into the stock. Given its current undervaluation, now is a great time to make a decision. But keep in mind the risks that come with negative growth prospects in the future.

It can be quite valuable to consider what analysts expect for HEXPOL from their most recent forecasts. So feel free to check out our free graph representing analyst forecasts.

If you are no longer interested in HEXPOL, 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.