Is There Now An Opportunity In Lagercrantz Group AB (publ) (STO:LAGR B)?

Lagercrantz Group AB (publ) (STO:LAGR B), is not the largest company out there, but it saw a significant share price rise of 21% in the past couple of months on the OM. The company's trading levels have reached its high for the past year, following the recent bounce in the share price. As a mid-cap stock with high coverage by analysts, you could assume any recent changes in the company’s outlook is already priced into the stock. However, what if the stock is still a bargain? Let’s examine Lagercrantz Group’s valuation and outlook in more detail to determine if there’s still a bargain opportunity.

View our latest analysis for Lagercrantz Group

What Is Lagercrantz Group Worth?

Lagercrantz Group appears to be overvalued by 27% at the moment, based on our discounted cash flow valuation. The stock is currently priced at kr182 on the market compared to our intrinsic value of SEK143.76. Not the best news for investors looking to buy! If you like the stock, you may want to keep an eye out for a potential price decline in the future. Since Lagercrantz Group’s share price is quite volatile, this could mean it can sink lower (or rise even further) in the future, giving us another chance to invest. This is based on its high beta, which is a good indicator for how much the stock moves relative to the rest of the market.

What does the future of Lagercrantz Group 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. With profit expected to grow by 44% over the next couple of years, the future seems bright for Lagercrantz Group. 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? LAGR B’s optimistic future growth appears to have been factored into the current share price, with shares trading above its fair value. However, this brings up another question – is now the right time to sell? If you believe LAGR B should trade below its current price, selling high and buying it back up again when its price falls towards its real value can be profitable. But before you make this decision, take a look at whether its fundamentals have changed.

Are you a potential investor? If you’ve been keeping tabs on LAGR B for some time, now may not be the best time to enter into the stock. The price has surpassed its true value, which means there’s no upside from mispricing. However, the optimistic prospect is encouraging for LAGR B, which means it’s worth diving deeper into other factors in order to take advantage of the next price drop.

If you want to dive deeper into Lagercrantz Group, you'd also look into what risks it is currently facing. For example - Lagercrantz Group has 1 warning sign we think you should be aware of.

If you are no longer interested in Lagercrantz Group, 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com