When Should You Buy Jardine Cycle & Carriage Limited (SGX:C07)?

While Jardine Cycle & Carriage Limited (SGX:C07) might not be the most widely known stock at the moment, it saw significant share price movement during recent months on the SGX, rising to highs of S$21.62 and falling to the lows of S$19.02. 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 Jardine Cycle & Carriage's current trading price of S$19.02 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 Jardine Cycle & Carriage’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.

Check out our latest analysis for Jardine Cycle & Carriage

What is Jardine Cycle & Carriage worth?

Great news for investors – Jardine Cycle & Carriage is still trading at a fairly cheap price. According to my valuation, the intrinsic value for the stock is SGD25.89, but it is currently trading at S$19.02 on the share market, meaning that there is still an opportunity to buy now. What’s more interesting is that, Jardine Cycle & Carriage’s share price is theoretically quite stable, which could mean two things: firstly, it may take the share price a while to move to its intrinsic value, and secondly, there may be less chances to buy low in the future once it reaches that value. This is because the stock is less volatile than the wider market given its low beta.

Can we expect growth from Jardine Cycle & Carriage?

Investors looking for growth in their portfolio may want to consider the prospects of a company before buying its shares. 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. Jardine Cycle & Carriage's revenue growth are expected to be in the teens in the upcoming years, indicating a solid future ahead. Unless expenses grow at the same level, or higher, this top-line growth should lead to robust cash flows, feeding into a higher share value.

What this means for you:

Are you a shareholder? Since C07 is currently undervalued, it may be a great time to increase your holdings in the stock. With an optimistic 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 C07 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 C07. 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.

So while earnings quality is important, it's equally important to consider the risks facing Jardine Cycle & Carriage at this point in time. Our analysis shows 4 warning signs for Jardine Cycle & Carriage (1 is potentially serious!) and we strongly recommend you look at these before investing.

If you are no longer interested in Jardine Cycle & Carriage, you can use our free platform to see our list of over 50 other stocks with a high growth potential.

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.

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