At S$1.08, Is It Time To Put Raffles Medical Group Ltd (SGX:BSL) On Your Watch List?

Raffles Medical Group Ltd (SGX:BSL), is not the largest company out there, but it saw a double-digit share price rise of over 10% in the past couple of months on the SGX. As a stock with high coverage by analysts, you could assume any recent changes in the company’s outlook is already priced into the stock. However, could the stock still be trading at a relatively cheap price? Let’s take a look at Raffles Medical Group’s outlook and value based on the most recent financial data to see if the opportunity still exists.

View our latest analysis for Raffles Medical Group

Is Raffles Medical Group still cheap?

According to my valuation model, Raffles Medical Group seems to be fairly priced at around 6.84% above my intrinsic value, which means if you buy Raffles Medical Group today, you’d be paying a relatively fair price for it. And if you believe the company’s true value is SGD1.01, then there isn’t really any room for the share price grow beyond what it’s currently trading. What's more, Raffles Medical Group’s share price may be more stable over time (relative to the market), as indicated by its low beta.

What does the future of Raffles Medical 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. Raffles Medical Group's earnings growth are expected to be in the teens in the upcoming years, indicating a solid future ahead. This should lead to robust cash flows, feeding into a higher share value.

What this means for you:

Are you a shareholder? It seems like the market has already priced in BSL’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 conviction to buy should the price fluctuates below the true value?

Are you a potential investor? If you’ve been keeping tabs on BSL, now may not be the most advantageous 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 diving deeper into other factors such as the strength of its balance sheet, in order to take advantage of the next price drop.

If you'd like to know more about Raffles Medical Group as a business, it's important to be aware of any risks it's facing. In terms of investment risks, we've identified 2 warning signs with Raffles Medical Group, and understanding them should be part of your investment process.

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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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